British Columbia Investment Management Corp. (BCIMC) has struck a $1.2 billion deal to acquire Canadian Hotel Income Properties Real Estate Investment Trust (CHIP REIT).

The parties announced today that the pension fund for B.C. public sector workers is offering $19.10 per unit for the hotel operator.

Under banners that include Delta, Radisson, Marriott and Hilton, CHIP REIT owns and manages 32 hotels with about 7,700 guest rooms. BCIMC is based in Victoria with over $85 billion in assets under administration.

The deal represents a 34% premium over the closing price of CHIP REIT units on July 31, the companies said in a release. BCIMC has also agreed to acquire all outstanding CHIP REIT 6% convertible debentures for a price of $1,625.53 per $1,000 debenture.

“As one of Canada’s best-run hotel businesses, CHIP REIT will be a strong complement to our diversified portfolio of assets and contribute to our ability to help finance the retirement benefits of more than 400,000 residents of British Columbia,” said Doug Pearce, CEO of the B.C. pension fund, in a release.

“CHIP REIT will continue to pursue its existing strategy under its current management team following the successful conclusion of this transaction.”

BCIMC is an investment management corporation based in Victoria. With over $85 billion in assets under administration, its clients include public sector pension plans, provincial government, public trusts, and insurance funds.