G City is making a second attempt to take full control of its Scandinavian subsidiary Sittikon, after already lifting its stake to 86.3% in an earlier tender offer. The company said it will submit another offer for the remaining minority shares at 2.9 euros per share, about 7% above Sittikon’s closing price of 2.7 euros on the Helsinki exchange, and the stock rose by a similar amount on the announcement.
If G City secures more than 90% of Sittikon, it can force the purchase of the rest of the shares and delist the company from the Finnish stock exchange. A full acceptance would cost about 72 million euros. G City plans to finance the deal with a 195 million-shekel credit line it arranged for the previous tender offer, which was completed in March.
Sittikon operates income-producing real estate, mainly shopping centers, in Finland, Estonia, Norway, Sweden and Denmark. In November, G City increased its holding to 57.4% after buying 7.7% from institutional investors, mainly foreign, for 57 million euros. Because that pushed it above 50%, Finnish law required a tender offer for the rest of the shares.
That earlier offer was launched at 4 euros per share, when Sittikon traded at 2.94 euros. G City, controlled by Chaim Katzman through Norstar, later said full acceptance would have cost 312 million euros, but investors tendered only part of their holdings. G City ended up buying 27.2% more and reaching 86.3%, while the effective cost fell to 26 million euros after Sittikon paid dividends during the process.
The stock has been weak for years, losing 63% over the five years before the first bid and falling 31% since the start of this year through yesterday’s close. G City, formerly Gazit Globe, carried out a similar move in 2022 when it spent about 1.3 billion shekels to buy minority shares in Atrium, later renamed G City Europe, a step that increased leverage and raised investor concerns. Katzman has recently said he is ending his CEO role and moving to chairman.
