Following approval by the German Federal Financial Supervisory Authority (BaFin), Schaeffler AG (Schaeffler) has published the offer document for the voluntary public tender offer (tender offer) for all outstanding shares in Vitesco Technologies Group AG (Vitesco).
Vitesco shareholders can accept the offer and tender their shares to Schaeffler for a cash consideration in the amount of EUR 91 per share, which represents an attractive premium of around 20% on the 3-month volume weighted average share price up to and including October 6, 2023 i.e. the last trading day prior to the announcement of the offer.
Alternatively, Vitesco shareholders have the opportunity to benefit from the expected significant synergies and value creation potential by retaining their shares until the proposed merger with Schaeffler, when Vitesco shares will be exchanged for newly issued Schaeffler shares.
The acceptance period ends on December 15, 2023. The offer is not subject to a minimum acceptance threshold. There will be no additional acceptance period and a prolongation of the acceptance period is not envisaged.
Closing of the tender offer is subject to customary closing conditions and certain regulatory approvals that are set out in the offer document. Subject to the fulfilment of these conditions, Schaeffler expects the tender offer to be closed in early January 2024.
Vitesco shareholders will be notified about the offer in writing by their custodian bank or other securities service companies where their Vitesco shares are held.
Shareholders should inquire with their custodian banks about any technical questions regarding acceptance of the offer and be aware of any deadlines set by their banks that may require action prior to the aforementioned end of the acceptance period on December 15, 2023. To accept the offer, shareholders must submit a written declaration to their custodian bank or securities service company. The offer document can be requested free of charge from the settlement agent and is also available on the following website along with further information about the tender offer.
The tender offer is the first step of a three-step overall transaction leading to a merger of Vitesco into Schaeffler and creating a leading Motion Technology Company. The combined business will have four focused “pure-play” divisions generating significant strategic advantages. This includes a combined division E-Mobility with significant growth potential.
Especially in the fields of electrification, Schaeffler and Vitesco have highly complementary technology portfolios, allowing the company to offer best-in-class solutions across all dimensions after the merger, leveraging the accelerating growth opportunities in e-mobility. In the Powertrain & Chassis Division, Schaeffler and Vitesco will also be able to optimize profitability in conventional powertrain technologies, which will retain an attractive margin and cash profile.
The profits from this business are to be channelled primarily into the growth areas of e-mobility and chassis. The merger will also strengthen the highly profitable automotive aftermarket business, which will form the third division as Vehicle Lifetime Solutions. And finally, the fourth division, Bearings & Industrial Solutions, which will combine the bearings business from the industrial and automotive segments, not least to achieve better comparability with global competitors from a capital markets perspective. The combination will make Schaeffler and Vitesco stronger together and is beneficial for customers, employees, shareholders, and business partners.
Following the end of the acceptance period, Schaeffler’s Executive Board intends to convene an extraordinary shareholders’ meeting and a separate meeting of the non-voting shareholders as the second step of the overall transaction, at which the conversion of Schaeffler’s non-voting shares into common shares with full voting rights at a ratio of 1:1 is to be resolved. The effectiveness of this unification of share classes is subject to the completion of the merger as the third step of the planned overall transaction.
The outlined transaction steps are to be structured in a way that at the time of the completion of the merger, the stock of Schaeffler will consist solely of voting common shares and that Vitesco shareholders, who retain their shares until the planned merger, will receive voting common shares of Schaeffler in return. The related merger requires the approval of the respective annual general meetings of both companies. The merger ratio of Vitesco shares into Schaeffler shares for Vitesco shareholders in the merger will be determined by both companies on the basis of a valuation conducted by an independent valuation expert and confirmed by a court-appointed merger auditor. The completion of the overall transaction is expected to take place in the fourth quarter of 2024.
“We are firmly convinced that the merger of Schaeffler and Vitesco will create value for the shareholders of both companies, enable us to offer our customers an even better range of products and services, and provide our employees with exciting and sustainable jobs. This is especially true in e-mobility, where we are creating a global champion. Both companies are stronger together,” Klaus Rosenfeld, CEO of Schaeffler AG, said.
