Enter multiple symbols separated by commas

Hypo Real Estate Makes Bid for Depfa

German real-estate financing company Hypo Real Estate has agreed to take over Dublin-headquartered Depfa Bank in a shares-and-cash transaction that values Depfa at 5.7 billion euros ($7.9 billion), the companies said Monday.

Munich-based Hypo Real Estate said it would offer Depfa shareholders 6.80 euros ($9.38) per share in cash and 0.189 share from new shares to be issued by Hypo as part of the deal. That was the equivalent of 16.14 euros ($22.27) per share, described as a 17% premium over Depfa's closing price on Friday of 13.80 euros ($19.04) from Friday.

The companies said their boards had reached agreement on the deal.

Hypo Real Estate will issue some 67 million new shares to Depfa shareholders using an existing authorization, while paying them 2.4 billion euros ($3.3 billion) in cash. Depfa, which specializes in public-sector finance, would become a wholly owned subsidiary of Hypo but keep its name, headquarters and brand identity.

Hypo Real Estate, which provides large-volume commercial real-estate financing, said in a statement that the acquisition would "jointly create one of the world's leading and focused provider of financing solutions for commercial real estate, the public sector, and infrastructure projects.

The two companies would be able to combine their activities in the field of infrastructure financing and together attain "critical mass" in their investment banking and asset management businesses, the statement said.

The combined entity would have some 2,000 employees and a market capitalization 10 billion euros ($13.8 billion), Hypo Real Estate said.

The deal must be approved by the Irish High Court and by votes representing 75% of Depfa share capital, as well as by antitrust and banking regulatory agencies.

Contact U.S. News


    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Piper Hoppe, 10, from Minnetonka, Minnesota, holds a sign at the doorway of River Bluff Dental in Bloomington, Minnesota, on July 29, 2015, during a protest against Cecil's killing.

    The U.S. Fish and Wildlife Service has been trying to find the man who shot a lion in Zimbabwe, but he is not responding.

  • Donald Trump

    From one real estate mogul about another: Don't underestimate Republican presidential candidate Donald Trump.

  • Rifle sight

    Hackers were able to exploit a sniper rifle's vulnerabilities and change the gun's target, according to Wired.

U.S. Video