German property mega-deal goes from bad to worse

Deutsche Wohnen SE

14/09/2021 10:36

(The author is a Reuters Breakingviews columnist.  The opinions
expressed are their own.)
    LONDON, Sept 14 (Reuters Breakingviews) - German
landlord Vonovia’s  VNAn.DE  19 billion euro bid for rival
Deutsche Wohnen  DWNG.DE  is looking like a botched job. Having
already once extended the deal, Vonovia Chief Executive Rolf
Buch  urn:newsml:reuters.com:*:nL8N2QF4MP now says he will go ahead with his 53 euros
per share offer even if he secures less than 50% of the target’s
stock. So far, Buch has snagged just over 40% support, despite
sweetening the initial 52 euros a share bid.  
    Vonovia had already signalled it would proceed if it doesn’t
get enough shares to delist Deutsche Wohnen  urn:newsml:reuters.com:*:nL8N2PC75J. Now,
if it ends up with less than 50% of the shares, it could be
harder to control the company. Buch has repeated threats that
Vonovia might in the future force Deutsche Wohnen to cancel its
dividends, in order to boost investment and cajole the target’s
shareholders to sell. But that could be harder with less than a
50% stake. Like a rickety building, this deal will need plenty
of patching up. (By Aimee Donnellan)  
    On Twitter http://twitter.com/breakingviews
    Capital Calls - More concise insights on global finance:
    
    Grab hints at Southeast Asia’s economic pain  urn:newsml:reuters.com:*:nL4N2QG164
    Fake Walmart-Litecoin news cries for regulation  urn:newsml:reuters.com:*:nL4N2QG01Y
   
    UK takes friendly fire in latest vaccine spat  urn:newsml:reuters.com:*:nL8N2QF1YO
    Blackstone moves out of China property deal  urn:newsml:reuters.com:*:nL4N2QF0CI
    U.S. debt ceiling fight is warming up  urn:newsml:reuters.com:*:nL4N2QG073

 (Editing by Neil Unmack and Karen Kwok)
 ((SIGN UP FOR BREAKINGVIEWS EMAIL ALERTS: http://bit.ly/BVsubscribe))