Immofinanz is merging with Central and Eastern European developer CA Immo in a €604m deal.

The Austrian company is taking a 26% stake in CA Immo from the O1 Group and Terim, with closure scheduled for this summer.

The deal is subject to 75% shareholder approval.

Immofinanz last year said it was cutting its exposure to Russia, while exiting the logistics sector to concentrate on office and retail investments.

The company is focusing on Germany, Poland and its domestic market.

Oliver Schumy, chief executive at Immofinanz, said: “With the acquisition of the stake in CA Immo and the decision to dispose our Russian portfolio, we now have created the basis for this merger.

“The portfolios of both companies are very complimentary, and we expect significant synergies from the transaction.” 

CA Immo chief executive Frank Nickel Substantial said synergies could be created from the merger.

TriGranit, a Central European developer partly owned by Immonfinanz, was last year sold to US private equity investor TPG Real Estate.