Vonovia Resolves On EUR 8 Bln Underwritten Capital Increase

German residential real estate company Vonovia (DAIMF) said that it plans to raise about 8 billion euros in a capital increase to partly finance its takeover of Deutsche Wohnen.

Vonovia said it, with the consent of the supervisory board, has resolved to launch a fully underwritten capital increase against contribution in cash with subscription rights for existing shareholders of Vonovia. The share capital of Vonovia shall, be increased from 575.26 million euros by 201.34 million euros to 776.60 million euros through the issuance of 201.34 million new registered shares with a notional value of 1.00 euros and full dividend rights from 1 January 2021.

Vonovia noted that the new shares shall be offered to the shareholders of the company by way of an indirect subscription right at a ratio of 20:7 (that is 20 existing shares of the Company entitle their holder to subscribe for 7 new shares) and a subscription price of 40.00 euros, corresponding to a discount of 22.5% to the theoretical ex-rights price. On that basis, Vonovia expects to generate gross proceeds of 8 billion euros and intends to use net proceeds to partially repay amounts under the syndicated loan facilities agreement for the acquisition of Deutsche Wohnen SE.

The subscription period is expected to begin on 24 November 2021 and is scheduled to end on 7 December 2021.

Vonovia said last month it successfully completed its public takeover offer to the shareholders of Deutsche Wohnen SE. Vonovia secured a total of around 87.6 percent of the voting rights of Deutsche Wohnen.

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