Deutsche Wohnen Declines on Capital Increase: Frankfurt Mover

June 12 (Bloomberg) -- Deutsche Wohnen AG fell for a fourth day in Frankfurt trading after the German residential landlord said it would sell more shares than some analysts expected to pay for an acquisition.

Deutsche Wohnen dropped 0.8 percent to 11.54 euros at the close of trading, the lowest in two weeks. The stock has declined 8.4 percent in four sessions, cutting the company’s market value to 1.69 billion euros ($2.1 billion).

The Frankfurt-based company announced a plan to raise as much as 475 million euros in a capital increase yesterday. Most of the proceeds will be spent on the purchase of almost 23,500 apartments from Barclays Plc, a transaction valued at 1.24 billion euros.

“The capital increase was a bit higher than expected,” said Kai Klose, an analyst at Berenberg Bank with a buy rating on the stock. Klose expected Deutsch Wohnen to raise about 380 million euros from the share sale. Frank Neumann, an analyst at Bankhaus Lampe who also has a buy rating, anticipated that the company would seek about 300 million euros.

Both analysts said the additional capital will enable Deutsche Wohnen to make more acquisitions, which will probably bolster the stock in the months ahead.

Deutsche Wohnen has climbed 10 percent in the last 12 months, while Germany’s DAX Mid-Cap Index has lost 5 percent.

To contact the reporter on this story: Dalia Fahmy in Berlin at dfahmy1@bloomberg.net.

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net.