Market Overview

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

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

Meaningful step towards liquidity for REIT II shareholders from
increased scale and internalized management

No internalization or disposition fees to be paid by REIT II

Management to host conference call on Thursday, July 19 at 11:00 a.m.
Eastern Time to discuss the transaction

Phillips
Edison Grocery Center REIT II, Inc.
("REIT II"), a real estate
investment trust ("REIT") that owns well-occupied grocery-anchored
shopping centers, has entered into a definitive merger agreement to
merge with Phillips
Edison & Company, Inc.
("PECO"), an
internally-managed REIT and one of the nation's largest owners and
operators of grocery-anchored shopping centers. The transaction is a
100% stock-for-stock merger valued at 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 total enterprise
value ("TEV") of approximately $6.3 billion.

REIT II, as part of the combined company, will benefit from an internal
management team and the elimination of management fees, lower leverage,
improved distribution coverage, and better earnings growth
opportunities. Additionally, the combined enterprise will have larger
size and scale, broader tenant diversification, and a simpler, more
efficient operating platform. The merger also 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

"After closely evaluating the merits of this transaction, we are certain
this highly complementary business combination is in the best interests
of REIT II shareholders," said David W. Garrison, the chair of the
special committee of REIT II's board of directors. "It better positions
REIT II and the combined company for liquidity and provides REIT II
shareholders with the benefits of a company with an enhanced growth
profile, lower leverage, and the efficiencies of size and scale."

"The transaction consideration was the result of extensive negotiations
between the special committee and PECO. Upon the closing of the
transaction, REIT II shareholders are expected to benefit from an
internally-managed enterprise with improved alignment among shareholders
and management, and a mutual long-term view of increasing shareholder
value," Garrison continued.

Jeff Edison, Chairman and Chief Executive Officer of REIT II added:
"This transaction creates one of the largest pure-play grocery-anchored
shopping center portfolios, building on our belief that grocery-anchored
shopping centers are the strongest and most resilient assets in retail
real estate, supported by the strong operating fundamentals seen in our
portfolio. This transaction will enhance the long-term value and
liquidity opportunities for our shareholders."

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 between REIT
II and PECO will be terminated at closing, ending acquisition, asset
management, and disposition fees paid by REIT II. In 2017, REIT II paid
$13.9 million in acquisition and asset management fees; no disposition
fees were paid.

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
definitive merger agreement. On a pro forma basis, the combined
company's leverage is improved compared to REIT II stand-alone as
leverage would have been 42.5% on a Net Debt/TEV basis, compared to
42.9% for REIT II stand-alone, as of March 31, 2018. The pro forma
company's total debt is 86.8% fixed-rate with an average duration of 4.7
years, which compares to 89.7% and 3.2 years, respectively, for REIT II
prior to this merger.

On a pro forma basis, immediately following the closing of the
transaction, former REIT II shareholders are expected to own
approximately 29 percent of the combined company, and PECO shareholders
are expected to own approximately 71 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.

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

The transaction is expected to create meaningful operational and
financial benefits, including:

  • Enhances Potential Public Market Valuation and Actively Positions
    Company for Liquidity:
    REIT II shareholders will benefit from
    PECO's internally-managed structure, which is likely to receive a
    better valuation in the public equity markets compared to
    externally-managed REITs. This transaction is an important step
    towards a full cycle liquidity event for shareholders.
  • Maintains 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 portfolio will benefit from greater geographic,
    grocery-anchor, and tenant diversification.
  • No Internalization or Disposition Fees Paid: REIT II will not
    pay any internalization or disposition fees in connection with the
    transaction with PECO.
  • FFO Accretive from Termination of Asset Management Fees and
    Improved Financial Growth Profile:
    This transaction is anticipated
    to be accretive to REIT II FFO on a run-rate basis after 2018, as a
    result of the termination of the advisory agreement between REIT II
    and PECO in addition to the combined company growth profile. REIT II
    will no longer pay any acquisition, asset management, or disposition
    fees to PECO; in 2017, REIT II paid $13.9 million in advisory
    agreement fees. Additionally, PECO's investment management
    business provides multiple avenues for future growth.
  • Improves Distribution Coverage and Leverage Ratio While Maintaining
    Strong Balance Sheet:
    REIT II estimates that pro forma funds from
    operations (FFO) for the combined company would have been
    approximately 105% of pro forma total distributions for the first
    quarter of 2018, relative to actual coverage of 95% for REIT II
    stand-alone. Additionally, on a pro forma basis, the combined
    company's leverage would have improved to 42.5% on a Net Debt/TEV
    basis, compared to 42.9% for REIT II standalone, as of March 31, 2018.
    The pro forma company's total debt was 86.8% fixed-rate with an
    average duration of 4.7 years which compares to 89.7% and 3.2 years,
    respectively, for REIT II prior to this merger.
  • Efficient Integration: The Company expects a seamless
    integration process as PECO has managed these assets and the REIT II
    enterprise since inception.

Monthly Distributions

Pending closing, REIT II expects to continue to pay its annualized
distribution of $1.625 per share, paid on a monthly basis. Upon the
close of the transaction, the PECO board of directors expects to
continue making monthly distributions totaling $0.67 per year. Based on
the merger's exchange ratio of 2.04, the total annual dividend per REIT
II common share will be approximately $1.367 compared to $1.625 prior to
the transaction. Pro forma distribution coverage will improve as pro
forma FFO would have been approximately 105% of pro forma total
distributions for the three months ended March 31, 2018, compared to
actual coverage of 95% for REIT II stand-alone. Distributions are not
guaranteed and are made at the discretion of the board of REIT II (prior
to closing) and PECO (after closing).

Distribution Reinvestment Plan and Share Repurchase Program

In connection with the proposed transaction, REIT II 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 both standard requests, and death, disability, and
incompetence (DDI) requests 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. REIT II expects to make standard repurchases on
a pro-rata basis at that time.

Advisors

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. 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.

Conference Call

REIT II's Chairman and Chief Executive Officer Jeff Edison, Chief
Financial Officer Devin Murphy, and President and Chief Operating
Officer, Mark Addy will host a presentation addressing the transaction
on Thursday, July 19 at 11:00 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 "Grocery
Center REIT II" call.

Date: Thursday, July 19, 2018
Time: 11:00 a.m.
Eastern Time
Webcast link: https://services.choruscall.com/links/peco180719-REIT-II.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 Grocery Center REIT II website at http://investors.grocerycenterreit2.com/event.

For investor-related updates on Phillips Edison Grocery Center REIT II,
please visit http://www.grocerycenterreit2.com/investors.

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.

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.

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 REIT II'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 REIT II'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. REIT II 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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