Vonovia and Deutsche Wohnen announced the largest merger in Europe this year

German real estate companies, Vonovia and Deutsche Wohnen (DW), have announced a merger. The deal will amount to about € 19 billion, which will be the largest merger in Europe since the beginning of this year.

Vonovia offered Deutsche Wohnen shareholders at € 53.03 per share, which is 18% higher than the company’s quotes at the end of trading on Friday. After the announcement of the deal, DW shares jumped almost 16%, while Vonovia, on the other hand, dropped almost 6%.

The two largest residential landlords in the country control over 500,000 apartments. Over the past few years, German landowners have faced strong public pressure due to rising prices, especially in Berlin. Therefore, representatives of the companies intend to hold negotiations with the mayor’s office of the capital to discuss the current deal, as well as further cooperation with the city authorities. In particular, the merged company plans to offer the city about 20 thousand apartments, and the growth in housing prices will be limited by the terms of the agreement until 2026.

Kirill Sarkhanyants