German real estate giant Vonovia fails in bid to take over rival

FRANKFURT - Germany's number one real-estate group Vonovia conceded defeat Wednesday in its battle to take over close rival Deutsche Wohnen.

As of midday on Wednesday, "the preliminary acceptance rate for the public takeover offer stood at approximately 30.4 percent," Vonovia said in a statement.

"Based on these preliminary figures, the minimum acceptance threshold of 50 percent set by Vonovia and which is necessary for the full realisation of the synergy potential of the contemplated transaction, has not been reached," it added.

Germany's real estate sector is currently riding a wave of mergers and acquisitions, as market players seek to take advantage of low interest rates and the relative lag in property prices compared with those in neighbouring countries.

And the Vonovia-Deutsche Wohnen tie-up would have been the biggest in the sector so far.

Since the beginning of last year, Vonovia, formerly known as Deutsche Annington, has got its hands on both rivals Gagfah and Suedewo for nearly six billion euros, boosting its portfolio to 370,000 residences across Germany.

A combination with Deutsche Wohnen would have created a new giant with 510,000 residences.

Vonovia was prepared to stump up billions for its rival, but Deutsche Wohnen dismissed the advances as "uninteresting and inappropriate."

"We extended an attractive offer to Deutsche Wohnen's shareholders and received a lot of support from the market over the past few weeks," said Vonovia chief executive Rolf Buch.

"Today we concede that the number of tendered shares are not sufficient to conclude the transaction successfully. The combination would have been a value-creating opportunity, further consolidating the market," Buch said.

But Vonovia's failure to get hold of Deutsche Wohnen "has no bearing on the continued successful development of the company," Buch insisted.

Copyright AFP
All rights reserved. This material may not be reproduced, published, broadcast,
rewritten or redistributed without prior permission in writing from AFP.

Get commercial property news by email

Free alerts when we publish — pick a focus or get everything, unsubscribe in one click. Subscribe »