RKS fund launches takeover bid for Socimi de Alquiler Seguro
First corporate move. Spanish real estate investment fund RKS, through its Socimi (real estate investment trust) Ktesios, has launched a takeover bid for rival Quid Pro Quo. RKS has offered €1.25 for each of QPQ's shares, when the latter was trading at €1.05 at yesterday's close. The purchase will be made at a 19% premium to the stock market price. The total amount of the transaction represents an investment of EUR 13.25 million.
What is Quid Pro Quo? This company specializes in buying homes that its shareholder Alquiler Seguro leases below market price and then keeps them on the market. The apartments are located in Madrid, Andalusia, the Basque Country, Catalonia, Valencia and Murcia. This Socimi is 23.5% owned by Alquiler Seguro, while the Swiss bank LGT Bank holds 7.89% and the IESE International Foundation 5.46%.
RKS has announced that its offer has been accepted by 92.43% of the shareholders, of which there is an irrevocable commitment from 55.63%, while 12.79% should sign within the next 48 hours. The acquiring fund is committed to pay 30% in cash in advance and the remaining 70% over the next 12 months, with an increase of 6%.
Who is Katesios and RKS?
Ktesios, a vehicle 78.84% owned by RKS, buys buildings in secondary locations at substantial discounts on market value and signs long-term leases with default insurance. In October of this year, this Socimi closed the acquisition of 223 properties in Toledo, Ciudad Real, Cádiz, Murcia, Albacete, Alicante and Cuenca, as reported by EL PERIÓDICO DE ESPAÑA. Ktesios' income in 2021 was 514,000 euros, although it reported a loss of 69,000 euros. Thanks to the expansion of its housing portfolio in recent years, the company has achieved
This company was incorporated in 2019 and has been listed on Euronext Access Paris since early 2021. This company is a twin of another, RKS Real Estate, founded in 2016 with the same investment strategy. Between the two vehicles, RKS Asset Management has more than 1,500 homes and €25 million of capital under management, which will now be expanded with the new acquisition.
Quid pro quo portfolio
The Socimi de Alquiler Seguro had 169 apartments, as the company announced last October after buying its last four properties. These properties are 92.8% rented, with an average contract duration of 2.3 years. This company is chaired by Gustavo Rossi, one of the founders of Alquiler Seguro together with Antonio Carroza. During the first half of this year, it achieved rental income of 535,000 euros and reported a profit of 223,000 euros.
Quid Pro Quo, in 2021, had a plan to expand its rental portfolio to 300 units, with a market value of 50 million euros and a gross profitability of around 7.5%. "We buy the rented apartment, we make the asset profitable from the same day we sign at the notary and there is no need to make investments in it because it is already rented. In addition, they have all the information related to the tenant, incidents in the property, rental period or photographs," explained the company's head of Property Management, Jesús Martí, in an interview with Brainsre.news.
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