Plan for Adler Real Estate: Adler delists its German subsidiary from the stock exchange

Status: 06/24/2022 10:07 a.m

The real estate group Adler Group wants to completely take over its crisis-ridden German subsidiary Adler Real Estate, squeeze out the other shareholders and then take them off the stock exchange.

The real estate company Adler Real Estate, which is in legal turbulence, is to be taken off the stock exchange. For this purpose, the Luxembourg parent company Adler Group, which has a 96.7 percent stake in Adler Real Estate, has applied for a so-called squeeze-out procedure, in which all other shareholders will be compensated, both companies announced yesterday evening.

A squeeze-out is a procedure under stock corporation law. The majority shareholder of a company, who must hold at least 95 percent of the shares, forces the remaining minority shareholders to give him their shares in return for cash compensation. According to calculations by the Reuters news agency, these would cost almost 19 million euros at yesterday’s closing price.

To justify this procedure, the management of the Adler Group stated that the complete takeover was an important milestone in the ongoing integration process. In addition, the group structure should be simplified.

BaFin examines the balance sheets

Only on Wednesday the financial regulator BaFin extended its audit of Adler Real Estate’s balance sheets to 2021. Previously, the auditors of KPMG had not wanted to confirm the accuracy of the accounts of the Adler Group and its German subsidiary from 2021.

BaFin therefore has indications that “relationships and business transactions with related persons or companies” in the Berlin company’s balance sheet “may not have been fully and correctly recorded and represented”.

The financial supervisory authority can only examine the balance sheets of companies based in Germany that are listed on the stock exchange. In the case of the Adler Group, that would be the task of the Luxembourg supervisory authority. The Adler subsidiary Consus had already announced its withdrawal from the stock exchange on Tuesday.

“No systematic fraud”

The turbulence at Adler Real Estate was triggered by allegations by the company Viceroy of short seller Fraser Perring that there were deficiencies in the valuation of real estate at Adler. Some of these were artificially inflated.

The auditors of KPMG Forensic had investigated the allegations and stated that they had not found any systematic fraud, but had found deficits and complained about the lack of important information. Fraser Perring became known through his early allegations against the now insolvent financial service provider Wirecard.

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