Vonovia’s corruption scandal ends in prison sentences as recovery begins
A long-running corruption scandal at Vonovia has reached its legal conclusion, though the fallout continues to shape the company’s future. Two former executives were sentenced to prison for accepting bribes, while the judge highlighted past compliance failures. Despite this, the property giant has taken steps to rebuild trust under new leadership.
The scandal centred on rigged contract awards and 'ghost invoices'—fake billing documents used to siphon funds. Two senior figures at Vonovia were found guilty of taking bribes totalling around €200,000. Their convictions marked the end of the court case, but the judge’s remarks underscored deeper issues with oversight and internal controls.
In response, the company has worked to stabilise its position. On January 15, it repaid a €750 million bond, proving its ability to manage debt. This move signalled financial resilience, even as investors remained wary. Under incoming CEO Luka Mucic, set to take full charge by the end of 2025, Vonovia is refocusing on core operations. Mucic has pledged a cultural shift, aiming to restore credibility through transparency and efficiency. His strategy includes operational improvements and a push for growth, with eight out of nine market analysts now recommending the stock—targeting an average price of €36.99. A board member further reinforced confidence by purchasing shares. The company has also launched a pilot in Duisburg, testing modular 'heat-pump cubes' to reduce energy retrofit costs. If successful, the technology could lower expenses and boost future profit margins. Yet investor reaction stayed cautious. Vonovia’s share price closed the week slightly down at €25.23, reflecting lingering uncertainty despite the steps forward.
The legal resolution of the scandal removes one hurdle, but Vonovia still faces the task of fully regaining investor trust. The repayment of a major bond and new initiatives like the Duisburg pilot show progress, while leadership changes aim to drive long-term stability. Market analysts remain largely optimistic, though share performance suggests a wait-and-see approach.
