Immofinanz AG shareholders should vote against a 531 million-euro ($579 million) bid for part of rival CA Immobilien Anlagen AG because the reasoning behind the deal is unclear, ISS Proxy Advisory Services said.
“The overall level of disclosure provided by the company falls short of market practice,” the advisory firm said in a report ahead of an April 17 Immofinanz shareholder meeting, where a vote on the deal will be held. Immofinanz also didn’t explain how it would get the necessary cash if its offer for 29 percent for CA Immo wins full acceptance, ISS said.
On March 16, CA Immo offered to buy 13.5 percent of Immofinanz together with Russian investor Boris Mints for 2.80 euros per share. Immofinanz responded by offering to buy the stake in CA Immo. The two bids come after merger talks between the companies broke down last year.
ISS’s advice echoes comments made by Teleios Capital Partners LLC, another adviser to Immofinanz investors. Immofinanz should reassess its counteroffer for CA Immo because the case for buying an illiquid stake without obvious benefits hasn’t been made, Teleios said in a letter to the supervisory board dated March 31.