GE Capital

, a unit of

General Electric

(GE) - Get Report

, signed an agreement to acquire

Franchise Finance Corp. of America

(FFA) - Get Report

for about $1.4 billion.

Stockholders of Franchise Finance, a real estate investment trust, will receive $25 in cash for each of their shares. The company, which is based in Scottsdale, Ariz., has 56.1 million shares outstanding, giving the agreement a value of about $1.4 billion.

The acquired company will operate as

Franchise Finance Corp. of America

, a division of

GE Capital Commercial Equipment Financing

. The acquisition is designed to improve GE's place in the franchise finance market.

In recent trading on the

New York Stock Exchange

, Franchise Finance gained $1.19, or 5%, to $24.91. GE, which is based in Fairfield, Conn., was up 7 cents, or 0.2%, to $41.47.