In September 2019, TLG acquired 9.99% stock of AroundTown from Yakir Gabay for over 1.02 billion euros. In a twist of events just 2 months thereafter, Aroundtown published a tender-offer to purchase TLG Immobilien AG stock, which if confirmed, will create a Pan European conglomerate leader in office, hotel and residential real estate management with over €28 billion assets.
Aroundtown is the largest publicly traded commercial real corporation in Germany and one of the largest companies in Europe. The main shareholders of Aroundtown are its’ founder Mr. Yakir Gabay, TLG, Blackrock, Norges Bank, Fidelity and various other international investors.
Grand City Properties, the fourth-largest residential company in Germany, is another Yakir Gabay success story. Over the past year, Grand City has quietly picked up hundreds apartments in London, part of a long term buying spree strategy that has so far yielded more than 2,000 apartments, and could potentially double over time.
The combination of AroundTown and TLG Immobilien should benefit from significant financial and operational synergies in the amount of over 100 million Euro within 5 years after merger, of which €64-80m (pre-tax) is driven by acceleration of financial saving of Aroundtown’s debt, by reaching an A- credit rating.
In addition to financial synergies, the merger can potentially lead to a Dax inclusion of the merged company. This will significantly increase the liquidity of Aroundtown stock (AT1) which is traded on the Frankfurt Stock Exchange, and potentially create large inflows of ETF funds into the stock.
TLG largest shareholder is Ouram Holding SARL, controlled by Mr Amir Dayan who privately purchased in December 2019 the BCR Palace in downtown Bucharest and reportedly acquired via Luxembourg-based Vivion Investments the 150-room Sanderson London and the 204-room St Martins Lane Hotel in London for a combined price of £255 million in January 2020.
Prior to the initial acceptance deadline, Aroundtown has already secured 53% ownership control of TLG as investor confidence is growing the merger will be accepted by all respective parties.