Germany's biggest property firm Vonovia agrees €6.1bn BUWOG acquisition
Vonovia, Germany's largest residential property company, looks set to acquire Austrian real estate firm BUWOG for €6.1bn.
The two companies released a joint statement on Monday confirming a proposed merger that would create a property portfolio of nearly 400,000 across the two countries.
BUWOG's board of directors has a 'positive stance' in regards to the offer, with the company's shares quickly rising by 17.2% following the announcement.
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As a consequence of the agreement, Vonovia will be able to accelerate its construction plans in Germany, where in recent years a housing shortage has resulted in a sharp spike in a previously benign market.
"BUWOG is an excellent fit for our company: the housing stocks complement each other perfectly in Germany and Austria," said Vonovia's CEO Rolf Buch.
"With the merger, Austria would become a sustainable part of our apartment portfolio. We furthermore strengthen our business model with the successful Development business of BUWOG."
Though an Austrian company, over half of BUWOG's property is in the German hubs of Berlin and Hamburg.
Its CEO Daniel Riedl added: "A merger between BUWOG and Vonovia offers a strategic advantage for both companies.
"The value and the growth prospects of our attractive portfolio as well as our strong position in the development sector are adequately reflected in the current offer."
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