When one company acquires another, investors need to make sure they understand what is happening. Sometimes, the purchase will be a slam dunk for everyone; other times, the outcome will seem less certain.

A closer look at Realty Income's (NYSE: O) acquisition of peer Spirit Realty (NYSE: SRC) can help explain what is meant by this dichotomy.

Realty Income is the largest net lease real estate investment trust (REIT) in the market. Net leases require tenants to pay most property-level operating costs. The REIT's market cap is a massive $36 billion, and it owns over 13,000 single-tenant properties. Add an investment-grade-rated balance sheet and 29 consecutive years' worth of annual dividend increases, and you can see why Realty Income is a Wall Street favorite.

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Source Fool.com