AI Sentiment: Bullish
Reason: Vonovia, having already successfully taken over Deutsche Wohnen, is now looking to acquire its minority shareholders, further strengthening its market position. This move indicates growth and is expected to lower costs and streamline operations.
In a recent development, Vonovia, Germany's largest residential property company, has made an offer to acquire the minority shareholders of Deutsche Wohnen, thus further strengthening its position in the real estate market. The move comes after Vonovia successfully took over Deutsche Wohnen in a deal worth 19.1 billion euros ($21.8 billion) last year, which resulted in the creation of a property giant with around 500,000 apartments.
As of now, Vonovia holds approximately 94% of Deutsche Wohnen's share capital. The company is offering 52.68 euros for each Deutsche Wohnen share, which is equivalent to the weighted six-month average price. This offer represents a premium of about 16% over Deutsche Wohnen's closing price on February 18, 2022. The transaction is subject to approval by Vonovia's shareholders and is expected to close in the second quarter of 2022.
The purpose of this move is to simplify the group structure and lower costs. The buyout will enable Vonovia to fully integrate Deutsche Wohnen into its operations, leading to streamlined processes and synergies. Furthermore, it will eliminate the need for Deutsche Wohnen to maintain its stock market listing, reducing related expenses.
It's worth noting that this is not the first time Vonovia has attempted to acquire Deutsche Wohnen. The company had previously failed twice in its takeover bids. However, the third attempt in 2021 was successful, marking a significant milestone in Vonovia's growth strategy.
The consolidation of the German real estate market is indicative of the increasing attractiveness of the sector as an investment. The merger of Vonovia and Deutsche Wohnen has set a new precedent in the industry, potentially paving the way for further mergers and acquisitions.