Bulletin: German Residential Property Company Deutsche Annington Ratings Not Affected By Equity Funded Acquisition Of SÜDEWO Group

PARIS (Standard&Poor's) June 15, 2015--Standard&Poor's Ratings Services said today that its ratings on German residential property company Deutsche Annington (DAI; BBB+/Stable/A-2) are not affected by DAI's announcement that it has agreed to acquire peer SÜDEWO Group for €1.9 billion and plans to issue €2.2 billion of rights. We believe that SÜDEWO Group's assets, consisting of 19,791 units located in Baden-Württemberg (Southern Germany), with low vacancy rates (2.4% versus 3.4% for DAI), are well aligned with DAI's overall asset profile. In our view, the integration of the €1.9 billion target portfolio should strengthen DAI's presence in cities like Stuttgart, Ulm, and Mannheim, which enjoy healthy economic and demographic trends and are likely to support stable rental rates

...PARIS (Standard & Poor's) June 15, 2015--Standard & Poor's Ratings Services said today that its ratings on German residential property company Deutsche Annington (DAI; ###+/Stable/A-2) are not affected by DAI's announcement that it has agreed to acquire peer S_DEWO Group for 1.9 billion and plans to issue 2.2 billion of rights. We believe that S_DEWO Group's assets, consisting of 19,791 units located in Baden-Wnrttemberg (Southern Germany), with low vacancy rates (2.4% versus 3.4% for DAI), are well aligned with DAI's overall asset profile. In our view, the integration of the 1.9 billion target portfolio should strengthen DAI's presence in cities like Stuttgart, Ulm, and Mannheim, which enjoy healthy economic and demographic trends and are likely to support stable rental rates over the long term. Still, the impact remains relatively moderate, given the small size of the portfolio, which will represent about 8.5% of the combined portfolio's market value. We understand that DAI plans to raise...

Bulletin