BERLIN (dpa-AFX) - German real estate company Vonovia SE (VONOY) announced the sale of a minority common equity participation in its 'Sudewo' portfolio to Apollo, on behalf of its affiliated and third party insurance clients and other long-term investors, for 1.0 billion euros.
The transaction values the Sudewo portfolio at 3.3 billion euros on a debt free and cash free basis, implying a discount below 5% to its fair value as of December 31, 2022.
Vonovia said it retains a long-term call-option to repurchase the participation at an IRR of 6.95%-8.30% (including dividends received) without an obligation to exercise the option.
Vonovia noted that it will continue to control, operate, and consolidate the portfolio, which comprises more than 21 thousand residential units in locations across the state of Baden-Württemberg.
Closing of the transaction is expected to occur around May 31, 2023.
Vonovia intends to use the proceeds for liability management and to cover upcoming debt maturities.
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