November 28, 2017 / 1:30 PM / in a year

Shareholder Petrus Advisers opposes CA Immo and Immofinanz merger

VIENNA, Nov 28 (Reuters) - CA Immo should terminate merger talks with rival Austrian property group Immofinanz, activist investor Petrus Advisers said in an open letter on Tuesday, calling the proposed tie-up a waste of money and time.

The Austrian firms agreed to merge in April 2016 to create one of the biggest real estate groups in central and eastern Europe, on condition that Immofinanz sold its Russia portfolio first, which took until this month.

Immofinanz, which owns 26 percent of CA Immo shares, said the companies would soon agree a schedule to resume merger talks.

Petrus Advisers said in its letter to CA Immo’s chairman of the supervisory board, Torsten Hollstein, that unless there was support from 75 percent of all shareholders “every effort for a merger would be an unacceptable waste of money and time.”

The London-based investor, which says it holds more than 2 in CA Immo and under 4 percent Immofinanz, said the companies should focus on increasing the value of their shares.

Petrus said it had calculated a potential rise of 40 percent in Immofinanz shares if it bought CA Immo instead of merging.

Immofinanz’s shares would also climb by a comparable amount if the company sold its CA Immo stake, the letter said.

CA Immo and Immofinanz declined to comment. (Reporting by Kirsti Knolle and Alexandra Schwarz-Goerlich; Editing by Edmund Blair)

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