Boeing gives up planned billions takeover in Brazil

Embraer

The Brazilian company wanted to sell its jet division.


(Photo: Reuters)

After years of preparations, the US aircraft manufacturer has canceled a major takeover in Brazil. Boeing had 80 percent of the Jet division of in a $ 4.2 billion transaction Embraer want to take over the German-French competitor airbus Attack up to 150 seats even on medium-sized aircraft.

However, Boeing announced on Saturday that Embraer had failed to meet certain contractual terms within the agreed deadline. Therefore, end the transaction. The Brazilian aviation group Embraer, who had previously described the deal as vital, initially did not want to comment.

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Does the takeover of “Victoria’s Secret” burst?

Dhe lingerie label “Victoria’s Secret”, which is already suffering due to image problems and falling sales figures, faces new problems due to the corona crisis. The financial investor Sycamore Partners wants to cancel the takeover agreed in February of a 55 percent majority stake in the fashion brand, as “Victoria’s Secret” parent company L Brands confirmed on Wednesday. Sycamore has filed a lawsuit with a Delaware court to reverse the deal. L Brands insists on the purchase contract and wants to defend himself vigorously.

It was actually decided that Sycamore Partners would have the majority control for $ 525 million ($ 485 million) and the remaining 45 percent would remain with L Brands. Overall, Victoria’s Secret was valued at $ 1.1 billion in the deal. However, because L Brands closed numerous branches, took leave of absence and suspended rental payments in the wake of the corona pandemic, the agreement was void, Sycamore argues, according to American media reports. L Brands’ stock temporarily fell over 25 percent on the stock exchange and was briefly suspended from trading.

“Victoria’s Secret” has long since developed from the figurehead to a problem at the parent company L Brands. The lingerie label, which always sent the international elite of top models on the catwalk at its pompous fashion shows, has been struggling for a long time. With its “Sex Sells” marketing, which focuses on flawless, lightly dressed women’s bodies, the label became a stumbling block in times of lively “Body Shaming” debates and the “#MeToo” movement. Reports of harassment allegations against managers recently put pressure on the underwear brand.

The agreement with Sycamore had also provided for L Brand’s controversial boss Leslie Wexner to step down as soon as the transaction was completed. But he should continue to hold a position on the board, it was said in February. The 82-year-old’s reputation has suffered heavily from his connection to American millionaire Jeffrey Epstein, who committed suicide in a New York prison last August after an abuse scandal. Wexner is said to have maintained close business relationships with Epstein for a long time, which led to fierce criticism of the L-Brands boss.

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Intensa plans to take over UBI despite corona crisis

UBI Banca

The bank is not as enthusiastic about a takeover as the large bank Intesa.


(Photo: Reuters)

Milan Despite the corona crisis, the Italian major bank Intesa Sanpaolo is sticking to the planned takeover of the smaller rival UBI Banca. All parties involved and all of Italy would benefit from a larger, stronger bank, Intesa boss Carlo Messina announced on Tuesday for the merger.

The merger had become even more important because it would make savings easier and more money available to cover loan defaults. However, UBI Banca resists the takeover, which is to result in the seventh largest money house in the euro zone.

Intesa submitted a EUR 4.9 billion offer for the UBI at the end of February – shortly before the spread of the coronavirus paralyzed the country. The medium-sized Intesa rival is based in Bergamo, in the middle of the Lombardy region, which was badly affected by the epidemic. Smaller institutes in particular would find it difficult to survive the crisis, Intesa now argued.

Thanks to the relief provided by the supervisory authorities in the corona crisis, Intesa has an even larger capital buffer than last, explained the Turin-based bank. Nonetheless, the bank is following the request of the ECB’s banking supervisory authorities to the euro zone financial institutions and will not distribute a dividend for the time being.

This leaves 3.4 billion euros in the coffers that would otherwise flow to the shareholders. The bank guards had stressed that the financial houses should not distribute dividends for 2019 and 2020 at least until October 1 of this year.

Depending on the attitude of the European Central Bank (ECB), Intesa would call a shareholders’ meeting to distribute part of the reserves to the shareholders.

More: Italy is facing the abyss due to the corona crisis.

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AMS is confident about a billion dollar capital increase

Dusseldorf The time for a capital increase worth billions could hardly be more unfavorable: The Austrian sensor specialist AMS wants to collect more than 1.6 billion euros to partially finance the takeover of the much larger competitor Osram.

In addition to the financial investor Temasek, who holds more than five percent of the shares, other important AMS investors also wanted to participate in the capital increase, the Handelsblatt learned from the AMS environment. According to industry circles, there are also hedge funds that could secure additional shares.

The deadline for the capital increase expires on Monday. In the past weeks there had been doubts as to whether the new shares could be placed with investors at all. AMS had already had to make big concessions on the price anyway; the new shares will be offered at a price of CHF 9.20.

For comparison: in autumn the AMS rate was CHF 32. In order to collect the desired amount, AMS had to offer 190 million shares. The AMS share price had temporarily dropped below CHF 9.20 in recent weeks. It was just above it at the end of last week.

The capital increase is made by the banks HSBC and UBS such as Deutsche Bank, Erste Group and others. If there were not enough interested parties for the new shares, the financial institutions would have to add the shares to their books.

AMS is relaxed

If the banks remain on too many shares, they may even have to make a takeover offer to the other shareholders. However, the capital increase could still be stopped due to a “change in the financial markets, an accident or a crisis” – as stated in a clause in the prospectus.

In the AMS environment, you are relaxed. There is definitely interest in new shares – even if nobody currently wants to quantify how high it is. If shares ended up with the banks, they could sell them later – possibly at a profit – it said. In addition, AMS has secure bridge financing with which the Osram shares could also be financed without a capital increase.

AMS had offered more than four billion euros for Osram. The Austrians already bought more than 20 percent of the shares on the stock exchange and secured the majority with the offer of EUR 41 per share, which has not yet been completed.

In German industrial circles, many feel confirmed in the face of the problems facing Austrians. “The capital increase is completely on the ropes,” says one from the Osram area. It is quite possible that a large part of the new shares will end up with the banks.

It is risky to rely on bridge financing. Because then the new group would push even higher debts. In view of the emerging economic crisis, AMS should find it difficult to reduce the mountain of debt as soon as promised.

It remains to be seen what will happen if the AMS financing model shakes and the pressure from the banks increases. “The only way out is actually that someone buys the Osram shares from them,” says German industry circles. After all, there are still financial investors who are basically interested in Osram. For example, the financial investors Bain and Advent had long bid for the ex-Siemens subsidiary, but were eventually cut out by AMS.

Strategic takeover still makes sense

In view of the unclear situation and the corona crisis, the Osram share price had fallen from 45 to temporarily 26 euros in recent weeks. When AMS confirmed its expectation to complete the acquisition in the second quarter last week, the price skyrocketed. At the end of the week it was around 32 euros.

Many investors were and are convinced of the strategic sense of the takeover of Osram from the AMS perspective. The Austrians solve two problems with it. In a consolidating market, they alone had a difficult position as a small to medium-sized player.

With the takeover, AMS can also be dependent on major customers Apple reduce. AMS is doing good business with the mobile phone manufacturer – however, a theoretically conceivable listing would be difficult for AMS.

More: Osram cashes the annual forecast due to the corona crisis

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EU Commission wants to protect companies from takeovers

Dhe EU Commission wants to better protect European companies from takeovers. Many companies are “temporarily weakened by the virus crisis,” said Commission President Ursula von der Leyen on Wednesday in Brussels. “That is why we need to know which investors outside Europe want to buy companies in need and for what purpose.” The EU must protect its important technologies and corporations. The Commission has therefore issued guidelines for the Member States to “check foreign direct investment,” said von der Leyen.

The Commission President asked the EU countries to quickly adopt appropriate protective instruments for companies if they did not yet have such regulations. Member States could restrict capital movements if non-European investments could undermine security and public order in the EU.

The Commission President also emphasized that the EU was and remains open to foreign investors. “With the guideline, we want to reconcile both the openness and the necessary protection.” The Commission did not initially publish any further details on the guidelines on Wednesday.

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AMS maintains takeover of Osram

Osram

Flags with the Osram logo: The sensor specialist AMS is sticking to its takeover plan.


(Photo: dpa)

Munich The Austrian sensor specialist AMS does not want to be put off by the takeover of Osram due to the rapid fall in the price of its shares. AMS made it clear on Thursday evening that the company is confident that it will be able to accommodate the 1.65 billion euro capital increase to finance the takeover of the Munich lighting group with shareholders and other investors.

“AMS has been in constant contact with investors since the rights issue began and has received positive feedback from a number of major shareholders who plan to exercise their rights and from other investors wishing to participate in the rights issue,” the company said.

Since the start of the subscription period on the Swiss stock exchange, the AMS shares fell in the wake of the corona crisis by two-thirds to temporarily less than the CHF 9.20 that the new shares were to cost. This made it unattractive for AMS shareholders to exercise their subscription rights for the new papers. On Thursday, AMS closed at CHF 9.28.

The risk of the capital increase failing had raised doubts on the capital market itself about the € 4.6 billion takeover itself. Investment banks guarantee the issue and would have to put unsold shares on their own books. However, you have the right to back out in the event of extreme market turmoil.

AMS CEO Alexander Everke tried to dispel the doubts: “We are more than ever convinced of the obvious strategic logic and the value creation potential from the merger of AMS and Osram.”

Osram announces short-time work in many plants

Under the impression of the virus outbreak, Osram tipped its forecast for the current financial year on Wednesday and announced short-time work in many plants. “We continue to receive positive feedback from our shareholders regarding this strategic logic and the capital increase,” emphasized Everke. He was confident that the takeover would be completed by the end of June at the latest once the remaining approvals from the antitrust authorities have been received.

More: Osram is collecting the annual forecast due to the corona crisis.

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Osram cashes the annual forecast due to the corona crisis

Osram headquarters in Munich

Munich The lighting company Osram has cashed in on his forecast for the current fiscal year 2019/20 (September 30) due to the corona crisis. The corporate goals could probably not be achieved, Osram announced on Wednesday evening.

The pandemic and countermeasures – particularly the increasing number of shutdowns by Osram’s customers and disruptions in global logistics chains – had a major impact on the global economy and the global automotive industry, Osram argued. The Osram chip division and the automotive business would suffer as a result. These represent around 50 percent of the sales of the ex-Siemens subsidiary.

Osram announced a month ago that sales would decrease by up to three percent or increase by up to three percent. Adjusted operating return on sales will be between nine and eleven percent. This forecast is no longer valid. Osram had issued several profit warnings in recent years.

The Munich group announced further austerity measures. So one takes short-time working into consideration. The temporary closure of own production facilities is also conceivable. Osram is currently about to be taken over by sensor technology specialist AMS. However, the Austrians have difficulties with the financing after a fall in their share price: The takeover is to be financed in part with the help of a capital increase, which should bring 1.65 billion euros. In financial circles it is now doubted that this can still be placed.

AMS was confident on Wednesday. “We are still as convinced of the takeover of Osram as we were at the beginning of the year and are working towards closing, and we are on track,” said a group spokeswoman for the Handelsblatt. The November takeover bid and financing remained secured. In industrial circles it was also emphasized that the Austrians had secure bridge financing. In any case, this enables them to pay the bid even without a capital increase.

AMS already holds a good 23 percent of the shares. With its takeover offer of EUR 41 per share, the group also secured a majority. The purchase has not yet been completed.

The group, based in the Styrian town of Premstätten, produces chips and sensors. The most important customer is the cell phone manufacturer Apple, which represents a large part of the turnover. Apple has been suffering from the consequences of the global corona crisis for weeks. AMS is currently only valued at around EUR 750 million on the stock exchange. The share had lost around two thirds of its value within a month.

More: Fall in price at AMS raises doubts about capital increase for Osram purchase

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Small shareholders receive less money than Petrus when they take over Comdirect

Comdirect

Commerzbank wants to force the remaining shareholders out of the company and then integrate the online bank.


(Photo: dpa)

Frankfurt The Commerzbank drives the complete takeover of her online subsidiary Comdirect Ahead. The Frankfurt-based company announced on Monday evening that it would squeeze out the remaining Comdirect shareholders against a cash settlement of EUR 12.75 per paper.

“The determination of cash compensation for Comdirect shareholders is the next step on the road to a merger squeeze-out,” said Commerzbank CEO Martin Zielke. “After the Comdirect Annual General Meeting, we will push ahead with integration at full speed.”

The Comdirect price on the stock exchange is currently still above the planned cash compensation. Despite the corona crisis, the stock has been relatively stable in recent weeks. On Monday, too, it only dropped 1.2 percent to EUR 13.62.

Commerzbank had only offered EUR 11.44 per share for Comdirect in the context of a public takeover bid last year – and had therefore failed.

At the beginning of 2020, the institute then bought its activist investor Petrus Advisers from its Comdirect share package of around eight percent for EUR 15.15 per paper. At the time, Commerzbank justified the significantly higher price by being able to integrate Comdirect faster and more efficiently in this way. “It is clear that a premium has to be paid for such a share package.”

According to experts, it is legally permissible for small shareholders to receive a lower price when taking over than a large shareholder. “In the Comdirect case, Commerzbank, for example, is avoiding a lengthy merger in the course of a share swap,” said business lawyer Christoph Seibt, partner in the Freshfields Bruckhaus Deringer law firm, in January.

Judicial review

Two different prices are determined as part of the squeeze-out procedure. A company valuation is carried out according to the standard of the institute for auditors, which is checked for appropriateness by a court-appointed expert. And the volume-weighted average price over the past three months before the official announcement of the squeeze-out is calculated.

The cash compensation for the shareholders is then based on the higher price that has come out of the two procedures. In the case of Comdirect, this is the average price before the announcement of the squeeze-out, which amounts to EUR 12.75 per share.

In the company valuation, the auditing firm Warth & Klein put the value of Comdirect at EUR 1.577 billion, which corresponds to a value per share of EUR 11.17, as Commerzbank explained. “The appropriateness of the cash compensation is still checked by the court-appointed and appointed expert auditor Baker Tilly.”

By integrating Comdirect, Commerzbank wants to save costs and drive the digitization of the money house. Through the agreement with Petrus, the institute, which previously held 82.3 percent of Comdirect, has increased its stake to 90.29 percent – and can now force the other shareholders out of the company.

The whole thing is to be decided at the Comdirect Annual General Meeting in May. The entry in the commercial register is then planned for autumn.

More: Before takeover by Commerzbank: Comdirect boss Hegemann fights for employees.

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US agency approves Infineon’s billion-dollar acquisition of Cypress Semi

Investors were pleased to hear the news on Tuesday morning. The share price rose 6.5 percent on Tuesday afternoon. This made Munich one of the biggest winners in the Dax. Cypress shares also rose significantly: in pre-exchange trading, the papers turned almost 48 percent up.

This means that Ploss has probably overcome the biggest hurdle of the transaction that was announced in June. At the end of last week, the American news agency Bloomberg reported that the committee for foreign investments in the USA (CFIUS) assessed the takeover as a risk to national security.

Infineon tried to reach an agreement with the US government, but failed. According to Bloomberg, US regulators feared that the transaction could put American know-how in the hands of the Chinese. Infineon generates a good quarter of its sales in the People’s Republic.

Infineon was apparently able to address these concerns. Of course it is not. US President Donald Trump has already banned two major deals in the semiconductor industry. The takeover of the leading manufacturer of mobile phone chips, Qualcomm, by Broadcom, and the sale of Lattice Semiconductor to investors connected to China.

Infineon itself had already failed in 2017 when it tried to buy its American competitor Wolfspeed. Even then, the CFIUS authority had concerns.

Largest acquisition since the 1990s

With Cypress, Infineon will strengthen its core business of power semiconductors, sensors and security controllers, Ploss said at the general meeting in mid-February. In this way, Infineon can serve a wider range of applications and offer customers complete solutions.

The group will also advance to the top ten largest chip manufacturers in the world. It is by far the largest acquisition since the company was spun off from Siemens Late 90s.

However, the shareholders do not only see the takeover as positive. The strategic logic is obvious, said Markus Golinski, Union Investment’s portfolio manager at the Annual General Meeting. Infineon will thus become the world’s largest chip supplier for the automotive industry, get better access to the Japanese market and close the product gap in microcontrollers.

However, the shareholders would pay a high price for this: on the one hand through the dilution effect, which had particularly hurt due to the capital increase in June at low prices. Secondly, due to the rise in debt, which could lead to a deterioration in the credit rating and thus to higher financing costs. “What return this investment of nine billion euros will generate is still uncertain,” complained Golinski.

But that’s not all: “The desired strengthening of the market position, the planned synergy effects and the resulting higher profits have yet to be demonstrated.”

However, Ploss has the backing of the supervisory board for the mega purchase: “We are fully behind the acquisition,” said its chairman Wolfgang Eder recently at the general meeting. It is important to secure Infineon’s growth course. The purchase price was justified, said the ex-boss of the Austrian steel producer Voestalpine.

But the purchase is not yet completely through. Infineon said it still lacked approval from the Chinese market administration. Industry observers believe, however, that the People’s Republic has no objection to the acquisition.

After all, the country has an interest in strong chip manufacturers from Europe. Trump pushed through delivery restrictions for American semiconductor manufacturers in the trade dispute with China last year. So it is good to have alternatives.

More: Read here how Ploss is expanding Infineon into a car supplier.

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Infineon has to tremble for billion dollar deal in the United States

Munich For months InfineonChief Reinhard Ploss fought for the nine billion euro deal. Now everything looks like his efforts have been in vain. Because the US authorities are against buying the American competitor Cypress through Germany’s largest semiconductor manufacturer.

The American news agency Bloomberg reports with reference to people familiar with the process. Accordingly, the Committee for Foreign Investment in the United States (CFIUS) considers the takeover to be a risk to national security. Infineon tried to reach an agreement with the US government, but failed.

The DaxGroup did not want to comment on Friday morning when asked by Handelsblatt. Current proceedings were not commented on, it said. The US authorities and Cypress also made no comments. The US regulators apparently fear that the transaction could put American know-how in the hands of the Chinese. Infineon generates a good quarter of its sales in the People’s Republic.

The US President has the final say on the matter. Donald Trump has already banned two big deals in the semiconductor industry. The takeover of the leading manufacturer of mobile phone chips, Qualcomm, by Broadcom, and the sale of Lattice Semiconductor to investors connected to China.

Infineon itself failed in 2017 when it tried to buy its American competitor Wolfspeed. Even then, the CFIUS authority had concerns. Just two weeks ago, Infineon’s boss Ploss said that his company was in “productive talks” with the authorities in the United States.

At the Annual General Meeting, the manager was confident: “As of today, we expect to be able to complete the takeover towards the end of this or the beginning of the coming quarter.” Ploss had announced the largest transaction in the company’s history last June, and discussions have continued since then .

Americans are afraid of China’s influence in the future

“At Infineon, the CFIUS is particularly concerned that one day the Chinese will take over Infineon completely or at least a large part of it and thus gain access to these important technologies,” explains Roger Entner, founder of the industry consultancy Recon Analytics. He therefore considers a ban likely. The US agency CFIUS for foreign investments is finally becoming clearer that semiconductors are used in both the civilian and the military sector.

“German companies in particular are considered susceptible to Chinese influence,” says Roger. After all, there have been cases like Kugler in Germany, in which Chinese people got in to get the technology.

Nevertheless, Entner does not really believe that the Cypress takeover by Infineon is really a danger. The Americans would theoretically also have the option of preventing a potential Chinese takeover of Infineon.

But it is also a political question: “If the relationship between Germany and the United States were closer, these problems would be smaller”, Entner is convinced.

Shareholders would pay a high price

Should Trump actually ban the purchase, it would be a big blow to Ploss. With Cypress, Infineon will strengthen its core business of power semiconductors, sensors and security controllers, Ploss said at the general meeting in mid-February. In this way, Infineon can serve a wider range of applications and offer customers complete solutions.

Nothing should come of it now. In addition, the group would have advanced among the ten largest chip manufacturers in the world. The shareholders did not only see the takeover as positive anyway. The strategic logic is obvious, said Markus Golinski, Union Investment’s portfolio manager at the Annual General Meeting.

Infineon will thus become the world’s largest chip supplier for the automotive industry, gain better access to the Japanese market and close the product gap in microcontrollers. However, the shareholders would pay a high price for this: Firstly, through the dilution effect, which had particularly hurt due to the capital increase in June at low prices.

Secondly, due to the rise in debt, which could lead to a deterioration in the credit rating and thus to higher financing costs. “What return this investment of 9 billion euros will generate is still uncertain,” complained Golinski.

But that’s not all: “The desired strengthening of the market position, the planned synergy effects and the resulting higher profits have yet to be shown.” In addition, the price is at the pain threshold. However, some shareholders have long doubted that Infineon will even get the approval would.

“We have had bad experiences in the US”, emphasized Daniela Bergdolt from the German Association for the Protection of Securities (DSW). The shareholder protector could be right. If the takeover actually bursts, Infineon should receive high compensation payments.

In addition, the group is sitting on several billion euros that it has already secured for the takeover – through a capital increase and through bonds. Cypress stocks lost nearly a fifth of their value in New York on Thursday. Infineon’s papers fell a good four percent on Friday morning in early trading in Frankfurt.

More: The chipmaker has been concerned about the approval of a purchase in America by the authorities for months.

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