The surprise resignation of Immoeast and Immofinanz chief executive Karl Petrokovics has paved the way for a merger between the two Austrian listed companies.
His replacement, Thomas Kleibl, said this week that shareholders could vote on a plan to combine the firms early next year.
A merger would give the companies “the size and the cash resources to invest in big projects”, said Kleibl, and help the Vienna-based companies to weather the turmoil in the financial markets.
The appointment of Kleibl, formerly chief financial officer of Austrian Airlines Group, marks the start of a new phase for Immoeast and Immofinanz, which lost more than 85% of their combined market value in the past six months.
A merger would reverse a spin-off of Immoeast from Immofinanz, which was set up in 1990. Immoeast was created eight years later to manage the developer’s central and eastern European assets. Immofinanz owns 54% of Immoeast and together they have about €15bn of assets.
Immofinanz owns offices, hotel and homes in Austria, Germany, Italy and Switzerland. Most of Immoeast’s assets are in Poland, the Czech Republic, Slovakia, Hungary and Romania.
Earlier this month, Immoeast halved its €4.2bn development pipeline to around €2bn on projects in CEE, especially Romania, where it has 20 projects.
Immoeast posted a pretax loss for the three months ended 31 July of €77m ($110.6m) compared with a profit of €114.2m a year earlier.
