Aareal shareholder Petrus calls purchase offer “extremely low”

Aareal Bank is based in Wiesbaden

The takeover offer for the bank was submitted by a group of investors around Advent and Centerbridge.

(Photo: dpa)

Frankfurt The letter that the two Petrus Advisers partners Klaus Umek and Till Hufnagel sent to the Supervisory Board and Management Board of Aareal Bank is three pages long. The top management is unlikely to like the content, as the activist investor is attacking the takeover offer that Aareal has just agreed on with a group of bidders around the ventures Advent and Centerbridge.

For Petrus, the offer for the German real estate financier of 29 euros per share is “extremely low”. In the letter dated December 20, Umek and Hufnagel complain that those responsible for Aareal maneuvered the bank into a takeover situation that the shareholders did not want instead of developing a promising strategy. The bank is now being “hastily sold to private equity investors”.

According to its own information, Petrus Advisers holds between 15 and 20 percent of the shares in Aareal Bank, making it one of the largest individual shareholders. The Bloomberg news agency had first reported on the fire letter.

The takeover offer for the bank is supported by the Board of Management and the Supervisory Board. The acceptance period for shareholders is expected to end on January 19 at midnight. In addition to Advent and Centerbridge, the group of bidders also includes a number of other investors. Most recently, the Canadian pension fund CPP took a 20 percent stake in the consortium that Aareal Bank intends to buy.

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Peter’s letter contains a long list of questions about the deal that show how critical Peter is of the offer. Among other things, the investor wants to know whether the bidders have promised the current management a more lucrative remuneration system. Petrus also criticizes the fact that Aareal’s management has committed itself not to make any efforts to promote a more attractive offer from another bidder. This clause is equivalent to a “sabotage of possible alternative offers”, it says in the letter.

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Previously, other investors had already expressed reluctance to the takeover offer. “This clandestine offer process is another attempt by Aareal Bank’s Supervisory Board to make things easy for itself to the detriment of shareholders,” said Adam Epstein, co-founder of the hedge fund Teleios Capital, which is also part of Aareal Bank, at the end of November.

The bank wants to answer Petrus’ long list of questions as part of regular communication with investors.

Criticism of the Aareal General Meeting

The activist investor is not only sharply critical of the planned takeover but also of the most recent general meeting. At the extraordinary shareholders’ meeting, Petrus was able to prevail by voting out a total of three supervisory boards of the institute. But there was no majority for his own candidates.

The result: three seats on the supervisory body remain empty for the time being. In doing so, Petrus failed to achieve his most important goal of gaining more influence on the decisions of the bank.

Now the investor is complaining about alleged irregularities at the annual general meeting: “In the opinion of our proxy advisors, substantial errors were made in the voting or the counting of votes. The actual result of the vote was most likely even clearer. “Petrus calls on the bank to” do everything possible to clear up any errors in the vote transparently “. An Aareal spokeswoman rejected the major shareholder’s allegations.

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