Brookfield Asset Management Inc. has agreed to buy Hibernia REIT Plc in a deal valuing the Irish company at about 1.09 billion euros ($1.2 billion). Hibernia’s shares surged to a record.
Benedict Real Estate Bidco Ltd., a subsidiary of one of Brookfield’s real estate private funds, will pay 1.634 euros a share in cash, according to a statement. The price represents a 33.9 percent premium to Hibernia’s average share price over the past three months.
Brookfield has been on an acquisition spree across Europe as it bets on the future of the office and takes advantage of the discounts to asset value at which many of the continent’s landlords trade. The private equity firm is also in the process of buying Belgian office owner Befimmo SA and German landlord Alstria Office REIT-AG.
The offer price represents a 5.7 percent discount to Hibernia’s last reported asset value at the end of 2021.
“The acquisition recognises the company’s prospects and the quality of its portfolio of assets and delivers an acceleration of the value we expect to be created from completion of Hibernia REIT’s major office development projects,” Danny Kitchen, Chair of Hibernia REIT, said in the statement.
Hibernia owns and develops office properties in Dublin where technology companies including Google parent Alphabet Inc. and Facebook owner Meta Platforms Inc. have been expanding rapidly. The company’s portfolio, which also includes residential buildings, was valued at 1.45 billion euros at the end of September.
The coronavirus pandemic weighed heavily on publicly traded office landlords as investors contemplated the impact of a widespread switch to more flexible working. Brookfield has pounced on that uncertainty, investing in several European office landlords in a bet that demand will be sustained for the best city center office space even if increased home working dents values for older properties.
Hibernia’s board, who own about 1.37 percent of the company’s shares, have recommended the offer to shareholders. Brookfield’s offer is final and will not be increased, except in circumstances where another bid emerges, according to the statement.