Capital News

TUI AG: Taking a Diet Hanover

The COVID pandemic has unexpected consequences. For example, TUI´s shareholders learned that in May this year the company has reached an agreement to dispose of its 49% holding in the RIU Hotels S.A. joint venture to the partner Saranja S.L., which is a company owned by the RIU Group. RIU Hotels S.A. owns a real estate portfolio of 21 properties. Its enterprise value is approx. 1.5 bn EUR, and TUI´s minority stake is valued at 670 million EUR, including an earn-out-element. Therefore, the expected net cash consideration (pre earn-out) amounts to 540 million EUR at the closing of the transaction. The additional earn-out-component is payable based on RIU Hotels S.A. delivering the budgeted operating results for FY 2022 and 2023. 

Per 30 September 2020 RIU Hotels S.A. generated a total revenue of 226 million EUR, and underlying EBIT of 28 million EUR, an EAT of 10 million EUR and the EAT of TUI´s 49% stake amounted to 5 million EUR, while the book value totaled 433 million EUR. The sale, which is expected to be completed later this year, is subject to financing agreements and the usual regulatory approvals. It does not impact the 50:50 joint venture between RIU and TUI regarding the management and distribution of all RIU hotels and resorts worldwide.

OSRAM Licht AG: The last one please turns off the Light!

A delisting is always a logical step on the way to complete a takeover of a company. The whole thing is based on a simple thought. Since the dominant majority shareholder is now taking responsibility for the financing, the free shareholders are no longer needed and are at best tolerated. Still, even if you did expect this to happen, the announcement always triggers a short pause.

In March, OSRAM filed an application for the revocation of admission of the OSRAM shares to the listing sub-segment of the regulated market with additional obligations arising from the admission (Prime Standard). The intention is clear. By changing the listing sub-segment, post-listing obligations of the company such as certain reporting and publication requirements will fall away. By doing so, OSRAM intends to avoid additional efforts from the listing and achieve cost-saving and streamlining effects. The unfortunate side-effect is that the shares will be listed on the regulated market (General Standard) only, effective three months after the publication of the withdrawal decision by the Frankfurt Stock Exchange.

This sounds like a plan, doesn´t it? But the Bavarian coziness is not the style of ams AG, who informed the Managing Board of OSRAM at the beginning of May about an even better idea. ams decided to cause OSRAM to implement a delisting and to issue a delisting tender offer to the OSRAM shareholders. This is good news for shareholders looking for cash. Following the approval by BaFin, ams announced its delisting offer for the outstanding approx. 28% shares in OSRAM Licht on 21 May 2021. During the offer period, which ended on 18 June 201, shareholders could sell shares at 52.30 EUR per share. At the end of the acceptance period, 6,935,319 OSRAM shares had been tendered, corresponding to approx. 7.2% of the total capital.

CANCOM SE: Brexit gives People new Ideas

Standstill is certainly not the quality that comes to mind when you think of CANCOM. This assessment also applies to an ad hoc release published in May. The company informed that its Executive Board is reviewing strategic options regarding the business activities in the United Kingdom and Ireland. The review also includes the possibility of selling all company shares in CANCOM Ltd. This entity is the intermediate holding in which all CANCOM SE´s shareholdings based in the United Kingdom and Ireland are bundled. In the event of a sale, CANCOM will thus no longer have any business activities in these markets. In this context, CANCOM is also currently conducting a structured bidding process to determine investor interest in a takeover and an achievable purchase price.

The main bases for the review are an assessment of the risk-reward profile of the business activities in these markets, investor interest and the prospect of a high accounting profit, as well as strategic considerations about the future geographic core markets of the CANCOM Group. In FY 2020, CANCOM Ltd. and its affiliated companies in the United Kingdom and Ireland generated revenues of approx. 138 million EUR and an EBITDA of 19.7 million EUR.

HELLA GmbH & Co. KGaA: Who wants to put the company in the Shopping Basket?

The half-hearted IPO with KGaA shares indicates that HELLA did not really feel comfortable on the stock exchange. It is therefore no surprise that the search for a longer-term solution began soon afterwards. In April this year, the time had come. The Manager-Magazin reported, that the families that control the share capital of HELLA are considering selling their 60% stake in the equity of the auto parts maker. According to the report, the family has asked investment bank Rothschild to approach potential buyers.

The report did not provide the contact details of the banker in charge of this business. That wasn´t necessary either, because in any case the message sounded like a wake-up call. And in fact, several interested parties have apparently come together to consider this opportunity, including Knorr Bremse AG. The company confirmed its general interest in acquiring the block of shares amounting to 60% of the shares in HELLA GmbH & Co. KGaA held by the founding family some weeks later.  The family members must have been delighted. But just a few days later the bad news followed. The Executive Board of Knorr-Bremse did not see enough potential from the transfer of key-technologies and products to justify a transaction.

Let´s hope that there are other interested parties left in this race.