Vonovia €1bn Capital Increase by Share Sale, Germany

“The STJ team has given Vonovia very valuable and specialist equity capital markets’ advice over many years. STJ made a significant contribution to the success of our accelerated capital raising.”
Head of Finance & Treasury, Vonovia

3 May 2018

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STJ Advisors acted as independent equity capital markets advisor to Vonovia SE, Europe's largest residential real estate company and DAX constituent, on its €996m capital increase. This very successful equity offering is the largest real estate Accelerated Bookbuild transaction ever completed in Europe.

STJ advised Vonovia on all key aspects of the offering and has been ongoing equity capital markets advisor to Vonovia for its capital raising ambitions as it has grown since its IPO in 2013 (where we also advised).

"The STJ team has given Vonovia very valuable and specialist equity capital markets' advice over many years," Olaf Weber, Head of Finance and Treasury said. "STJ made a significant contribution to the success of our accelerated capital raising."

The offering of new shares representing 5% of Vonovia's share capital was conducted in an Accelerated Bookbuilding post-market close to part finance the company's further international expansion and particularly, the proposed €1.7bn acquisition of Victoria Park AB (Sweden's leading player in residential real estate) announced with Vonovia’s Q1 results in the morning.

Launched on the back of a c. 70% covered shadow book after a very limited wall-crossing exercise with existing shareholders and a small number of supportive investors, the offering was oversubscribed within 30 minutes against a weak market backdrop and a number of competing sizeable transactions. The final book was 2.8x oversubscribed with a balanced group of over 100 long-only and hedge fund investors (this compared very favourably to other transactions completed that evening). The pricing of €38.30 represented a very tight 3% discount to close (adjusted for the new shares as ex-dividend). Final allocations were skewed towards long-only and specialist real-estate investors with both existing and new shareholders represented. The stock opened above issue price against a relatively weak market backdrop, suggesting that the final outcome achieved the right balance, optimising valuation for existing and new shareholders.

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