Real Estate Central

HAMBURG, Germany, June 24 /PRNewswire/ — The offer by the investor
group coordinated by J.C. Flowers to acquire a 20.0 to 24.9 per cent stake
in Hypo Real Estate Holding AG (”HRE”) for a price of EUR 22.50 per share
has found shareholders’ acceptance. Until 23 June 2008, 17:00h, a total
number of 48,535,033 tendered shares had been allocated to the respective
Clearstream account. This represents 24.13 per cent of the currently
outstanding share capital. However, shares which have been tendered by
shareholders until the end of the tender period on 23 June 2008, 24:00h
CET, will still be accounted for by the depository banks. Hence, the total
number of shares to be sold will likely increase and the investor group is
confident that the maximum intented tender quote of 24.9 per cent will be
reached. As already indicated, in case of an oversubscription, a pro-rata
allocation of the tendered shares will take place. After the closing of the
transaction, the investor group coordinated by J.C. Flowers expects to hold
a 24.9 per cent stake in HRE and to pay a total cash consideration of EUR
1.1 billion. All conditions precedent are now fulfilled and the transaction
will close with the final allocation of shares and the payment of the
purchase price in the course of next week. The announcement of the specific
number of tendered shares is expected to be made by Thursday, 26 June 2008.

The voluntary public tender offer was made by HRE Investment Holdings
L.P., an investment vehicle established for this purpose on behalf of
trusts advised by J.C. Flowers & Co. LLC and funds managed by affiliates of
Grove International Partners LLP. The maximum acquisition of 24.9 per cent
of HRE’s total share capital corresponds to a total number of shares of
50,076,000. This number does not include additional shares which will be
issued in August 2008 as a result of the conversion of the mandatory
convertible bonds of HRE relating to the financing of the DEPFA
acquisition.

The offer price of EUR 22.50 per share represented a premium of 25.3
per cent to the weighted average price quoted on Xetra over the last three
months until 15 April 2008, the day immediately prior to the announcement
of the intended offer (EUR 17.95).

The group of investors are mid-term oriented and focused to strengthen
HRE. The investors will support the company in its strategy to expand its
position as one of the leading financial institutions in commercial real
estate and public sector financing, as well as to encourage HRE’s
management to pursue future growth potential. This includes potential
business expansion opportunities in German and international markets,
including the Japanese market. One significant opportunity might be a
business cooperation with Shinsei Bank Ltd. regarding commercial real
estate and public sector financing in Japan. Shinsei Bank will hold an
indirect stake in the transaction through its investments in trusts advised
by J.C. Flowers and funds managed by affiliates of Grove. Additionally the
group of investors will offer its extensive network of contacts, expertise
and support regarding possible future business expansion opportunities. The
group seeks to reflect its investment by a proportional representation of
supervisory board seats of HRE.

The group of investors has been advised by Morgan Stanley and Hengeler
Mueller in connection with the transaction.

About J.C. Flowers:

JC Flowers was founded in 2002 and is the largest private equity firm
worldwide that is exclusively devoted to the financial services sector. JC
Flowers has invested equity capital of USD 9 billion in over 20
transactions in the financial institutions sector: of these, seven
transactions (representing over 50 per cent of equity) have been in Europe.
The firm closed its second fund in 2007, JC Flowers Fund II LP, which has
equity capital of over USD 7 billion. JC Flowers is represented with
offices in New York, London, Hamburg and Beijing. The international,
strategically oriented financial investor Flowers has been successfully
active in the German market since 2004. Latest transactions comprise the
acquisition of a 26.58 per cent stake in HSH-Nordbank by funds advised by
J.C. Flowers in October 2006, which is now supplemented in the proportional
participation in the agreed-upon capital measures at HSH, totalling EUR 2
billion. For further information please see http://www.jcfco.com/.

About Grove International Partners LLP:

Grove is a global real estate private equity firm founded in 1999 and
managing total committed capital of USD 5 billion. The firm closed its
third fund in June 2007 with capital commitments of USD 2 billion. Funds
managed by affiliates of Grove invest in global real estate private equity
and real estate related opportunities through dedicated operating
platforms. Platforms formed and supported by Grove have actively acquired
assets located in Germany in multiple sectors since 2003. In 2007, funds
managed by affiliates of Grove acquired Aurelis, the real estate subsidiary
of Deutsche Bahn, together with Hochtief AG in a transaction valued at EUR
1.6 billion. Grove and its affiliates operate from offices in New York,
London, Frankfurt, Amsterdam, Tokyo and Singapore. For further information
please see http://www.groveinvestors.com/.

About Shinsei Bank Limited:

Shinsei Bank is a leading diversified Japanese financial institution
providing a full range of financial products and services to both
institutional and retail customers based on a three pillar strategic
business model comprising of institutional banking, consumer and commercial
finance and retail banking. The bank has total assets of USD 104 billion on
a consolidated basis (as of December 2007) and a network of 42 branches.
For further information please see http://www.shinseibank.com/english/.



Contact person:

Thomas Pfaff Kommunikation
Phone: +49-89-992496-50
Fax: +49-89-992496-52
Mobile: +49-172-8312923
kontakt@pfaff-kommunikation.de

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[Via Real Estate Newswire]