The deal accelerates consolidation of the global retail property sector as it grapples with challenges from online retailers led by Amazon.com. It comes on the heels of world No. 2 retail real estate investment trust GGP's rejection of a $14.8 billion offer from Brookfield Property for the two-thirds it did not already own.
Westfield, which owns and operates 35 shopping centers in the United States and United Kingdom valued at $32 billion, said the transaction was "highly compelling" for Westfield and Unibail-Rodamco's shareholders.
"Unibail-Rodamco's track record makes it the natural home for the legacy of Westfield's brand and business," Westfield Chairman and co-founder Frank Lowy said in a statement.
Unibail-Rodamco said Westfield shareholders would receive a combination of cash and shares, valuing Westfield at $7.55, or A$10.01 a share, an 18 percent premium to Westfield's last trade.
Including debt, the deal would be worth $24.7 billion.
Unibail-Rodamco said the deal would create a global property leader with $72 billion of gross market value in 27 retail markets. It will rebadge its malls with the red Westfield logo.