Vonovia Lacks Deutsche Wohnen Shares as Deal Deadline Nears

Vonovia SE, fighting to secure control of Deutsche Wohnen AG in what would be Germany’s biggest-ever property deal, is still well short of the shares it needs to succeed.

Vonovia, Germany’s largest homeowner, had 96.8 million Deutsche Wohnen shares, or about 28.7 percent of the total, as of Monday at 6 p.m. local time, Vonovia said on its website on Tuesday. That includes about 5 percent that Vonovia bought itself. The Bochum-based company needs 168.7 million shares, or 50 percent, by midnight today for the 8 billion-euro ($9 billion) deal to succeed.

The result puts into question whether Vonovia will win an increasingly hostile takeover battle in which it sought to cement its position as Europe’s biggest publicly traded homeowner, with more than 500,000 mid-priced apartments in cities such as Berlin, Frankfurt and Cologne.

Vonovia Chief Executive Officer Rolf Buch said the deal would save shareholders 84 million euros in costs annually. Deutsche Wohnen CEO Michael Zahn countered that the savings couldn’t be achieved and that the offer price was too low.

"I expect the deal will fail," said Michael Seufert, an analyst at Norddeutsche Landesbank in Hanover who has a buy rating on Deutsche Wohnen and a hold on Vonovia. "Investors don’t see the value in it."

Deutsche Wohnen shareholders including MFS Investment Management, the company’s biggest owner, have spoken out against the deal. The investors have balked at the price and said Vonovia should focus on operations instead of acquisitions.

On Jan. 25, with the percentage of acceptances at about 21 percent, Vonovia lowered the threshold to 50 percent from 57 percent and extended the offer period by two weeks.

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