Market Overview

Phillips Edison & Company to Merge with Phillips Edison Grocery Center REIT II

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100% stock-for-stock transaction creates a $6.3 billion REIT focused
exclusively on grocery-anchored shopping centers

Increases market prominence as strong leader in grocery-anchored
shopping center asset class

Merger results in larger, more diversified portfolio with improved
portfolio demographics and increased financial strength

Improves earnings quality and simplifies business model

Management to host conference call on Thursday, July 19 at 10:00 a.m.
Eastern Time to discuss the transaction

Phillips
Edison & Company, Inc.
("PECO"), an
internally-managed real estate investment trust ("REIT") and one of the
nation's largest owners and operators of grocery-anchored shopping
centers, has entered into a definitive merger agreement with Phillips
Edison Grocery Center REIT II, Inc.
("REIT II"), a public
non-traded REIT currently advised and managed by PECO. The transaction
is a 100% stock-for-stock merger with REIT II, having a total enterprise
value ("TEV") of approximately $1.9 billion. PECO's merger with REIT
II's 86 properties will create a national portfolio of 323
grocery-anchored shopping centers encompassing approximately 36.7
million square feet located across 33 states and a TEV of approximately
$6.3 billion.

The combined enterprise will have: larger size and scale, 3.2% higher
annualized base rent per square foot, 2.4% increase in average household
income and 3.8% increase in population density within a 3-mile radius of
the center, broader tenant diversification, and a simpler, more
efficient operating platform. In addition, the merger includes REIT II's
20% ownership interest in Necessity Retail Partners, a joint venture
with TPG Real Estate that presently owns 14 grocery-anchored shopping
centers.

Management Commentary

"This strategic merger of two highly complementary grocery-anchored
shopping center portfolios is the next step on the path to liquidity for
both sets of shareholders," said Jeff Edison, Chairman and Chief
Executive Officer of PECO. "The enhanced size, scale and prominence of
the combined portfolio will greatly improve our access to the capital
markets, which can be used to support ongoing strategic investments, as
well as to drive future growth opportunities."

"The transaction also highlights the value and growth opportunities
inherent in our investment management platform. In REIT II, we raised
$1.1 billion in equity in 2014 and 2015 and have acquired real estate
valued at approximately $1.9 billion since. PECO earned fees as the
external advisor and property manager, and now, PECO has the opportunity
to merge with this complementary, institutional-quality portfolio,
materially increasing its size, scale and diversification."

"We remain bullish on the current operating environment as well as the
long-term fundamentals supporting grocery-anchored shopping centers, and
this merger demonstrates our unwavering confidence in the asset class."

Merger Details

In exchange for each share of REIT II common stock, REIT II shareholders
will receive 2.04 shares of PECO common stock, which is equivalent to
$22.54 per share based on PECO's most recent estimated net asset value
per share (EVPS) of $11.05. The exchange ratio is based on a thorough
review of the relative valuation of each entity, including factoring in
PECO's growing investment management business as well as each company's
transaction costs.

PECO's most recent EVPS of $11.05 and REIT II's most recent EVPS of
$22.80 were both established on May 9, 2018 by the companies' respective
boards of directors based on property valuations performed by an
independent valuation firm.

REIT II will not pay any internalization or disposition fees in
connection with the transaction, and the advisory agreement will be
terminated at closing. REIT II's outstanding debt of approximately $801
million is expected to be refinanced or assumed by PECO at closing under
the terms of the agreement.

On a pro forma basis, immediately following the closing of the
transaction, PECO shareholders are expected to own approximately 71
percent of the combined company, and former REIT II shareholders are
expected to own approximately 29 percent. Upon closing of the
transaction, two of the three REIT II independent directors will join
the board of the combined company, which will consist of seven directors.

As part of this process, both the PECO board and the REIT II special
committee independently retained their own financial and legal advisors.
Upon the conclusion of a thorough due diligence and negotiation process,
PECO's board of directors, REIT II's board of directors, and the
independent special committee formed by REIT II's board of directors
each unanimously approved the transaction.

The closing of the transaction is subject to the satisfaction of
customary conditions, including approval from both PECO and REIT II
shareholders and obtaining certain other third-party consents. The
transaction is expected to close in the fourth quarter of 2018.

Under the terms of the merger agreement, REIT II may solicit, receive,
evaluate, and enter into negotiations with respect to alternative
proposals from third-parties for a period of 30 days continuing through
August 15, 2018. The special committee, with the assistance of its
independent advisors, intends to actively solicit alternative proposals
during this period.

Summary of Strategic Benefits

Consistent with its long-term strategy, PECO expects the merger to
create meaningful operational and financial benefits, including:

  • Materially Improves Portfolio while Maintaining Exclusive Grocery
    Focus:
    Two complementary portfolios are combined to create a
    high-quality portfolio comprising 323 grocery-anchored shopping
    centers with more than 36.7 million square feet located in 33 states
    with an emphasis on necessity-based retailers, which have proven to be
    internet resistant and recession resilient. This institutional-quality
    portfolio has higher occupancy rates, higher annualized base rent per
    square foot, and improved demographics. On a pro forma basis, the
    combined enterprise is expected to realize improvements related to the
    following metrics:
    • Occupancy is expected to increase 43 basis points to 94.0%,
    • Annualized base rent is expected to increase to $11.77 per foot
      from $11.40,
    • Median household income within 3 miles of a center is expected to
      increase 2.4% to $58,602, and
    • Population density within 3 miles of a center is expected to
      increase 3.8% to 60,613.
  • Increases Size, Scale, and Market Prominence: Given its
    enhanced size, scale and portfolio demographics, the combined company
    will have improved access to the capital markets, which can be used to
    support strategic investments to drive future growth opportunities.
  • Actively Positions Company for Liquidity: This strategic merger
    is an important step towards a full cycle liquidity event for
    shareholders.
  • Improves Earnings Quality and Maintains Distribution Coverage:
    Increases the percentage of earnings from real estate from 92% to
    approximately 97%. Real estate earnings are more highly valued in the
    public equity markets than management fee income, given the long-term,
    recurring nature of owning and operating real estate. PECO estimates
    that pro forma FFO for the combined company would have been
    approximately 105% of pro forma distributions for the first quarter of
    2018.
  • Maintains Healthy Leverage Ratio and Strong Balance Sheet: The
    combined company's leverage ratio would have been 42.5% on a Net
    Debt/TEV basis as of March 31, 2018 compared to 41.9% for stand-alone
    PECO. The pro forma total debt was 86.8% fixed-rate with an average
    duration of 4.7 years, which compares to 87.1% and 5.2 years,
    respectively, prior to this merger.
  • Accelerates Strategy to Simplify Business Model: The company
    expects to realize the synergies of operating a combined enterprise
    that remains focused on driving shareholder value and expects a
    seamless integration process as PECO has managed REIT II since
    inception.

Distribution Reinvestment Plan and Share Repurchase Program

In connection with the proposed transaction, PECO is required to
temporarily suspend its distribution reinvestment plan (DRIP) for the
month of July 2018, and DRIP participants will receive their July 2018
distribution (payable on August 1, 2018) in cash. The company expects
that the DRIP will resume in August 2018 (with the distribution payable
on September 1, 2018) after the filing of a joint preliminary proxy
statement.

The share repurchase program (SRP) is also required to be temporarily
suspended for the month of July 2018 and is expected to resume in August
2018 after the filing of the joint preliminary proxy statement. The next
repurchase for death, disability, and incompetence (DDI) is expected to
take place on August 31, 2018. SRP paperwork must be on file and in good
order by August 24, 2018 at 6:00pm Eastern Time. PECO does not expect
funding to be available for standard repurchases for the remainder of
2018.

Advisors

BofA Merrill Lynch is acting as lead financial advisor with Citigroup
Global Markets Inc. and Goldman Sachs & Co. LLC also acting as financial
advisors to PECO. Latham & Watkins LLP is acting as legal advisor to the
board of directors of PECO. Morgan Stanley & Co. LLC is acting as
exclusive financial advisor and Hogan Lovells US LLP is acting as
exclusive legal advisor to the special committee of REIT II.

Conference Call

PECO's Chairman and Chief Executive Officer Jeff Edison, Chief Financial
Officer Devin Murphy, and Executive Vice President Mark Addy will host a
presentation addressing the transaction on Thursday, July 19 at 10:00
a.m. Eastern Time.

Interested parties will be able to access the presentation online or by
telephone. If dialing in, please call the conference telephone number
five minutes prior to the start time as an operator will register your
name and organization. Participants should ask to join the "Phillips
Edison & Company" call.

Date: Thursday, July 19, 2018

Time: 10:00 a.m. Eastern Time

Webcast link: https://services.choruscall.com/links/peco180719-10.html

U.S. listen-only: (888) 346-2646

International listen-only: (412) 317-5249

A webcast replay will be available approximately one hour after the
conclusion of the presentation in the Events & Presentations section of
the Phillips Edison & Company website at http://investors.phillipsedison.com/event.

For investor-related updates on Phillips Edison, please visit http://www.phillipsedison.com/investors.

About Phillips Edison & Company

Phillips Edison & Company, Inc., an internally-managed REIT, is one of
the nation's largest owners and operators of grocery-anchored shopping
centers. Its diversified portfolio of well-occupied neighborhood
shopping centers has a mix of national and regional retailers selling
necessity-based goods and services, in strong demographic markets
throughout the United States. As of March 31, 2018, the company manages
341 shopping centers - 237 are owned directly comprising approximately
26.4 million square feet located in 32 states. The company's proven,
vertically-integrated operating platform allows it to effectively and
efficiently acquire, lease and manage its properties, resulting in a
history of strong operating results and great shopping experiences. For
more information, please visit www.phillipsedison.com.

About Phillips Edison Grocery Center REIT II, Inc.

Phillips Edison Grocery Center REIT II, Inc. is a public non-traded REIT
that owns well-occupied grocery-anchored neighborhood shopping centers
with a mix of national and regional retailers selling necessity-based
goods and services, in strong demographic markets throughout the United
States. As of March 31, 2018, the company owned an institutional quality
retail portfolio consisting of 86 grocery-anchored shopping centers
totaling approximately 10.3 million square feet. For more information,
please visit the company website at www.grocerycenterREIT2.com.

Additional Information and Where You Can Find It

PECO and REIT II intend to file a joint proxy statement/prospectus on
Form S-4 in connection with the merger. Investors are urged to read
carefully the joint proxy statement/prospectus and other relevant
materials because they contain important information about the merger.
Investors may obtain free copies of these documents and other documents
filed by PECO or REIT II with the SEC through the website maintained by
the SEC at www.sec.gov.
Investors may obtain free copies of the documents filed with the SEC by
PECO by going to PECO's corporate website at www.phillipsedison.com
or by directing a written request to: Phillips Edison & Company, Inc.,
11501 Northlake Drive, Cincinnati, OH 45249, Attention: Investor
Relations. Investors may obtain free copies of documents filed with the
SEC by REIT II by going to REIT II's corporate website at www.grocerycenterREIT2.com
or by directing a written request to: Phillips Edison Grocery Center
REIT II, Inc., 11501 Northlake Drive, Cincinnati, OH 45249, Attention:
Investor Relations. Investors are urged to read the joint proxy
statement/prospectus and the other relevant materials before making any
voting decision with respect to the merger.

PECO and its directors and executive officers and REIT II and its
directors and executive officers may be deemed to be participants in the
solicitation of proxies from the stockholders of each of PECO and REIT
II in connection with the merger. Information regarding the interests of
these directors and executive officers in the merger will be included in
the joint proxy statement/prospectus referred to above. Additional
information regarding certain of these persons and their beneficial
ownership of PECO common stock is also set forth in the Definitive Proxy
Statement for PECO's 2017 Annual Meeting of Stockholders, which has been
filed with the SEC. Additional information regarding certain of these
persons and their beneficial ownership of REIT II's common stock is set
forth in the Definitive Proxy Statement for REIT II's 2017 Annual
Meeting of Stockholders, which has been filed with the SEC.

Forward-Looking Statements

Certain statements contained in this press release may be considered
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), and Section
21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), including statements regarding the transaction and the ability to
consummate the transaction and anticipated earnings, distribution
coverage, distributions and other anticipated benefits of the
transaction. We intend for all such forward-looking statements to be
covered by the safe harbor provisions for forward-looking statements
contained in Section 27A of the Securities Act and Section 21E of the
Exchange Act, as applicable. Such statements include, in particular,
statements about PECO's plans, strategies, and prospects and are subject
to certain risks and uncertainties, as well as known and unknown risks,
which could cause actual results to differ materially from those
projected or anticipated. Therefore, such statements are not intended to
be a guarantee of PECO's performance in future periods. Such
forward-looking statements can generally be identified by our use of
forward-looking terminology such as "pro forma," "may," "will," "would,"
"could," "should," "expect," "intend," "anticipate," "estimate,"
"believe," "continue," or other similar words. Readers are cautioned not
to place undue reliance on these forward-looking statements, which speak
only as of the date of this release. PECO makes no representation or
warranty (express or implied) about the accuracy of any such
forward-looking statements contained in this release, and does not
intend, and undertakes no obligation, to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.

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