Viennese real estate company S Immo has received a request from shareholder Prague-based CPI Property Group, to convene an extraordinary shareholders’ meeting, the motion of which is to remove S Immo’s 15 pct maximum voting rights ceiling and thus allow CPI to proceed with a takeover bid.
According to the request, the resolution will require merger control clearance in Austria, Germany, Hungary, Romania, Serbia and Slovakia in order to take effect.
The strategy announced today is another logical step forward in CPI PG’s evolution from a regional leader into a European real estate champion.
Martin Němeček, the CEO of CPI PG
Last December, CPI acquired a 10.8 pct stake in S Immo, when the latter launched a counter-bid to CPI’s takeover of S Immo’s Austrian rival Immofinanz. S Immo eventually conceded defeat and sold its 12.69 pct stake in Immofinanz to CPI earlier this year. CPI has since brought its shareholding in S Immo up to 16.1 pct. Radovan Vítek, the owner of CPI, now holds a 55 pct stake in Immofinanz. Since Immofinanz also owns a 26.5 pct stake in S Immo, as a result of CPI’s takeover of Immofinanz it now directly or indirectly owns 42.6 pct of S Immo.
In June 2021, Immofinanz called off its own takeover bid for S Immo, after the shareholders of the latter refused to revoke the voting cap.
According to a CPI announcement: “S Immo’s articles of incorporation include an unusual voting cap feature which limits the voting rights of shareholders to 15 pct, regardless of their actual shareholding. In recent years, the voting cap along with the inefficient cross-ownership between Immofinanz and S Immo has prevented shareholders from driving an effective long-term strategy, resulting in failed mergers and share price underperformance.”
If the voting cap is abolished, CPI intends to press on with a mandatory takeover offer for all outstanding shares of S Immo that it does not yet own. This would be priced at EUR 22 per S Immo share cum dividend. The offer is to be financed by CPI’s own capital resources as well as a EUR 1.25 bln bridge loan facility provided by: Banco Santander, Bank of China, Barclays Bank, Credit Suisse, Goldman Sachs Bank, Raiffeisen Bank International, Société Générale, Komerční Banka, UniCredit Bank Austria, and UniCredit Bank Czech Republic and Slovakia.
S Immo invests exclusively in the EU with a focus on capital cities in Austria, Germany and the CEE region, which accounts for 33 pct of the total. At the end of Q3 2021, its portfolio comprised 367 properties with a book value of more than EUR 2.7 bln with an occupancy rate of 93 pct and an overall rental yield of 5 pct. Around 70 pct of the portfolio consists of commercial properties (offices, shopping centres and hotels), with residential making up the remaining 30 pct.
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