Key Events During the Reporting Period
The acquisition of 2,340 apartments in the greater Stockholm and Gothenburg regions between Vonovia and Akelius Residential Property was completed on April 1, 2019. The value of the property assets acquired amounted to around € 451.9 million.
Vonovia implemented a capital increase involving 16,500,000 new shares on May 16, 2019. The new shares were placed with institutional investors in the scope of a private placement by means of an accelerated book building procedure and have carried dividend rights since January 1, 2019. The shares were granted at a placement price of € 45.10 per share. This increased the capital reserves by € 727.7 million.
The Annual General Meeting held on May 16, 2019, resolved to pay a dividend for the 2018 fiscal year in the amount of € 1.44 per share. During the subscription period, shareholders with a total of 45.8% of shares carrying dividend rights opted for the scrip dividend that had been offered as opposed to a cash dividend. As a result, 7,695,677 new shares were issued at a subscription price of € 44.352 and in a total amount of € 341.3 million.
As part of the public takeover offer made to the shareholders of Victoria Park AB (publ), Vonovia had agreed on call options for 10,235,198 class A shares and 14,264,946 class B shares, which corresponds to 10.0% of the total number of shares and 12.5% of the total voting rights in Victoria Park. These call options were exercised on May 20, 2019, meaning that Vonovia controls around 91.4% of the total number of shares and 94.4% of the total voting rights as of this date.
Vonovia then asked the Board of Directors of Victoria Park to initiate a squeeze-out for the purchase of all remaining shares in Victoria Park in line with the Swedish Companies Act. The Board of Directors also resolved to apply for delisting of the Victoria Park ordinary shares of class A and class B from Nasdaq Stockholm. The last day of trading was June 18, 2019.
The impairment test performed in the second quarter of 2019 revealed the need for goodwill impairments in the amount of € 1,901.0 million, largely due to the € 2,258.7 million increase in the value of the real estate portfolio as of the date of valuation (June 30, 2019). These were distributed among the business areas North, Southeast, West, Central and South in the Rental segment in Germany.
Due to the new regional structure, the two business areas Southeast and Central ceased operations as of the third quarter of 2019. Following the reallocation of the remaining goodwill of the Rental segment in Germany among the still operational business areas, this led to the need for further goodwill impairments in the amount of € 202.5 million.
On September 23, 2019, Vonovia SE announced that it had signed a contract for the purchase of 69.30% of voting rights and 61.19% of share capital in Hembla AB (publ), Stockholm, Sweden. As a result of the transaction, Vonovia became the owner of 6,136,989 Class A Hembla shares and 50,722,985 Class B Hembla shares. The parties have agreed to a purchase price of SEK 215.00 per share (irrespective of share class).
On November 5, 2019, Vonovia SE was given the green light from Sweden’s merger control authority for the acquisition of the shares in Hembla AB (publ). Once the acquisition of the majority of the shares was formalized, Vonovia published the mandatory offer for the remaining Hembla shares, which included a cash settlement for the shareholders of Hembla AB (publ) of SEK 215 per Class B share.
As of December 31, 2019, Vonovia held 6,136,989 Class A shares and 81,282,426 Class B shares in Hembla, representing approximately 95.3% of the voting rights and approximately 94.1% of the share capital. When the original acceptance deadline expired on December 9, 2019, it was extended once to January 8, 2020. As Vonovia held more than 90% of the shares following the expiry of the first and second acceptance deadlines, it asked the Board of Directors of Hembla to apply for delisting and initiate a squeeze-out in line with the Swedish Companies Act. The shares were delisted with effect from January 10, 2020.
On December 13, 2019, Vonovia received an A- rating from the largest European rating agency Scope Group for the first time, slightly better than the BBB+ rating assigned by Standard & Poor’s, which is also in the investment grade range.