Status: 23.07.2021 5:50 p.m.
Too few shareholders agreed: Germany’s largest housing group Vonovia has probably failed again with its plan to take over rival Deutsche Wohnen. It would not be the first time.
The acquisition of the Berlin real estate group Deutsche Wohnen by the competitor Vonovia is about to end. The group announced today in Bochum that the minimum acceptance rate for Vonovia’s voluntary offer to shareholders will probably not be achieved. Management does not assume that it will increase significantly in the remaining time.
So far, according to Vonovia, only 47.62 percent of the shareholders have accepted the offer. An essential condition for the execution of the offer is, however, a minimum acceptance threshold of more than 50 percent. In the evening, the deadline ended in which shares that arrived late can still be booked. The final result will be announced on Monday.
Takeover attempt failed in 2016
How it will continue is still open. “We will now carefully examine the possible options, such as a sale of the shares currently held by Vonovia in Deutsche Wohnen, a new public offer or the acquisition of additional shares,” said Vonovia boss Rolf Buch. For him it was another setback. Five years ago he had tried in vain to take over the second in the industry.
Even then, the minimum acceptance rate for the billions in the offer was not reached. In contrast to the new offer, the management board of Deutsche Wohnen had classified the offer as hostile and fiercely opposed the plan. Now both companies are campaigning for a merger. The management board and supervisory board of Deutsche Wohnen had recommended that their shareholders accept the takeover offer. The necessary investments in affordable housing, climate protection and new buildings could be shouldered better together.
With the takeover, Vonovia wanted to forge Europe’s largest real estate group with around 550,000 apartments worth more than 80 billion euros. “Vonovia continues to be of the opinion that a merger with Deutsche Wohnen makes strategic sense and creates added value for the shareholders of both companies,” said the announcement.
The Federal Cartel Office had already agreed
The Federal Cartel Office had already given the green light for the merger of the two largest German residential property groups in June. The joint market shares of the companies did not justify a prohibition of competition law, the competition watchdogs had announced. They referred to the example of Berlin, where of the nearly 1.7 million rental apartments in the city, around 150,000 were owned by Deutsche Wohnen and Vonovia.
In order to take the criticism of the mega deal off the top, Vonovia had undertaken to limit the annual rent increases in Berlin to a maximum of one percent per year for the next three years. Both groups also agreed with the Senate on the sale of around 20,000 residential units to the country. Berlin is trying to buy back living space in order to better regulate the rental market.
Stocks under pressure
Vonovia and Deutsche Wohnen share prices came under significant pressure in the afternoon after the announcement. However, after the first downturn, they reacted differently to the possible failure of the takeover. While Vonovia shares remained in the red and recently fell by 1.6 percent to EUR 58.28, Deutsche Wohnen quickly recovered.
Buch pointed out that significant parts of Deutsche Wohnen’s shares are currently held by hedge funds and also by index funds, which are only allowed to trade once the minimum acceptance rate has been reached.