Deutsche Wohnen AG.» Public share exchange offer for GSW Immobilien AG. Presentation August 2013

Transcription

1 Deutsche Wohnen AG» Public share exchange offer for GSW Immobilien AG Presentation August

2 » Compelling transaction rationale Strategically and financially attractive transaction with conservative balance sheet structure Focussed Further enhancement of Core + -approach of Deutsche Wohnen in order to profit rent upside potential "Enlarged Deutsche Wohnen" remains truly focussed and concentrated: no scattered holdings across Germany Efficient Deutsche Wohnen positioned to maintain cost leadership through expected realisation of synergies and further exploitation of economies of scale with combined platform Creating long-term sustainable FFO and NAV growth opportunities of combined Deutsche Wohnen and GSW Immobilien AG ( GSW ) Investible Achieving an enhanced capital markets profile with expected higher stock liquidity More flexibility and potential diversity on financing instruments 2

3 » Focus on Core + regions as competitive advantage 79% of the total portfolio located in Core + regions 72% of the total portfolio located in Berlin as highly attractive growth region Residential units 30/06/2013 Deutsche Wohnen GSW Combined Non-Core 4% Core 17% Core + 79% Other Core + 7% Berlin (incl. Greater Berlin) 72% Spandau 1,212 13,919 15,131 Reinickendorf 2,573 9,634 12,207 Steglitz-Zehlendorf 5,661 5,725 11,386 Neukölln 8,206 2,498 10,704 Marzahn-Hellersdorf 8, ,670 Charlottenburg-Wilmersdorf 3,315 4,747 8,062 Pankow 3,996 4,818 8,814 Friedrichshain-Kreuzberg 94 7,892 7,986 Lichtenberg 4,653 3,068 7,721 Total portfolio of c.150,000 units thereof c. 108,000 units in Berlin (incl. Greater Berlin) Treptow-Köpenick 2,657 1,612 4,269 Tempelhof-Schöneberg 2,902 3,194 6,096 Mitte 817 3,012 3,829 Greater Berlin 3,273-3,273 Berlin (incl. Greater Berlin) 48,029 60, ,148 Source: Company information as of 30 June 2013 for Deutsche Wohnen and GSW, adjusted for GSW acquisition of 2,827 units in Berlin and disposal of 470 units outside Berlin after reporting date Source: Company information as of 30 June 2013 for Deutsche Wohnen and GSW, adjusted for GSW acquisition of 2,827 units in Berlin and disposal of 470 units outside Berlin after reporting date Focus on Core + regions to participate in expected dynamic market development 72% of total portfolio is located in Berlin (incl. Greater Berlin), one of the most attractive and dynamic residential market in Germany Diversified and sizeable portfolio within a number of districts of Berlin allows for significant potential for rent increases Rent index with annual growth of 2.7% from 2005 to 2013E Additional significant growth potential from re-letting Critical size allowing efficient management, bundling of services (e.g. maintenance) and opportunistic disposals 3

4 » Berlin as one of the most attractive growth markets in Germany On-going strong demand for residential space in Berlin with low construction activity 1,881, ,884,280 1,887, ,890, ,894, ,898,807 1,903, Economic development translating into above average rental growth in the Berlin market in recent years Growth 5 years (%) Growth projected yoy (%) Berlin Housing stock Vacancy rate (%) Hamburg Source: Jones Lang LaSalle, Residential property market Berlin- 2 nd half of 2012, BBU Verband Berlin-Brandenburgischer Wohnungsunternehmen A further increase of Berlin's population is anticipated (m) ( /sqm/month) Munich Frankfurt Düsseldorf Cologne Past development Upper alternative Medium alternative Lower alternative Berlin top 25 cities average Source: DIW Economic Bulletin Report 2012 Top 25 cities average Source: Senatsverwaltung für Stadtentwicklung und Umwelt in cooperation with the Amt für Statistik Berlin-Brandenburg, Bevölkerungsprognose für Berlin und die Bezirke

5 » Efficiency through concentration and economies of scale Attractive cost synergies backed by strong integration track record 30.0% 45.0 Phase I: Integration and Restructuring after GEHAG acquisition at the end of % 20.0% 15.0% 10.0% 5.0% 24.3% 16.7% 13.0% Deutsche Wohnen reduced administrative costs from EUR 45m to EUR 32m or by 29% within 24 months Declining cost ratio 1 from 24% to 18% Phase II: Economies of scale through accretive acquisitions Acquisition of BauBeCon with ~ 23,000 residential units and of two portfolios each with ~ 5,000 residential units in 2012 Management expects cost ratio of c. 5-6% after integration Acquisition of 6,800 units in 2013 in Berlin with expected cost ratio of appr. 3% after integration 0.0% FC 2013 Total cost savings EURm Cost ratio(%) Cost leadership with combined cost ratio of Deutsche Wohnen of 13% expected in 2013 Combination of Deutsche Wohnen and GSW Expected enhancement of FFO profile for combined company of c. EUR 25m p.a. after full integration (expected to be reached in full c. 24 months after closing of the transaction) Combination allows to enhance both organisation structures and to be more efficient compared to a standalone basis cost structure operational performance purchasing Additional enhancements e.g. financing opportunities or opportunistic disposals Expected "one-off" integration costs of c. EUR 25m (depending on contractual conditions) and EUR 20m of other transaction costs 1) Cost ratio = total corporate expenses (total staff and G&A expenses) in relation to current gross rental income 5

6 » Significant value accretion for both shareholder groups EPRA NAV EURm Considerable NAV accretion potential 5,000 4,000 3,000 2,000 1, ,160 1,517 ~430 Deutsche Wohnen GSW Capitalised synergies Sources: Company information per H for Deutsche Wohnen and GSW Both Deutsche Wohnen and GSW shareholders to participate in synergy potential Net present value of synergies estimated at c. EUR 430m Capitalised with the average of the Deutsche Wohnen / GSW FFO yield on EPRA NAV of c. 5%, discounted for 2 years and including run-up of synergies Deduction of EUR 45m for expected one off transaction and integration costs Value enhancing transaction when considering NPV of synergies Capturing further value potentials from expected attractive rental growth and price development in the Berlin residential market FFO w/o disposals forecast 2013 EURm FFO benefiting from sizeable synergy potential Deutsche Wohnen GSW Synergies Source: FFO forecast 2013 and Deutsche Wohnen synergy estimate upon full integration Sizeable FFO accretion based on FFO guidance for 2013 of both companies and capitalised synergies Combined FFO without disposals after full integration of c. EUR 210m (implementation expected to take c. 24 month) FFO per share (excl. disposals) expected to increase from EUR 0.65 to > EUR ) Mid-point of current FFO 2013 guidance of EUR 73-78m 2) Upon full integration (expected to be reached in full c. 24 month after closing of the transaction 3) Based on exchange ratio of

7 » Improved capital markets visibility of combined Deutsche Wohnen / GSW Approaching Europe's "top 5" by market cap and free-float Creating most liquid stock by trading volumes in current German real estate 1 (EUR bn) c. EUR 17.6bn Unibail-Rod. Land Securities British Land Klépierre Europe "top 5" by market cap Free-float Gecina Dt. Annington Deutsche Wohnen/ GSW c. EUR 4.0bn Deutsche Wohnen LEG Germany Share of key investors Gagfah GSW Estimated average trading volume LTM (EUR m) Deutsche Wohnen/ 2 GSW estimated Deutsche Wohnen GSW 3 LEG Alternative Handelsplattformen trading plattforms 4 Haupthandelsplattform Main trading plattforma Durchschnittliches Average trading Handelsvolumen in % of free floata in % des Streubesitzes TAG Gagfah conwert Average trading volume in % of free float Pro-forma combined market cap of c. EUR 4.0bn positions Deutsche Wohnen/GSW among the leading companies in Europe with regards to free float market cap Liquidity of shares as a value driver Size allows for diversification and optimisation of financing sources Sources: Bloomberg, Factset, Lionshares, 16 August 2013 Note: 1) Deutsche Annington not included due to recent IPO 2) Estimate based on shares of individual trade volumes of Deutsche Wohnen and GSW 3) LEG: First trading on 1 February 2013, last 3 months used as reference 4) Xetra for companies mainly traded in Germany or Vienna stock exchange for Austria 7

8 » Conservative financing structure of the combined entity with further potential in the course of financing activities Pro-forma maturity profile of combined Deutsche Wohnen / GSW (EUR m) No significant maturities in 2014/2015 Solid combined financing footprint of combined Deutsche Wohnen / GSW 4.6% 1.7% 7.1% 10.0% 16.0% 12.5% 21.1% 27.0% > 2020 (EUR m) Deutsche Wohnen Pro Forma Net debt 2,964 1,790 4,754 LTV 55.8% 53.8% 55.0% Weighted average maturity (years) Weighted average interest rate 2 3.5% 3.6% 3.5% Weighted average amortisation p.a % 1.6% 1.7% Interest security (fixed/hedged) % ~100% ~90% Nominal debt 3,171 2,067 5,238 LTV (nominal) 57.7% 57.4% 57.6% Source: Company information as of 30 June 2013 for Deutsche Wohnen and GSW Deutsche Wohnen GSW Convertible Bond GSW Deutsche Wohnen: Long-term refinancing took place at the beginning of July 2013 Source: Company information as of 30 June 2013 for Deutsche Wohnen and GSW Both companies are long-term financed with combined LTV of 55% based on a sustainable valuation Additional opportunities from refinancings to enhance the FFO profile through a decrease of the total interest level of the combined company GSW providing additional loan diversification with additional financing banks 1 GSW metrics as per 31 March 2013 as not reported in H report 2 GSW interest rate as of 31 December

9 » Overview of the transaction structure Offer to GSW shareholders Offer of 51 Deutsche Wohnen shares for 20 GSW shares All-share offer, subject to EGM approval; allows all shareholders to participate in realisation of synergy potential Acceptance threshold of 75% Offer represents a 14.7 % premium to pre-announcement share price of EUR and a 15.4 % premium to the 3 months VWAP of EUR on the basis of the Deutsche Wohnen pre-announcement share price and 3M VWAP, respectively The newly issued shares of Deutsche Wohnen are entitled to a dividend as of 2014 Timing Deutsche Wohnen EGM 30 September 2013 Start of offer period Beginning / mid October 2013 Expected closing H Advisers Deutsche Bank and UBS 9

10 » Disclaimer This presentation is furnished solely for your information, should not be treated as giving investment advice and may not be printed, downloaded or otherwise copied or distributed. Neither the Company nor any of its directors, officers, employees and advisors nor any other person shall have any liability whatsoever for any direct or indirect losses arising from any use of this presentation. While the Company has taken all reasonable care to ensure that the facts stated in this presentation are accurate and that the opinions contained in it are fair and reasonable, this presentation is selective in nature. Any opinions expressed in this presentation are subject to change without notice and neither the Company nor any other person is under any obligation to update or keep current the information contained in this presentation. In addition, institutions mentioned in this presentation, their affiliates, agents, directors, partners and employees, may purchase and/or sell, as principals or agents, any shares that are offered or may act as market makers or provide investment banking or other services to the Company. Persons who intend to purchase shares in the proposed exchange offer are advised to base any decision about such an instrument, on the information contained in the offer document to be prepared by the Company, which may be different from the information contained in this presentation. This presentation contains forward-looking statements, which involve risks, uncertainties and assumptions that could cause actual debt levels, results, performance or events to differ materially from those described in, or expressed or implied by, such statements. These statements reflect the Company s current knowledge and its current expectations and projections about future events. No obligation is assumed to update any such statement. This presentation constitutes neither an offer to sell nor a solicitation to buy securities of the Company. The exchange offer is being made solely by means of, and on the basis of, the published offer document (including any amendments thereto, if any). An investment decision regarding the publicly offered securities of the Company should only be made on the basis of the offer document. The offer document will be available free of charge from Deutsche Wohnen AG, Pfaffenwiese 300, Frankfurt am Main or on the Deutsche Wohnen AG website This presentation does not contain or constitute an offer of, or the solicitation of an offer to buy or subscribe for, securities to any person or in any jurisdiction to whom or in which such offer or solicitation is unlawful. The information contained in this presentation is not for publication, release or distribution in Australia, Canada or Japan and, subject to certain exceptions, the securities referred to herein may not be offered or sold in Australia, Canada or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada or Japan. The securities referred to herein may not be offered or sold in the United States of America or to U.S. persons absent registration under the U.S. Securities Act of 1933, as amended (the Securities Act ) or another exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. The offer and sale of the securities referred to herein has not been and will not be registered under the Securities Act. There will be no public offer of the securities in the United States of America or any jurisdiction. The offer will only be made upon and after approval of the offer document by the BaFin and participation in accordance with the applicable legal requirements, in particular the German Takeover act. This presentation is directed at and/or for distribution in the United Kingdom only to (i) persons who have professional experience in matters relating to investments falling within article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the Order ) or (ii) high net worth entities falling within article 49(2)(a) to (d) of the Order (all such persons are referred to herein as Relevant Persons ). This presentation is directed only at Relevant Persons. Any person who is not a Relevant Person should not act or rely on this presentation or any of its contents. The offer will only be made upon and after approval of the offer document by the BaFin and publication in accordance with the applicable legal requirements, in particular the German takeover act. Any investment or investment activity to which this presentation relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. 10

11 Deutsche Wohnen AG Registered Office Pfaffenwiese Frankfurt am Main Berlin Office Mecklenburgische Straße Berlin Telefon: Telefax: Deutsche Wohnen AG 11