This time, the most important major shareholders of the real estate financier support the takeover bid by a bidding consortium.
(Photo: dpa)
Frankfurt Aareal Bank’s Management Board has given the go-ahead for the second takeover attempt by a consortium of bidders. The Wiesbaden real estate financier announced this in a mandatory notification on Wednesday evening. This step was necessary because the bidders were not allowed to make a new attempt for a year after the failure of the first bid two months ago. The financial regulator Bafin still has to agree.
Aareal Bank and the Atlantic Bidco bidder consortium, which is backed by the venture capital firms Advent and Centerbridge and the Canadian pension fund CPPIB, also renewed their investor agreement. In it, the potential future owners undertake to support the bank’s growth course and not to sell the sought-after IT subsidiary Aareon for at least three years.
In addition, the power struggle between the management of Aareal Bank and its activist major shareholders at the Annual General Meeting is now cancelled: the shareholders’ meeting planned for May 18, which should have decided, among other things, on a dividend, will be postponed, according to the statement.
The bank justified this with the new attempt by the bidder consortium to take over the majority in Aareal Bank. The Executive Board and the Supervisory Board, “after a thorough examination, assume that the transaction is more likely to be successful,” the statement continues.
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Atlantic Bidco wants to offer shareholders 33 euros per share. This price already includes the dividend of EUR 1.60 per share announced by Aareal Bank, which the Annual General Meeting should have voted on.
Originally, there should have been a power struggle at the general meeting between Aareal Bank on the one hand and the hedge funds Petrus Advisers and Teleios on the other: Petrus Advisers wanted to replace a total of five supervisory board members of the real estate financier. One of the reasons for this was that, from the hedge fund’s point of view, the Supervisory Board of Aareal Bank had rejected what it considered to be a poor initial offer from the consortium of bidders.
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The chances for the candidates of the London hedge fund were good: At an extraordinary general meeting in December, Petrus Advisers had proposed three candidates for the supervisory board, whose election probably only failed due to a voting rights breakdown at the US bank Morgan Stanley.
At the regular general meeting planned for May, the critical investors even wanted to exchange five candidates on the supervisory board. That would probably have complicated a takeover attempt by Atlantic Bidco at a later date.
This time, however, the chances of a successful takeover by Atlantic Bidco are better. Unlike the recently failed takeover attempt, Advent, Centerbridge and CPPIB had this time secured the support of the critical major shareholders Petrus Advisers and Teleios. Overall, the consortium, which wants to take over at least 60 percent of the shares, already has commitments amounting to 37 percent of the votes.
Petrus, Teleios, Vesa Equity Investment and Talomon Capital may indirectly reinvest part of their Aareal investment: “Following a successful offer, these shareholders should hold an indirect non-voting stake of up to 25 percent in the bidder,” announced Aareal Bank.
More: Financial institutions are particularly common targets for activist investors