Deutsche Wohnen CEO Zahn Says Not Opposed to Being AcquiredDalia Fahmy
Deutsche Wohnen AG, Germany’s second-biggest listed property company, would not stand in the way of a takeover by a larger competitor if such a deal would be better for shareholders.
“I’m always thinking about what’s best for investors,” Deutsche Wohnen Chief Executive Officer Michael Zahn said on a conference call with analysts and reporters to discuss 2014 earnings. Asked if the Berlin-based company wouldn’t be opposed to being bought if the result is better for investors, Zahn said: “Exactly.”
Germany’s residential property companies, taking advantage of favorable financing conditions, are expanding at the fastest rate ever. Low interest rates make it cheaper for landlords to take out loans, and rising stock prices are boosting shareholder support for deals.
Residential properties valued at 27 billion euros ($30 billion) changed hands in the past two years, compared with 18 billion euros in the previous two years, according to data compiled by Jones Lang LaSalle Inc. Deutsche Annington Immobilien SE, Germany’s biggest landlord, this year completed the acquisition of Gagfah SA for 3.9 billion euros. Deutsche Wohnen is negotiating to buy Austria’s Conwert Immobilien Invest SE for 980 million euros.
At its annual shareholder meeting on April 30, Deutsche Annington will ask shareholders to approve the raising of about 11 billion euros in fresh capital, through the sale of shares and bonds. While Deutsche Annington isn’t obliged to get the full amount, the approvals are intended to allow the company to make acquisitions quickly if necessary, according to the agenda for the meeting.
“It’s reasonable to say that the companies would be a good fit,” said Peter Papadakos, managing director at Green Street Advisors in London, referring to Deutsche Wohnen and Deutsche Annington.