Amsterdam-listed real estate companies Nieuwe Steen Investments (NSI) and Vastned Offices/Industrial (VNOI) have announced that their merger talks have broken down, with both sides blaming the other for the failure.

NSI said in a statement on Sunday that VNOI's management had rejected an improved offer following 'two months of diligent attempts and intensive negotiations throughout the weekend'. NSI said that its final offer of 0.88 NSI shares for each VNOI share and a cash consideration was an implied premium of 18-20% on the basis of VNOI share price prior to the announcement of the potential merger talks on 10 December 2010.

VNOI hit back: 'The negotiations about a possible legal merger between VNOI and NSI started last week, however NSI reported Sunday evening not to be willing anymore to continue talking.'

Vastned said the exchange ratio proposed by NSI represented a significant discount versus the net asset value of VNOI's Dutch and German portfolio.
'The exchange ratio offered by NSI, with which significant dilution would occur, reflects completely insufficiently the underlying values of VNOI and is therefore not acceptable to VNOI, particularly also in the interest of its shareholders.' VNOI said its view was supported by an independent valuation carried out as part of a due diligence process.

'NSI has so far during the negotiations not appeared to be prepared to make a realistic and for VNOI acceptable proposal.' VNOI said it was still open to further talks with NSI and would also investigate 'strategic alternatives'.