Exchange offer and capital increase in connection with the announced voluntary public takeover offer by DEMIRE Deutsche Mittelstand Real Estate AG for all outstanding shares in Fair Value REIT-AG

DEMIRE Deutsche Mittelstand Real Estate AG  / Key word(s): Offer

31.07.2015 08:40

Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted
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THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE,
PUBLICATION OR DISTRIBUTION, EITHER IN WHOLE OR IN PART, IN THE USA,
CANADA, AUSTRALIA, JAPAN OR OTHER JURISDICTIONS WHERE TO DO SO WOULD
CONSTITUE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

Exchange offer and capital increase in connection with the announced
voluntary public takeover offer by DEMIRE Deutsche Mittelstand Real Estate
AG for all outstanding shares in Fair Value REIT-AG

Frankfurt/Main, 31 July 2015 - Today, the Executive Board and the
Supervisory Board of DEMIRE Deutsche Mittelstand Real Estate AG decided to
offer the shareholders of Fair Value REIT-AG the acquisition of their
no-par value bearer shares by way of a voluntary public takeover offer in
the form of an exchange offer (the "Takeover Offer"). In addition, DEMIRE
Deutsche Mittelstand Real Estate AG and Fair Value REIT-AG today also
signed a basic agreement (so-called "Business Combination Agreement").
Further, DEMIRE Deutsche Mittelstand Real Estate AG entered into various
tender agreements with certain shareholders of Fair Value REIT-AG, in which
these shareholders undertake to accept the Takeover Offer for their Fair
Value shares (so-called "Tender Commitments"). The successful completion of
the Takeover Offer would create a real estate group with a commercial real
estate portfolio totalling around EUR 1 bn.

PUBLIC TAKEOVER OFFER BY DEMIRE DEUTSCHE MITTELSTAND REAL ESTATE AG FOR ALL
OUTSTANDING SHARES OF FAIR VALUE REIT-AG

DEMIRE Deutsche Mittelstand Real Estate AG intends to offer the
shareholders of Fair Value REIT-AG two (2) new no-par value bearer shares
of DEMIRE Deutsche Mittelstand Real Estate AG, each representing a pro rata
amount of the registered share capital of EUR 1.00 each and a right to
dividends as of 1 January 2015 (the "DEMIRE Shares") from the capital
increase in kind (the "Capital Increase"), still to be resolved by the
General Meeting, in exchange for one (1) Fair Value share tendered to
DEMIRE Deutsche Mittelstand Real Estate AG in the context of the Takeover
Offer, subject to the final determination of a minimum offer price and the
final terms in the offer document. This Takeover Offer provides Fair Value
shareholders with an 11.00 percent premium compared to the valuation of
both companies based on the refined EPRA NAV per share (adjusted, diluted)
(status as of 27 July 2015).

DEMIRE Deutsche Mittelstand Real Estate AG's Takeover Offer will presumably
be made subject to, inter alia, a minimum acceptance ratio of 50.1% of the
outstanding Fair Value shares, the absence of material transactions,
material adverse effects, or material compliance violations, as well as the
registration of the implementation of the capital increase. Otherwise, the
Takeover Offer will be made in accordance with the terms and conditions set
out in the offer document to be approved by the German Federal Financial
Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht,
BaFin). Insofar as legally permissible, DEMIRE Deutsche Mittelstand Real
Estate AG reserves the right to deviate in the final terms and conditions
of the Takeover Offer from the basic information described herein.

The offer document will be published on the internet following clearance by
the German Federal Financial Supervisory Authority at: https://www.demire.ag
under the section "Investors Relations".

DETAILS ON THE EXECUTION OF THE TAKEOVER OFFER

The new DEMIRE Shares to be offered shall be created by way of a capital
increase in kind still to be resolved and excluding DEMIRE Deutsche
Mittelstand Real Estate AG shareholders subscription rights. For the
purpose of resolving the capital increase, DEMIRE Deutsche Mittelstand Real
Estate AG will convene an Extraordinary General Meeting at short notice,
presumably on 14 September 2015. At the Extraordinary General Meeting,
DEMIRE Deutsche Mittelstand Real Estate AG's share capital shall be
increased by up to EUR 30,761,646.00 against contribution in kind by
issuing up to 30,761,646 no-par value bearer shares each representing a pro
rata amount of the registered share capital of EUR 1.00 per share. DEMIRE
Deutsche Mittelstand Real Estate AG will appoint a trustee who will
subscribe to the new DEMIRE Shares for the benefit of the Fair Value
REIT-AG shareholders and transfer the new DEMIRE Shares to those Fair Value
REIT-AG shareholders that have tendered their Fair Value shares in
connection with the Takeover Offer.

BUSINESS COMBINATION AGREEMENT BETWEEN DEMIRE DEUTSCHE MITTELSTAND REAL
ESTATE AG AND FAIR VALUE REIT-AG

In relation to the Takeover Offer, DEMIRE Deutsche Mittelstand Real Estate
AG and Fair Value REIT-AG have today entered into a Business Combination
Agreement in which both companies have stipulated their current
understanding in terms of the execution of the Takeover Offer and the
general support of the Takeover Offer by the Management Board of Fair Value
REIT-AG. The objective of the acquisition is to create a sizable player in
the German stock market-listed real estate sector with a stable rental
profile and to establish a leading holder of office, retail and logistics
properties in German secondary locations. Subject to a review of the offer
document including a final valuation analysis of the adequacy of the offer
consideration, the Management Board and the Supervisory Board of Fair Value
REIT-AG intend to support the Takeover Offer and to recommend to the Fair
Value REIT-AG shareholders to accept the Takeover Offer.

DEMIRE Deutsche Mittelstand Real Estate AG and Fair Value REIT-AG have also
agreed that Mr. Frank Schaich will remain a member of the Management Board
of Fair Value REIT-AG. DEMIRE Deutsche Mittelstand Real Estate AG and Fair
Value REIT-AG also plan to keep their respective corporate seats in
Frankfurt/Main and Munich. DEMIRE Deutsche Mittelstand Real Estate AG will
make their best effort not to jeopardise Fair Value REIT-AG's REIT status
as long as Fair Value REIT-AG is organised as a REIT according under its
Articles of Association. It is also intended to continue Fair Value
REIT-AG's current dividend policy.

TENDER COMMITMENT WITH MAJOR SHAREHOLDERS 

Today, DEMIRE Deutsche Mittelstand Real Estate AG entered into Tender
Committments with Obotritia Beteiligungs GmbH, Försterweg Beteiligungs
GmbH, Jägersteig Beteiligungs GmbH and Kienzle Vermögensverwaltungs GmbH
(together referred to as the "Package Shareholders"), who own in total
approx. 23.21% of the shares and voting rights of Fair Value REIT-AG. In
this agreement, the Package Shareholders irrevocably undertake to tender
their Fair Value shares in connection with the Takeover Offer.
Simultaneously, the Package Shareholders have already declared their
withdrawal from their acceptance of the Takeover Offer pursuant to the
Tender Commitments if and to the extent that the number of Fair Value
shares tendered in connection with the Takeover Offer would lead to DEMIRE
Deutsche Mittelstand Real Estate AG holding more than 94.9% of the share
capital and voting rights of Fair Value REIT-AG.

Frankfurt/Main, 31 July 2015

DEMIRE Deutsche Mittelstand Real Estate AG

The Executive Board

Disclaimer

This announcement is neither an offer to exchange nor a solicitation of an
offer to exchange Fair Value shares. Moreover, this announcement is neither
an offer to purchase nor a solicitation to purchase any DEMIRE Deutsche
Mittelstand Real Estate AG shares. The final terms and further provisions
regarding the public Takeover Offer will be disclosed in the offer document
after the publication has been approved by the German Federal Financial
Supervisory Authority. DEMIRE Deutsche Mittelstand Real Estate AG reserves
the right to deviate in the final terms and conditions of the public
Takeover Offer from the basic information described herein. Investors and
holders of Fair Value shares are strongly recommended to read the offer
document and all other documents in connection with the Takeover Offer as
soon as they are published because they contain important information.

Subject to the exceptions described in the offer document, as well as any
exemptions that may be granted by the relevant regulators, a takeover offer
will not be made, neither directly nor indirectly, in any jurisdiction
where to do so would constitute a violation of the national laws of such
jurisdiction.
 
Shares of DEMIRE Deutsche Mittelstand Real Estate AG have not been nor will
they be registered under the U.S. Securities Act of 1933, as amended, or
with any securities regulatory authority of a state or any other
jurisdiction in the USA or any other foreign jurisdiction. Therefore,
subject to certain exceptions, DEMIRE Deutsche Mittelstand Real Estate AG
shares must not be offered or sold within the USA or any other jurisdiction
where to do so would constitute a violation of the national laws of such
jurisdiction. There will be no registration of the DEMIRE Deutsche
Mittelstand Real Estate AG shares mentioned in this announcement pursuant
to the relevant laws in the USA or any other foreign legal system.

To the extent this announcement contains forward-looking statements, also
with respect to the Takeover Offer, such statements do not represent facts
and are characterised by the words "will", "expect", "believe", "estimate",
"intend", "aim", "assume" or similar expressions. Such forward-looking
statements express the intentions, opinions or current expectations and
assumptions of DEMIRE Deutsche Mittelstand Real Estate AG and the persons
acting in concert with DEMIRE Deutsche Mittelstand Real Estate AG. Such
forward-looking statements are based on current plans, estimates and
forecasts which DEMIRE Deutsche Mittelstand Real Estate AG and the persons
acting in concert with DEMIRE Deutsche Mittelstand Real Estate AG have made
to the best of their knowledge, but which do not claim to be correct in the
future. Forward-looking statements are subject to risks, uncertainties and
changes in the accompanying circumstances that for the most part are
difficult to predict and usually cannot be influenced by DEMIRE Deutsche
Mittelstand Real Estate AG or the persons acting in concert with DEMIRE
Deutsche Mittelstand Real Estate AG. These expectations and forward-looking
statements can prove to be incorrect and the actual events may differ
materially from those contained in such forward-looking statements. DEMIRE
Deutsche Mittelstand Real Estate AG and the persons acting in concert with
DEMIRE Deutsche Mittelstand Real Estate AG do not assume an obligation to
update the forward-looking statements with respect to actual developments,
events, basic conditions, assumptions or other factors.

Contact
DEMIRE Deutsche Mittelstand Real Estate AG
Investor Relations
Lyoner Straße 32
60528 Frankfurt am Main
Phone: +49 (0) 69-719 189 79 0
Fax: +49 (0) 69-719 189 79 11
ir@demire.ag
www.demire.ag 

Investor Relations
GFEI Aktiengesellschaft
Lars Kuhnke
Phone: +49 (0) 511 4740 2310
ir@demire.ag


31.07.2015 The DGAP Distribution Services include Regulatory Announcements,
Financial/Corporate News and Press Releases.
Media archive at www.dgap-medientreff.de and www.dgap.de

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Language:     English
Company:      DEMIRE Deutsche Mittelstand Real Estate AG
              Lyoner Straße 32
              60528 Frankfurt am Main
              Germany
Phone:        +49 (0)69  / 719 189 79 0
Fax:          +49 (0)69  / 719 189 79 11
E-mail:       info@demire.ag
Internet:     www.demire.ag
ISIN:         DE000A0XFSF0
WKN:          A0XFSF
Listed:       Regulated Market in Frankfurt (General Standard); Regulated
              Unofficial Market in Berlin, Stuttgart
 
End of Announcement                             DGAP News-Service
 
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