(Bloomberg) -- Barry Sternlicht’s Starwood Capital Group, one of the world’s largest real estate investors, will formally open its buyout offer to shareholders of CA Immobilien Anlagen AG on Monday at a price that’s now 3.7% below the market level and facing a potential counter-bid.
Starwood announced in January an offer of 34.44 euros a share, a 12% premium at the time, that valued the Austrian commercial property group at 3.4 billion euros ($4.1 billion). The stock immediately went above that level and stayed there ever since, closing at 35.75 euros on Friday.
Further complicating the offer and possibly encouraging holders to wait for a better deal, a potential rival bidder entered the scene. Luxembourg-based investor Aggregate Holdings SA said last month that it “may be considering” a bid. It hasn’t come forward with one yet.
Starwood, which raised its initial 26% stake in CA Immo to 30% during 2020, still aims to take over all of the company, it said in a statement on Saturday. The offer isn’t contingent on reaching any thresholds.
With the move, Starwood is doubling down on its wager on CA Immo’s prime German office space and its big land bank in the capital Berlin and other German cities. The pandemic triggered a collapse in property stocks last spring, and the offer price is still 18% below CA Immo’s 2020 high of 41.85 euros.
Starwood first bought a 26% stake in CA Immo for 758 million euros, or 29.50 euros per share, in 2018, following a brief takeover tussle involving cross-town rivals Immofinanz AG and S Immo AG. It started to add shares in piecemeal transactions last April, coming within striking distance of the 30% trigger in the last week of the year.
The acceptance period for shares and convertible bonds begins on Monday and runs through April 9, said Starwood’s SOF-11 Klimt CAI Sarl vehicle, which will do the bidding. The offer document will be released on Starwood’s and CA Immo’s website. Completion is subject to merger control clearance.
CA Immo’s second-biggest shareholder is S Immo with a 6% stake, and it already said it won’t tender its stock. Another 6% is held as treasury shares.
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