NETHERLANDS - Two listed real estate companies based in the Netherlands have agreed to merge to create a new cross-border investment fund listed on NYSE Euronext Amsterdam.

Vastned Offices/Industrial and Nieuwe Steen Investments (NSI) will combine to create a €2.4bn portfolio comprising more than 300 office and retail properties located in the Netherlands, Belgium, France, Germany and Switzerland.

Vastned Retail, another listed company of the Vastned Group, will not be included in the merger and so the retail assets will be derived exclusively from NSI.

The merging parties said the move was presented an opportunity to accelerate the growth of both businesses and provide economies of scale.

Johan Buijs, chief executive at NSI, said: "This combination of forces creates a new, Dutch leading, mixed real estate company offering shareholders exposure to both offices and retail markets.

"We are confident about the strategic rationale and the significant scale advantages offered by the combination with VastNed O/I.

"The merger fits well with our strategy and ambitions to play a leading role in the consolidating real estate investment industry."

Buijs said size was becoming an increasingly decisive factor when generating attractive returns for investors in the long term.

He said the merger would better enable the company to "compete for larger high-yield retail and office properties without affecting the risk profile".

Reinier van Gerrevink, chief executive at VastNed O/I, said: "Both parties have been in a constructive and open dialogue during the thorough discussions, and we are confident our shareholders will benefit from this proposed merger.

"NSI and VastNed O/I will benefit from significant scale benefits and have a stronger commercial position in the market."

The exchange ratio for the merger is set at 0.897 NSI shares for each Vastned O/I share.
Each Vastned O/I shareholder will also receive one 'value retention warrant' per share in relation to Vastned O/I's holding in Belgian property company Intervest.