FDL acquires EUR 100m of French residential assets

Foncière Développement Logements (FDL) has signed letters of intent with two of its institutional shareholders, Cardif and Covéa Group's MMA, for the transfer of 339 housing units in France to its real estate portfolio. The transaction value amounts to a total of EUR 100 mln, excluding transfer duties. FDL will pay for these assets through the issue of new shares at a price of EUR 18.

The properties are located in Paris and the Paris region as well as in Lyon. They generate a gross return upon acquisition of 4.8%, FDL said. Advanced negotiations with a third investor are pending, with a deal conditional on an additional EUR 25 mln asset contribution of 83 housing units, the company added.

The institutional shareholders of FDL, representing 97.2% of its capital, have agreed to hold their FDL shares for a period of one year starting from the transfer of the assets. To avoid dilution, FDL proposes that the other shareholders acquire their shares at a price of EUR 18 mln. To this end, it has filed a simplified public tender offer with the French stock market regulator AMF.

FDL also announced plans to adopt the form of a limited company (société anonyme) and to abandon its status as a limited partnership with a share structure (société en commandite par actions). Through the change, FDL will benefit from additional advantages to accelerate its growth, particularly through new transactions remunerated in shares, the firm said.