German investor Alstria Office REIT has successfully closed its voluntary public takeover offer for DO Deutsche Office, in a deal that values its target at €800 mln.
German investor Alstria Office REIT has successfully closed its voluntary public takeover offer for DO Deutsche Office, in a deal that values its target at €800 mln.
Alstria said on Tuesday that it has received a 90.6% acceptance ratio from Deutsche Offer's shareholders for its share bid of 0.38 of a new bearer share for each Deutsche Office share.
New York-listed investor Oaktree Capital Group, which owned 60.54% of Deutsche Office, had already said it would commit its entire stake to the deal. Furthermore, alstria has a call option for a further 4.0% of Deutsche Office shares.
The offer was dependent upon a minimum acceptance rate of 69.6%.
The takeover will result in the creation of Germany's largest listed office real estate company.
Two-in-one
The combined portfolio comprising 125 office buildings with 1.7 million m2 of lettable space will be valued at €3.5 bn. The combined net loan-to-value will amount to roughly 50%, which Alstria will seek to bring down to 40% in the mid-term.
'Through the combination of both portfolios, alstria expects to reinforce its presence in Hamburg and the Rhine-Ruhr area and to achieve a critical size in Berlin, Stuttgart and Frankfurt, giving it a critical mass in 6 of the top 7 German office markets,' Alstria Office said in a statement to announced the deal this summer.
The combination will also provide Alstria's shareholders 'with access to a sizeable, profitable and well balanced office portfolio in Germany’s most dynamic growth regions while improving the group's capital market profile', it added.
Alstria said it expects a mark-down of €80 mln in value for the Deutsche Office portfolio by year-end 2015, which, combined with a potential write-down of goodwill resulting from the transaction, as well as costs associated with the deal, is expected to result in a net loss in Alstria's 2015 profit & loss account.
The integration is expected to be completed within 24 months after closing of the transaction.
UBS acted as financial advisor, Unicredit as a co-financial advisor and Allen & Overy as legal advisors to alstria on this transaction.