Black Sea Global Properties is offering £40 million for AIM-quoted German retail property investor Deutsche Land.
Black Sea Global Properties is offering £40 million for AIM-quoted German retail property investor Deutsche Land.
Isle of Man-based Deutsche Land said today it had ‘no comment’ as yet on the cash offer at 12p a share from Black Sea Global, whose indirect parent was until recently linked to Romanian oil concern Rompetrol. The offer represents a nine per cent premium to loss-making Deutsche Land’s pre-bid price but is at a fraction of its 70p 2006 float price and follows a share issue in June by capital-hungry Deutsche Land to Black Sea and others, also at 12p.
This took Black Sea’s holding to 29.9 per cent, the maximum allowed under the City Takeover Code before triggering a mandatory bid for the whole company. According to Black Sea, Deutsche Land, which lost a first-half £41 million after £35million of write downs, wanted to raise another £20 million on the same terms, which would have taken Black Sea’s stake to some 54 per cent.
Black Sea says it was initially prepared to seek a ‘whitewash’ from the Takeover Panel and Deutsche Land shareholders relieving it of the obligation to make a full bid, but changed its mind after consulting Deutsche Land’s ‘largest independent shareholder’. So Black Sea has now taken its own holding up to 32.1 per cent and is bidding after all.
According to Black Sea – whose bid puts an ‘enterprise value’ of £422 million on Deutsche Land, including ‘approximately £382 million of net debt’ – the AIM company and its German property portfolio are ‘in need of financial restructuring’.
