A real estate deal between two Israelies in Germany brings one of them, Yakir Gabay, to list one of the biggest exits of an Israeli developer of all time.
German real estate firm TLG Immobilien AG, acquired a 9.99% stake in its rival AroundTown AG from Yakir Gabay (Avisco group), for about 1.02 billion euros ($1.14 billion). After this sale, Gabay’s stake in Aroundtown reduced to 17%. The sale will be priced at 8.3 euros per share.
The two companies started talks to merge the businesses. The merged company is supposed to be worth € 13 billion and enjoy € 1 billion in revenue a year. The company may enter the Caches index, which includes the 30 largest companies traded in Germany.
Yakir Gabay, the founder of AroundTown, listed the shares in 2015 in both Euronext Paris and the Frankfurt Stock Exchange, at a company value of 1.6 billion euros.
TLG is a public company operating in Germany’s commercial offices and centers, mainly in the cities of Berlin, Frankfurt, and Dresden. TLG, which currently has properties worth 4.6 billion euros said it is evaluating a potential merger. The move would immediately add to its funds from operations, according to the company.
Its major shareholder is Amir Dayan (29.3%), the youngest brother in the family who owns Africa Israel Hotels. The Singapore government holds 9.25%.
“Today’s announcement is the first step to enable the potential creation of a pan-European commercial real estate market leader, focused on Germany and the Netherlands and geared towards offices and hotel, which are the most attractive segments in commercial real estate,” Avisco said in a statement.
TLG said it intends to seek representation on Aroundtown’s board as soon as possible.