Germany's biggest public-sector bank LBBW has excluded Deutsche Wohnen from bidding for its real estate assets. In a statement on Tuesday, Deutsche Wohnen has confirmed its exclusion from the bidding process, expressing regret for this development.

The company had submitted a bid by the end of September deadline in order to have access to the data room for a detailed due diligence. It is understood that the exclusion was a result of Deutsche Wohnen's breach of non-disclosure agreements. 'We will continue to pursue a successful course of expansion,' CEO Michael Zahn said.

Investors still in the running to buy the 21,500 flats reportedly include Patrizia Immobilien, a local consortium including the city of Stuttgart, as well as buyout firms Blackstone and Cerberus.

The portfolio is expected to fetch around EUR 1-1.5 bn.

LBBW started the sale of the flats in July to comply with European Union requirements. It aims to complete the auction by the end of this year.