Minority shareholders in Immoeast, the Austrian property developer that plans to merge with majority owner Immofinanz, will be offered control of the enlarged company in return for backing the transaction.

'There has to be a compelling commercial argument for the Immoeast shareholders to make sure they raise their hands when they have to vote on the merger,' Eduard Zehetner, chief executive officer of both businesses, said in an interview. 'The tricky part is how sweet to make the cake.'

Immofinanz’s biggest asset is its 55% stake in Immoeast, whose market value is almost three times bigger. Without that, Immofinanz’s debt exceeds its assets by about 800 million euros ($1.2bn), Zehetner said Sept 16 in Amsterdam. That would have to be reflected in the terms of any merger presented to investors, he said.