TAG Immobilien AG refutes allegations made by 'Welt am Sonntag'

TAG Immobilien AG / Key word(s): Statement

08.10.2013 / 10:32


TAG Immobilien AG refutes allegations made by 'Welt am Sonntag'

Hamburg (8 October 2013) - TAG Immobilien AG ('TAG') refutes the allegations made against the company and its organs by Germany's 'Welt am Sonntag' in its 6 October 2013 edition, and hereby summarises the key facts that show these allegations - of business practices that are supposedly disadvantageous to TAG and contravene the principles of good corporate governance - to be baseless.

The claim that TAG paid too much for the 2011 acquisition of the portfolios in Chemnitz and Eberswalde does not take into account the specific conditions of the transactions, which were structured as share deals - involving the acquisition of shares in companies - and were partially paid for in shares.

The use of this structure allowed the company to reduce the cash component, minimise risk, and take over the attached financing. This would not have been possible with a direct purchase, and these advantages were priced in. The residential properties have since performed well, and the investments are profitable. Their market prices were judged by the company's independent surveyors to be higher than their purchase prices at the time of the purchase and even more so today.

The purchase of a tower block in Rostock, by a company in which Mr Elgeti holds a minority stake, is not related to these acquisitions in any way. A purchase of this asset would not have been possible for TAG for a number of reasons, not least because the deal size and the technical condition of the building were not compatible with TAG's acquisition criteria. Before its execution, the purchase had been cleared with the Head of the Supervisory Board.

The Supervisory Board was kept informed at all times of Mr Elgeti's various stakes in companies, some of which he had largely already held when he took over the CEO position. Mr Elgeti's contract stipulates that he is authorised to maintain these investments, provided that there are no conflicts of interest and no negative impact on his work as CEO of TAG.

Mr Elgeti currently owns 17 residential properties, of which he already held 16 before joining TAG. These were largely financed through loans. He owns stakes in 23 real estate owning entities mainly as minority shareholder and in some instances he is also a director of these. 14 of these existed prior to him joining TAG. They hold 77 assets of which 16 were purchased after his appointment as CEO of TAG.

TAG regrets that the facts provided to the 'Welt am Sonntag' in the course of its research were partly presented in a misleading way. However, TAG does not see a connection between this article which led to some pressure on its shares yesterday and intensified short selling in TAG shares last week as was speculated in the market yesterday.

The Management Board reiterates that Mr Elgeti's activities at no point constituted a conflict of interest, and that he will continue to work tirelessly for the good of TAG Immobilien.


Press enquiries:
TAG Immobilien AG
Head of Investor & Public Relations
Dominique Mann
Tel. +49 (0) 40 380 32 300
Fax +49 (0) 40 380 32 390

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Company:TAG Immobilien AG
Steckelhörn 5
20457 Hamburg
Phone:040 380 32 0
Fax:040 380 32 390
ISIN:DE0008303504, XS0954227210
WKN:830350, A1TNFU
Listed:Regulierter Markt in Frankfurt (Prime Standard), München; Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover, Stuttgart
End of NewsDGAP News-Service

233709  08.10.2013