Novavest and Senioresidenz: Board members vote in favor of merger
The negotiations have been pushed forward quickly, according to reports. The merger should result in savings this year.
On April 17, the Boards of Directors of Novavest Real Estate AG and Senioresidenz AG concluded a merger agreement for the merger of the two companies. This is according to a press release from Novavest. Shareholders must now approve the merger at the respective extraordinary general meetings.
The merger of the two companies will result in a real estate portfolio with a market value of CHF 1.02 billion. The current Chairman of the Board of Directors of Senioresidenz, Thomas Sojak, is to lead the Board of Directors of the merged company. Novavest and Senioresidenz informed about their plans for a merger for the first time in January. According to a statement, the negotiations were "driven forward quickly".
Cost synergy of just under 1 million
The merged real estate portfolio will have a combined residential share of 59%. Prior to the merger, Novavest's residential share was 63% of target rents. The Senioresidenz portfolio is mainly focused on age-appropriate and assisted living, senior residences and retirement/nursing homes; the residential share amounted to 48% at the end of the year. On a pro forma basis, the two companies together generated target rental income from investment properties of CHF 42.6 million and rental income of CHF 34.2 million. The gross yield amounts to 4.2% and the net yield to 3.5%. The pro-forma vacancy rate is 3.1%. "The scale of the real estate portfolio and the combined company achieved through the merger increases the attractiveness for investors and creates expanded growth and financing opportunities," says the Novavest press release. In addition, the merger of the two companies could exploit synergy potential. Sustainable cost synergies of around CHF 0.9 million were identified during the merger talks. These should be realized in the course of 2024 and be fully visible in the figures for the first time in 2025. The merger will also significantly reduce the risk profile in relation to the individual properties and the largest individual tenants.
As part of the merger, the creation of new shares is planned, with which the conversion of an existing mandatory convertible bond of Senioresidenz is to be achieved. (aw)
