Capital News
Deutsche Börse AG: Concrete negotiations with Refinitiv concerning the potential purchase of certain FX business units
Following current market speculations, Deutsche Börse confirmed that it is currently in concrete negotiations with Refinitiv group concerning the potential purchase of certain FX business units. The negotiations and assessments of a potential transaction are ongoing. However, the company added that the purchase price of 3.5 billion USD and the imminent signing of binding contracts mentioned in some market speculations are entirely unfounded.
RWE AG: Option to purchase RWE`s stake in Czech grid operator exercised
In mid-February, RWE acquired a majority holding in the Czech distribution system operator Innogy Grid Holding (IGH) form innogy SE. An agreement had been reached as part of the transaction with E.ON that E.ON would purchase this interest in IGH from RWE within the scope of the envisaged acquisition of Innogy SE.
The execution of the agreement with E.ON triggered a right of first refusal for the co-shareholders in IGH, i.e. the Macquarie Infrastructure and Real Assets /MIRA) managed consortium of investors, which has been exercised. Therefore, the MIRA managed consortium will acquire the stake under the terms and conditions applicable if RWE sold it to a third party, which would be E.ON in the present case.
Completion is subject to merger control proceedings and the transfer of RWE´s stake in Innogy to E.ON. The purchase price is approx. 1.8 bn Euro.
Deutsche Bank AG: Merger Plan B
According to the Financial Times, the asset management arm of Deutsche Bank, DWS Group GmbH & Co. KGaA, and UBS are in so-called “serious” merger talks.
According to the newspaper, the talks have been going on for several months. If the deal were to materialize, the combined business is expected to have assets of approx. 1.4 trillion Euro under management. In an earlier report, Bloomberg already indicated that UBS was evaluating options for its asset management business, including a partial sale or merger.
Merck KGaA: Delivered a “Superior Proposal” for Versum
In February, Merck commenced a cash Tender Offer to acquire all outstanding shares of Versum Materials, Inc. (NYSE: VSM) for $48 per share. Two months later, the initiative resulted in a definitive agreement to acquire Versum for $53 per share in cash.
The agreed-upon price reflects an enterprise value (EV) for Versum of approximately €5.8 bn Euro, implying an EV/2019 EBITDA multiple of approximately 13.7x based upon consensus estimates and a pro forma multiple of 11.6x including 75m Euro of identified annual run-rate cost synergies.
Versum’s Board of Directors has unanimously determined that this business combination constitutes a “Superior Proposal” as defined in Versum’s previously announced merger agreement with Entegris, Inc., and Versum has terminated the merger agreement with Entegris concurrently with the execution of the definitive agreement with Merck.
The transaction is expected to close in the second half of 2019, subject to the approval of Versum stockholders at a Versum special meeting, regulatory clearances and the satisfaction of other customary closing conditions.
Steinhoff International Holdings N.V.: Impairment of Goodwill and Intangible Assets
Just in time for the planned release of its audited financial statements for 2017 and 2018, Steinhoff informed on April 30th that it undertook a review of the carrying value of the Group´s goodwill and intangible assets. While the value of these assets was disclosed as being approximately 9 bn Euro as at September 2017 in the Group´s interim statement for the period ending March 31st, 2018, it now has been determined that the goodwill and intangible assets are to be further impaired by approximately 1.8 bn Euro to approximately 7.2 bn Euro. The amendment will feature in the 2017 Group financial statement, the audit of which is currently in progress. The publication of this statement is scheduled for May 7th, 2019.
This conclusion follows a reassessment of the value of the goodwill and intangible assets of Mattress Firm Inc. as at September 2017 which included consideration of the pre-Chapter 11 trading performance.
CECONOMY AG: Reorganization and Efficiency Program
The Management Board and Supervisory Board of CECONOMY AG as well as the Management Board and Advisory Board of Media-Saturn-Holding GmbH, a majority shareholding of CECONOMY, approved a reorganization and efficiency program, which aims at streamlining the group's processes, structures, and business activities and reducing costs. The optimization and restructuring particularly focus on central functions and administrative units in Germany. The program also includes reviewing the business activities of smaller portfolio companies. As a result of the program, CECONOMY expects expenses of around 150 – 170 m Euro in financial year 2018/19 and additional approx. 20m Euro of non-cash expenses, which relate to the write-down of assets due to portfolio measures. The expenses related to changes on the top management level of 34m Euro were already booked in the first quarter of 2018/19 and are not included in the aforementioned costs of the reorganization and efficiency program.
The expected sustainable annual savings run-rate form the implementation of the program amount to 110 – 130 m Euro.
Delticom AG: KPMG needs more Time
Delticom AG informed that the preparation of its annual financial statements and consolidated financial statements as of December 31, 2018, continues to be delayed and will not be completed by the end of April. Accordingly, the finalization of KPMG's audit of the financial statements will also be postponed. As soon as it has been determined when the financial statements will be prepared and audited and approved by the Supervisory Board, Delticom will set and announce a date for the publication of the Annual Report and the Annual General Meeting.
In a prior release, the company stated in March that in the course of the preparation and audit of the financial statements, it became apparent that Delticom and KPMG were too optimistic with regard to the time required for such work.