Vonovia to sell 1 billion euro stake in residential portfolio to Apollo – Reuters.com

The new headquarters of German real estate company Vonovia is pictured in Bochum, Germany, April 24, 2018. REUTERS/Wolfgang Rattay/File Photo Acquire Licensing Rights
BERLIN, April 26 (Reuters) – Vonovia (VNAn.DE) has agreed to sell a minority stake in its Suedewo residential portfolio to U.S. investor Apollo for 1 billion euros ($1.10 billion), Germany's largest real estate group said on Thursday.
The transaction could have a signal effect on the struggling German real estate market, where hardly any major sales have occurred in recent months in the face of high interest rates and falling real estate prices.
The transaction values the Suedewo portfolio in the southwestern state of Baden-Wuerttemberg at 3.3 billion euros, which is a discount of less than 5% to Suedewo's fair value as of December 31, Vonovia said.
The German group, which will continue to manage the portfolio of more than 21,000 residential units, has agreed to a long-term buy-back option without an obligation to do so, at an internal rate of return (IRR) of 6.95%-8.30% including dividends received, it said.
With the proceeds, Vonovia will generate around half of the targeted 2 billion euros in free cash flow from asset sales.
"Not the big bang, and sold 5% below recent fair value, but should be viewed as a first step in the right direction," a local trader commented following the announcement.
Vonovia's stock rose 2.6% at 0733 GMT to the top of Germany's blue chip index (.GDAXI).
To secure access to capital amidst the property market crisis, the group earmarked properties worth 13 billion euros for sale in the summer.
($1 = 0.9108 euros)
Reporting by Tristan Veyet, Kirsti Knolle, Editing by Friederike Heine
Our Standards: The Thomson Reuters Trust Principles.
UAW President Shawn Fain will tell a Senate Committee the union plans to aggressively organize non-union U.S. auto plants after winning new contracts with the Detroit Three automakers.
Reuters, the news and media division of Thomson Reuters, is the world’s largest multimedia news provider, reaching billions of people worldwide every day. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers.
Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology.
The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs.
The industry leader for online information for tax, accounting and finance professionals.
Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile.
Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts.
Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks.
All quotes delayed a minimum of 15 minutes. See here for a complete list of exchanges and delays.
© 2023 Reuters. All rights reserved

source


Posted

in

by

Tags:

Comments

Leave a Reply

Your email address will not be published. Required fields are marked *