Soffin acquires 47% of Hypo and eyes rest

The German government, through the bank rescue fund Soffin, holds 47.31% of the shares of Hypo Real Estate Holding following the expiration of the acceptance period for the EUR 1.39 per share offer tabled for the troubled property financier in mid-April.

Hypo Real Estate almost collapsed in a credit squeeze last October, and was only kept afloat by a EUR 50 bn bailout provided by the German government and German financial institutions. The government fears the failure of Hypo Real Estate, at one time the second-largest property lender in Germany, would destroy confidence in the country’s financial system - as happened globally when Lehman’s Brothers collapsed.

Although some shareholders continue to hold out, Soffin said on Thursday the acceptance period for the offer would not be extended. Soffin said nevertheless that it was confident the takeover could be 'continued swiftly' as an extraordinary general meeting of shareholders was expected to approve a capital increase which will be fully taken up by Soffin.

This will give Soffin a majority of 90% of the registered share capital and voting rights of Hypo Real Estate. 'Such a majority will enable the subsequent takeover of the shares of the remaining minority shareholders through a so called squeeze-out,' Soffin said.

Prof. Dr. Hannes Rehm, chairman of the Soffin Management Committee, commented: 'We will consistently pursue our efforts to stabilise Hypo Real Estate. The bank is of systematic relevance and must be rescued in order to ensure stability of the financial markets and the German economy.'

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