Gagfah takeover offer may cause change of control for 1.5% convertibles

By Jennifer Chiou

New York, Dec. 19 – Gagfah SA gave notice to holders of its 1.5% convertible bonds due May 20, 2019 that their bonds may be affected by a change of control due to Deutsche Annington Immobilien SE’s announced takeover offer to Gagfah shareholders.

According to a release from EQS Group AG, Deutsche Annington Immobilien published a voluntary public offer to acquire all registered Gagfah shares for €122.52 in cash and an additional consideration of five no-par value registered shares of the bidder for each 14 no-par value Gagfah shares tendered.

The takeover offer will run until Jan. 21. There is a minimum acceptance threshold of 57%.

The release stated that an additional acceptance period is expected to begin on Jan. 27 and end on Feb. 10.

If a change of control occurs under the terms of the bonds due to the takeover, holders may either demand the early redemption of their convertibles or exercise their conversion rights on the basis of the adjusted conversion price, Gagfah said.

Holders who wish to put back their bonds have to give notice no less than 10 calendar days prior to the effective date.

Any surrendered bonds will be redeemed at pat plus accrued interest.

Those who wish to convert their bonds must do so no later than 10 a.m. ET on Jan. 21.

The principal conversion agent is Citibank, NA.

Gagfah said it does not intend to exercise the cash alternative election set forth in the terms and conditions of the bonds.

Luxembourg-based Gagfah is an owner and operator of residential real estate in Germany.

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