A private equity consortium led by JC Flowers is poised to take a 24.9% stake in Hypo Real Estate, the German property finance group, showing that investors scent opportunity in the sector after concerns over sub-prime exposure and property values have driven down share prices. Financial Times, The Times
Hypo Real Estate 'in principle' welcomed the proposed €22.50-a-share offer, which had been discussed with its management board. HRE said its management and supervisory boards would comment on the proposed price after receiving an offer document.
HRE shares plunged in January when the lender, part of the Dax 30 index of leading German companies, revealed a sharp fall in annual profits and higherthan-expected exposure to the credit crisis. The group’s value has partially recovered but the shares are trading well below their 52-week high of more than €52.
The proposed offer price is 21.8% higher than the price at which shares in HRE closed on Tuesday.