Unibail-Rodamco-Westfield (URW) acquired a 38.9% stake in URW Germany GmbH and its related entities (URWG) from its joint venture partner Canada Pension Plan Investment Board (CPP Investments). The acquisition is an off-market transaction, in the context of an existing shareholders’ agreement and increases URW’s stake in URWG to 89.9%. Both partners retain the option to transfer the remaining 10.1% of CPP Investments’ interest to URW in 2025 for a cash consideration of up to €65m.
The acquisition involves issuing 3.254 million new URW stapled shares, about 2.2% of URW’s post-execution fully diluted share capital, as payment to CPP Investments for a 38.9% stake in URWG.
URWG owns five shopping centres in Germany: Minto (Mönchengladbach), Hofe am Bruhl (Leipzig), Palais Vest (Recklinghausen), a 50% stake in Paunsdorf Center (Leipzig), and a 20% stake in Gropius Passagen (Berlin). It also holds €416 million in cash, including €238 million from the recent sale of Pasing Arcaden (Munich).
The transaction is EPRA NTA neutral for URW, improves its pro forma IFRS LTV by approximately -20 bps, and enhances its cash position without affecting URW’s 2024 AREPS guidance.
This transaction does not affect other joint ventures and co-investments between CPP Investments and URW, including Westfield Stratford City, Westfield Centro and some assets in the US.
Pursuant to French legislation, the transaction appraisal documentation includes an opinion confirming the fair value of the exchange ratio.
Image source - Pexels.
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