Dom Development has entered into an agreement with Reno for the purchase of 77% of the shares in Krakow developer Sento for PLN 35.38 million.
As a result of the transaction, Dom Development S.A. has gained control over the Sento S.A. group of companies, which operates a residential development business in Kraków. The remaining 23% of the shares in Sento S.A. are controlled by persons managing that company. Dom Development S.A. has pre-emptive rights to the remaining shares and after 7 years from the date of the transaction the put and call (put and call) options on the remaining shares will become active.
The price for the remaining shares will be determined based on Sento’s future performance (the so-called earn-out clause), taking into account the financial results and balance sheet. The purchase of the remaining shares may be settled through the issue of new shares in Dom Development, with the number of shares limited to 3% of the issued share capital.
“Kraków is another agglomeration where we want to develop. It is the second largest development market in Poland after Warsaw, a city with huge potential, a large population and strong demand, which has been maintained for years. Sento fits into the profile and style of operations of Dom Development. We intend to take advantage of the very high financial resources, operational background and know-how of the Dom Development Group and Sento’s many years of experience in the highly fragmented Kraków housing market. We are pleased that Sento is becoming part of our group and we see significant potential for mutual benefits,” commented Jarosław Szanajca, CEO of Dom Development.
Sento focuses on operations in the segment of apartments and high-standard apartments. As of 31 December 2020, the company had 130 apartments on offer and 750 units in its land bank for future projects. It has completed investments such as Atrium Park, Sentopark, Monte Cassino or apartments: Kościuszki, Agrestowa, Kogucia. Currently, the largest project in the developer’s offer is the SenTOTU investment located in Górka Narodowa.
The Kraków residential market is the second largest residential sales market in Poland, which has seen significant increases in unit prices in recent years. Sales in Kraków in 2020 amounted to nearly 9,000 apartments. The sustained high demand for apartments in Kraków indicates large development opportunities for this market.
