US property investment firm Starwood Capital Group has acquired Immofinanz's 26% stake in Austrian property group CA Immo for a total investment of €758 mln, or €29.5 a share.
The deal represents a 7% premium on Starwood's initial voluntary offer of €27.5 a share and is roughly 3% higher than CA Immo's share price on the day prior to the announcement.
Starwood first announced in April that it was seeking to buy up to 26% of CA Immo, just a few days after Vienna- and Warsaw-listed property group Immofinanz - the largest shareholder in CA Immo with a 26% stake - announced the launch of a structured bidding process to dispose of its 26% shareholding.
Immofinanz's 25.7 million ordinary shares in CA Immo were worth some €700 mln at the time. The company's holdings also included four registered shares which carry the right to appoint members to the supervisory board.
Immofinanz is making a 30% profit on the divestment, having bought the shares just over two years ago for around €600 mln. At the time, Immofinanz planned to merge its business with CA Immo to create one of the biggest real estate groups in Central and Eastern Europe. In February this year the company said that it is considering new, more profitable options with regards to its stake, including the potential profitable sale of its shares.
The CA Immo shares were carried on Immofinanz’s balance sheet at €695 mln as of 31 March 2018. Closing is expected to take place in Q3 2018.
In tandem with the sale to Starwood, Immofinanz also announced that it will use part of the proceeds to buy back up to 9.7 million of its own shares.
'The sale of our investment close to the historical high of the CA Immo share price allows us to realise a substantial profit and will also strengthen our capital structure through the repayment of the related financing,' commented Oliver Schumy, CEO of Immofinanz. 'In view of the group’s solid overall liquidity and the relatively high discount of the share price to the book value and EPRA NAV per share, we want to use part of these funds for the repurchase of further shares up to a volume of 9.7 million.'