CA Immo, Immofinanz Cool Down Austrian Property Takeover

A takeover battle between Austria’s two biggest commercial property companies petered out today as CA Immobilien Anlagen AG fell short of its targeted stake in Immofinanz AG and Immofinanz dropped its counteroffer.

CA Immo’s 423 million-euro ($457 million) tender offer for 13.5 percent of Immofinanz was accepted only for 1.6 percent of the shares, Vienna-based CA Immo said in a statement today. Earlier, Immofinanz abandoned its counter-bid for 29 percent of CA Immo, saying in a statement late yesterday that the stake wouldn’t yield the desired influence over its competitor.

The developments signal an end to a battle of Vienna’s two biggest commercial developers that had grown increasingly acrimonious since CA Immo’s approach became public in February. After insults were traded and court rulings sought in the past two months, key shareholders of both companies said today they are interested in working together.

CA Immo, which bid for Immofinanz together with its main shareholder, Russian billionaire Boris Mints’s O1 Group Ltd., now holds 6.1 percent of Immofinanz, making it the second biggest shareholder, it said. Immofinanz fell 3 percent to 2.744 euros by 11:55 a.m. in Vienna, still 14 percent higher than before CA Immo’s approach emerged on Feb. 24.

Rudolf Fries, Immofinanz’s biggest shareholder, according to data compiled by Bloomberg, said the atmosphere between the companies may improve after shareholder meetings held this month. A “joint future” might be “sensible,” he said in an interview with Format magazine.

Talks about a merger of the two companies had faltered last year, in part due to disagreement over who would control the joint enterprise. The two then made hostile bids to buy minority stakes in each other. Both sides have said that a merger between them makes sense in the longer term. A combined entity would own property of more than 10 billion euros, creating one of central Europe’s largest developers.

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