Vonovia offers new Deutsche Wohnen at a price of 53 Euros/hour. Reuters

FRANKFURT (Reuters)-German real estate company Vonovia said on Sunday that it had acquired competitor Deutsche Wohnen (OTC:) at a high price of 19.1 billion euros ($22.7 billion).

Vonovia plans to submit a new offer at a price of 53 euros per Deutsche Wohnen share, subject to approval by the German financial regulator BaFin. Last month, Vonovia nearly missed the 50% threshold with an agreed price of 52 euros per share.

The country’s largest merger this year will create a European real estate giant with 550,000 apartments, with a total book value of more than 80 billion euros. Deutsche Wohnen has become the focus of anger among Berliners over tenant rights and affordable housing.

Since the failed offer last month, Vonovia has acquired slightly less than 30% of its competitors’ shares, some of which are through the purchase of treasury shares at a price of 52 euros per share. It now requires a Bafin exemption-which is seen as a form-to submit a new offer immediately instead of waiting a year before submitting a new offer.

Vonovia kept the key terms of the transaction unchanged, including a minimum acceptance threshold of 50%. It also does not include a three-year governance agreement.

The offer announced in May failed because some shareholders refused to bid for their shares, believing that it underestimated the value of Deutsche Wohnen.

In addition, some hedge funds did not bid or only bid a small amount of their holdings, hoping to acquire more shares at a later stage.

According to German law, once the 75% equity threshold is exceeded, any acquirer can reach a so-called dominance agreement, thereby being able to control the cash flow of the target company. However, in this case, the acquirer must provide compensation for the refusal that is usually higher than the original offer.

Vonovia’s first attempt to acquire Deutsche Wohnen in 2016 failed due to resistance from the target company, but this time the CEO of Deutsche Wohnen supported the deal. Deutsche Wohnen reiterated on Sunday that this is still the case.

The merger plan of the two largest listed landlords in Germany has caused controversy in Germany because of the tensions caused by soaring rents before the September election. The executives promised that the combined company will work with politicians to provide affordable housing.

Rolf Buch, CEO of Vonovia, said: “We stand by our commitment as a reliable political partner and use our comprehensive strength to meet the challenges of the real estate market.”

(1 USD = 0.8428 Euro)