German real estate firm Adler Realestate acquires Israeli IDO Group for NIS 2.8 billion (€ 722 million). IDO Group trades in Israel and owns (38%) subsidiary DJ Properties operating in the Berlin rental market.
For the holders of the IDO Group – the Apollo Fund (32%) and the Dayan family (19.7%) – this is a huge exit, as the transaction is expected to be carried out at a value of about NIS 100 per share, which is about 83% higher than the company traded on the stock exchange. Shikun and Binui holders of ID Group also agreed to the deal.
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The transaction will be carried out using the triple inverse merger method. Following the transaction, IDO Group is expected to be eliminated from trading on the Tel Aviv Stock Exchange. IDO Properties is trading on the Frankfurt Stock Exchange worth 1.7 billion euros.
ADLER Real Estate AG is a publicly listed company. Its activities center on the acquisition and management of residential properties throughout Germany.
Adler is the controlling shareholder of Brack Capital (70%), which trades on the Tel Aviv Stock Exchange at NIS 2.6 billion (€ 663 million). Adler owns 58,000 apartments for rent in Lower Saxony and North Rhine-Westphalia, Germany. The company’s rental portfolio generates annual revenues of € 219 million. And its fair value is 5 billion euros.
IDO Properties owns a portfolio of 22,169 apartments for rent in Berlin and 1,458 commercial properties with a fair value of € 4.4 billion. The company lost 14% of its value from the beginning of the year, against the backdrop of a law that would freeze rent in Berlin as of January 2020. This will delay the realization potential of the company’s property in Berlin, which is due to the fact that the average monthly rent charged by the company is € 6.81 per sq.m. The monthly apartment renewable contracts in the company’s assets are € 10.11 per square meter.
IDO Properties reported this week that it had signed a non-binding memorandum of understanding for the sale of 5,800 apartments purchased by the company in 2015 for € 400 million. The fair value of the portfolio is estimated at € 800 million. The deal is expected to be announced concurrently with a new company strategy that will expand its operations outside Berlin.
Adler Real Estate, which trades on the German stock exchange worth 823 million euros, acquired in February 2018 control of Brack from Teddy Sagi and from the public, for NIS 2.2 billion.
By Yoram Gavison and Michael Rochwerger, The Marker
