GlobeSt.com UPDATE: Metrovacesa Ups Its Stake in Gecina to Nearly 70%

In March, Metrovacesa bought a 30% stake in Gecina for euro 1.64 billion ($2 billion) from Allianz AG Holding's French unit Assurances Generales de France SA and French mutual insurer Azur-GMF. It also launched a tender offer for the rest of France's biggest real estate company. Joaquin Rivero, the Spanish company's chairman, said at a press conference at the end of April that Metrovacesa was hoping to hold 80% of Gecina after the bid.

The deal marked the largest cross-border merger in Europe's real estate industry. With the control of Gecina, Metrovacesa boasts more than euro 13.6 billion ($16.66 billion) in assets and about euro 1.4 billion ($1.7 billion) in joint annual revenue. The newly combined group is now bigger than Netherlands-based Rodamco Europe NV and Spain's Fadesa Inmobiliaria and marginally smaller than the UK's British Land.

Metrovacesa is Spain's biggest property company following its 2003 merger with Bami. The company develops and leases residential and office space, and it has a portfolio totaling 1.2 million sm. The firm also develops and sells apartment blocks, shopping centers, parking lots and other property. Metrovacesa operates about seven hotels and plans to develop more; brands under management include Holiday Inn and Crowne Plaza. Primary tenants include the Madrid Stock Exchange and H&M.

Rivero announced in April that the company would fund the euro 5.5-billion ($6.72-billion) acquisition through the sale of two of Madrid's two oldest skyscrapers. One is the landmark Torre de Madrid, which is expected to fetch about euro 650 million ($795 million), making it the largest property deal in Spanish history. The other is the Edificio España, which currently houses the Hotel Crowne Plaza and is expected to sell for about euro 400 million ($489 million). The two sales will take place by the end of the year.