UPDATE 2-American Realty in talks to buy NorthStar Realty -sources

Mon Apr 28, 2014 12:15pm EDT

(Adds share movement)

By Soyoung Kim and Mike Stone

NEW YORK, April 28 (Reuters) - American Realty Capital Properties Inc is in talks to buy NorthStar Realty Finance Corp, according to people familiar with the matter, in a deal that would combine a major property owner with a real estate financing company.

The discussions between the two real estate investment trusts are preliminary, and there is no guarantee a deal would materialize, the people said on Monday, requesting anonymity because the matter is not public.

Shares of NorthStar, a loan originator and manager of commercial real estate debt, rose over 9 percent on Monday, bringing the company's market value to roughly $5.8 billion.

Shares of American Capital Realty were down 1.3 percent to $12.82 in midday trading. The New York-based company, which has a market capitalization of nearly $10 billion, has been acquisitive in recent years; it bought Cole Real Estate Investments Inc last year.

A spokesman for American Realty declined to comment on the deal talks, which were earlier reported by the Financial Times. NorthStar could not be immediately reached for comment. (Reporting by Soyoung Kim and Mike Stone in New York; Additional reporting by Sagarika Jaisinghani in Bangalore; Editing by Lisa Von Ahn and Leslie Adler)

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