Metrovacesa officials say the firm was paying euro 1.64 billion ($2.2 billion) for 30% of Gecina from insurers Assurances Generales de France SA and Azur-GMF. The acquisition of France's leading property company will give Metrovacesa a foothold in key French business areas including the office rental market in Paris, where Gecina has a number of high-quality assets. It will also increase Metrovacesa's exposure in rental operations, which will now represent 80% of its total business, and reduce exposure in residential operations, which analysts are forecasting to cool down in Spain this year.

The offer represents a premium of 11% over Gecina's share price at Monday's close. Metrovacesa chairman Joaquin Rivero says Gecina shares won't be delisted and that Metrovacesa management would be comfortable with a free-float of about 40% for Gecina. He says he wasn't certain that all of Gecina shareholders would tender their shares and added that Metrovacesa could possibly float part of the French company at a later date.

The move comes after Rivero revealed this month that the company was planning to make a significant purchase in France, Belgium or the Netherlands, taking advantage of tax incentives for real estate companies with rental businesses. Rivero added that Metrovacesa will continue to keep an eye on further acquisitions abroad.

Morgan Stanley and Calyon advised Metrovacesa on the transaction. Lehman Brothers and CSFB advised Gecina.