Vonovia, Germany's largest listed residential landlord, has issued a five-year bond with a total value of €3 bn and a weighted interest of 1.69% per year.
Vonovia, Germany's largest listed residential landlord, has issued a five-year bond with a total value of €3 bn and a weighted interest of 1.69% per year.
The bond, which was placed in three instalments, marks the largest Eurobond ever issued in the real estate market.
The company said the proceeds of the issue will be used for general corporate purposes and to reduce the bridge loan obtained to finance the cash component of the takeover offer for Deutsche Wohnen.
'Our bond was more than two times oversubscribed by long-term, reliable investors, including sovereign wealth funds,' said chief financial officer Stefan Kirsten. 'This demonstrates the confidence of domestic and international capital markets in our strategy and business model. It also confirms investor confidence in our planned combination with Deutsche Wohnen.'
The group last week received the green light from Germany's national competition regulator for its bid to acquire its nearest rival, Deutsche Wohnen, and create a colossus with more than 500,000 apartments and a market capitalisation of €20 bn.
The approval was an important pre-condition for Vonovia to press ahead with its share offer, which has been rejected by Deutsche Wohnen's board.
The tender offer was officially launched on 1 December and Deutsche Wohnen shareholders have until 26 January to tender their shares. Vonovia is offering seven of its shares and €83.14 in cash for every 11 Deutsche Wohnen shares. This values Deutsche Wohnen at €26.46 per share.
As end-September 2015, Deutsche Wohnen's portfolio included more than 149,000 residential and commercial units with a fair value of around €10.7 bn. Vonovia's 370,000-unit portfolio was valued at €23.1 bn at the end of the third quarter.
