Fonciere Des Regions, France's fourth- biggest real estate investment trust, made an all-share bid for Beni Stabili SpA that values Italy's second-largest real-estate company at about 2.6 billion euros ($3.4 billion).
Fonciere, based in Metz, agreed to buy 35 percent of Beni Stabili from Leonardo Del Vecchio, founder of Italian eyeglass maker Luxottica SpA, the companies said today in separate statements. Fonciere offered one new share for every 100 Beni Stabili shares, less a special dividend of 7.50 euros a share. That values each Beni Stabili share at 1.531 euros, 12 percent more than the closing price on Feb. 16.
``It's a good price,'' said Tim Leckie, an analyst at JPMorgan Chase & Co. in London who recommends investors are ``overweight'' in Beni Stabili. ``The shares have already gained 13 percent this year, that's not bad for two months.''
Italy plans to introduce real estate investment trusts this year with a similar tax-free structure to France, making takeovers involving companies in the two countries easier. The enlarged group will have 14 billion euros of assets, including 4 billion euros in Italy where Fonciere currently has no assets.
Del Vecchio, Fonciere Chairman Charles Ruggieri and General Electric Co.'s real estate unit will own as much as 46 percent of Fonciere after the offer. They will ask the French regulator for an exemption from rules requiring them to bid for the company.
Share Performance
Beni Stabili's shares have jumped 52 percent in the past year. Fonciere's have gained by 47 percent to value the French company at 4.6 billion euros. The Bloomberg Europe Real Estate Index has advanced 53 percent over the same period. Both companies' shares were suspended from trading today on the Paris and Milan stock exchanges.
Fonciere will own about 40 percent of Beni Stabili once it buys Del Vecchio's stake, it said. It doesn't plan to buy all the outstanding shares, although it is obliged by Italian law to offer to buy them, the company said in an e-mailed statement. The offer will be made in July.
Fonciere des Regions wants to retain a maximum stake of 51 percent in Beni Stabili, JPMorgan said in a note to clients today, after speaking to the company.
If it owns more than 90 percent of Beni Stabili by the time the offer closes, ``Fonciere des Regions shall reinstate a free float sufficient to grant a regular market trading of the shares,'' the French company said in the statement. It didn't say what proportion of Beni Stabili's shares would continue to trade.
The offer price assumes Beni Stabili paying a dividend of as much as 2.4 cents a share and Fonciere paying dividends of as much as 12.20 euros a share, including a special dividend of 7.50 euros a share, before the takeover.
That values the offer at a 10.5 percent premium to Beni Stabili's closing share price of 1.367 euros, JPMorgan said.
Del Vecchio will be the biggest shareholder in the combined company, said Delfin Sarl, the Luxottica founder's investment vehicle, in a separate statement distributed today by the Italian stock exchange.
source:www.bloomberg.com
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