Favorable price level: Aroundtown starts share buyback for up to EUR 500 million – share benefits | message

—By the end of the year, up to 120 million shares with a maximum volume of EUR 500 million can be bought on the stock exchange, as the real estate company announced. The buyback will start on Wednesday and will continue until the end of the year. The group wants to collect a maximum of 8.9 percent of the voting rights.

Aroundtown said that they were making use of the favorable price level. The company, which recently merged with TLG Immobilien, has sold properties for 400 million euros that are either not part of the horseradish business or whose potential has already been leveraged. For 220 million euros, sales have already been concluded, it said.

The share buyback comes in lieu of a dividend payment that Aroundtown initially canceled about two weeks ago given the uncertain economic outlook due to the coronavirus pandemic. At the end of May it was said that a buyback program was being prepared instead.

Investors celebrate Aroundtown share buybacks

The joy of upcoming share buybacks has catapulted Aroundtown shares to their highest level since mid-March on Tuesday. The papers of the specialist for commercial real estate attracted attention in the already much sought-after sector via XETRA with a price gain of more than 12.67 percent to 5.57 euros.

Since the low of the four-week Corona crash in mid-March at EUR 2,884, they have recovered by 92 percent. Up to the record high of 8.882 euros in February, some things are still missing.

The Luxembourgers announced in the morning that they would buy back their own shares for half a billion euros from this Wednesday until the end of the year – and thus up to 8.9 percent of all voting shares.

Analyst Thomas Rothaeusler from the investment bank Jefferies praised this step as enormously value-enhancing in view of the low stock valuation with a massive discount compared to the net asset value of 44 percent.

At the same time Aroundtown also announced who will run the company after taking over the competitor TLG. Rothäusler spoke of a strong management team.

FRANKFURT (Dow Jones) / FRANKFURT (dpa-AFX)