Emmanuel Thomas, DPA, Wednesday, April 26, 2023
BERLIN – Germany’s largest residential real estate group Vonovia SE plans to raise money by selling a stake in a real estate portfolio.
Vonovia announced the sale of a minority common equity participation in its Sudewo portfolio to US investor Apollo, on behalf of its affiliated and third party insurance clients and other long-term investors, for €1 billion ($1.1 billion.
The transaction values the Sudewo portfolio at €3.3 billion on a debt-free and cash-free basis, implying a discount below 5% to its fair value as of December 31, 2022.
Vonovia said it retains a long-term call-option to repurchase the participation at an internal rate of return of 6.95%-8.3% – including dividends received – without an obligation to exercise the option.
Vonovia noted that it will continue to control, operate, and consolidate the portfolio, which comprises more than 21,000 residential units in locations across the south-western German state of Baden-Württemberg.
The closing of the transaction is expected to occur around May 31, 2023.
Vonovia intends to use the proceeds for liability management and to cover upcoming debt maturities.
