The New Testa Prepares For Its IPO In Q2 2018

18 September 2017 – Cinco Días

On Thursday, the General Shareholders’ Meeting of Testa Residencial approved the non-monetary capital increase for its integration with Acciona’s rental housing business, in an operation worth €341 million.

In this way, a real estate giant of the highest calibre has been born. Testa Residencial, the rental home Socimi in which Santander, BBVA and now Acciona all hold a stake, is considering debuting on the stock market in the second quarter of 2018, between April and May, according to comments from market sources on Thursday (…). The company will thus debut on the stock market after becoming the largest rental home company in the country.

On the basis of the operation that was approved by the General Shareholders’ Meeting on Thursday, the group chaired by José Manuel Entrecanales will enter Testa’s share capital with a stake of 21%, which will turn it into the Socimi’s second-largest shareholder after Santander (36%), in exchange for it transferring 1,000 homes to the company.

The assembly also approved the entry of Acciona onto the Socimi’s Board of Directors, where it will be represented by Isabel Antúnez, the Director General of the Real Estate Development area at the construction and renewable energy group. Testa’s shareholders also gave the green light to the appointment of Javier Alarcó Canoso as an independent director, according to sources at the company.

The operation forms part of the growth strategy that Testa established following its constitution in October 2016, after the merger of Merlin and Metrovacesa. The ultimate goal of this “roadmap” is the debut of the firm on the stock market, as required by its status as a Socimi.

By virtue of the legal framework governing Socimis, the firm has until 30 September 2018 to debut on the stock market, and so the company plans to start working on its IPO at the beginning of next year, with the plan to be ready by the second quarter of the year.

In terms of the growth strategy, the integration of Acciona’s rental business constitutes the second major operation that Testa has completed in its first year of life. The first took place at the beginning of this year when its shareholder banks transferred it a package of 3,300 homes.

Now, once the operation with Acciona has been completed, Testa Residencial will have a stock of 9,041 homes to rent to individuals, spread over 118 buildings and worth around €1,816 million.

The company will generate revenues of around €70 million per year from renting out its portfolio of homes, more than half of which (51%) are located in the Comunidad de Madrid. The operation will thus give rise to a new, unprecedented real estate giant in Spain, as it will constitute the largest rental home company in the country (…).

Original story: Cinco Días

Translation: Carmel Drake