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ADIA exits Deutsche Annington for €750m

The Abu Dhabi sovereign wealth fund has sold its remaining 23.5 million shares in the German private home owner for €750 million.

The Abu Dhabi Investment Authority (ADIA), the Abu Dhabi sovereign wealth fund, sold of its remaining 6.6 percent stake in Germany’s largest private home owner Deutsche Annington for €750 million yesterday.

As of March 30, 2015, ADIA was the largest shareholder in Deutsche Annington with a 9.49 percent stake, but ADIA has been selling down its shares in the company over the last few weeks and has now fully exited, according to Michael Tegeder, senior investor relations manager at Deutsche Annington.

The price range for Deutsche Annington of between €30.80 and €31.79, matches the company’s price range on the Frankfurt share market yesterday.

Back in May 2014, ADIA’s position within Deutsche Annington was revealed as 13.4 percent after the sovereign wealth fund was required to make the disclosure under Germany’s financial market rules after Deutsche Annington proposed to alter its investment structure.

The German public property company was at the centre of an innovative exit strategy last year when London-based private equity firm Terra Firma, offered investors the chance not to cash out their investment but to be paid out in shares in the company instead.

At the time, sources suggested that limited partners were happy with the arrangement which had also piqued the interest of the fund management community because normally distributing ‘in specie’ – meaning the company could be handed off to investors in its share form rather than selling it and handing over the cash proceeds – is limited at least during the life of the fund to distributing liquid securities.

One European investor said: “Most of [the investors] can’t hold listed shares since these are part of a different allocation. As a consequence most start selling and prices drop due to the high supply of the private equity holders who like to sell,” he added.