Paramount Group, Inc. (NYSE:PGRE) saw its stock fall sharply, tumbling 12% after revealing a definitive agreement to be acquired by Rithm Capital Corp. (NYSE:RITM) in an all-cash deal valued at around $1.6 billion.
Under the terms, Rithm will purchase all outstanding Paramount shares at $6.60 per fully diluted share, representing a notable discount from the company’s previous closing price of $7.39, which explains the steep decline in trading.
The acquisition gives Rithm access to a portfolio of 13 owned and 4 managed Class A office properties across New York City and San Francisco, totaling over 13.1 million square feet. As of June 30, 2025, roughly 85.4% of the portfolio was leased.
Martin Bussmann, Lead Independent Director of Paramount, said that after reviewing multiple strategic options, the board believes the transaction “will deliver immediate, full and fair value to our shareholders,” despite the deal price being below the stock’s prior market value.
Rithm intends to finance the acquisition through cash on hand and potential co-investment opportunities, viewing it as a “generational opportunity” to grow its commercial real estate holdings and enhance its asset management capabilities.
The boards of both companies have approved the transaction, which is expected to close in late Q4 2025, pending approval from Paramount shareholders and customary closing conditions.
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