FRANKFURT (Reuters) - Under fire for a potential conflict of interest, the chief executive of German property company TAG Immobilien TEGG.DE will transfer all of his private real estate investments to a trustee by the end of the year, TAG said on Wednesday.
A newspaper alleged earlier this month that Rolf Elgeti was not fulfilling his fiduciary responsibility to look after the best interests of his shareholders.
“I want to counteract the uncertainty that has arisen with all the means at my disposal and underscore that the future of TAG is my top priority,” Elgeti said in a statement on Wednesday.
“Shareholders, tenants, partners and employees have been and continue to be the focus of my professional interest since I took office.”
German weekly Welt am Sonntag reported on October 6 that Elgeti had demonstrated poor judgment in some of his own property transactions and that the company had overpaid on other deals, sending shares as much as 12 percent lower.
The newspaper said Elgeti’s private investments in various companies buying and managing real estate constituted a conflict of interest with TAG, citing specifically the purchase of a high-rise in the northern German city of Rostock by a company in which Elgeti holds a stake.
TAG Immobilien, a German midcap, last week said it would commission an external review to dispel the allegations made by the paper and expressed its support of the CEO.
The company has said its supervisory board had been informed of Elgeti’s stakes in 23 real estate-owning companies and that his contract allowed him to maintain his investments as long as there was no conflict of interest or negative impact on his work.
Reporting by Christiaan Hetzner; Editing by David Cowell