Audi headquarters in Ingolstadt
Düsseldorf Every beginning is difficult. Audi is the first brand from the Volkswagen groupwho tried a virtual general meeting. At least in the beginning Audi not really successful this Friday: The Ingolstadt premium brand has technical problems with the transmission over the Internet. The virtual shareholder meeting could therefore only start ten minutes late. VW boss Herbert Diess, at Audi the chairman of the supervisory board and thus the conference leader, had to apologize for the delay.
From the CEO’s point of view, the small technical lapsus should not be transferred to Audi cars. Rather, this sets high hopes for the new Audi boss: Markus Duesmann has only been there for four months, Diess had him himself BMW poached.
“Markus Duesmann will re-establish Audi’s claim of being ahead through technology”, Diess praised his new board colleague. He was confident that Duesmann would meet the expectations placed on him. Audi has had tough years. The diesel scandal in particular had badly affected the VW subsidiary.
It is a very special general meeting for Audi: it was the last. Volkswagen had already announced in February that it would take the daughter off the stock exchange. With 99.64 percent of the shares, the Wolfsburg group is the clearly dominant shareholder. The few free shareholders are to be squeezed out of the company. Just over 150,000 of 43 million shares are held by free shareholders, mostly former Audi employees. The legal form as a stock corporation should be maintained.
Volkswagen was able to enforce the squeeze-out resolution at the Annual General Meeting with its dominant majority without any problems. However, the Wolfsburg-based company could not be sure of their cause. Mostly there are still quarrelsome shareholders who take legal action against such a resolution.
The few free shareholders will be sweetened by Audi. Volkswagen wants to pay them 1,551 euros per share. In total, the VW group can withdraw about 250 million euros. Compensation is 90 percent higher than the average price before the legally relevant three-month period before the squeeze-out was announced.
Reporting obligations and legal risks are eliminated
The basis is the valuation report by the auditing company PwC, which Audi attests to a value of around 66 billion euros. The VW group was itself a little surprised by how high the Ingolstadt premium subsidiary was rated, which makes the squeeze-out comparatively expensive. “The evaluation brought tears to our eyes,” said a senior VW manager.
At the truck subsidiary MAN the game will repeat itself: Volkswagen wants to pay out the few free shareholders there and take over the company entirely itself.
Volkswagen sees the squeeze-out as an important step for the further development of Audi. “We want to use it to create leaner structures,” said brand boss Duesmann, explaining the decision. If Audi was no longer listed on the stock exchange, there were no special reporting obligations and legal risks. Cooperation at group level will also be facilitated. “We want to exploit further synergies,” emphasized the new Audi boss. “We now have the opportunity to break new ground and prove our lead again,” he added.
The Audi future is electric
A new Audi E-Tron in Great Britain: Like all other Volkswagen Group brands, Audi wants to score points with electric cars in the future.
(Photo: Getty Images)
The economic situation of the VW subsidiary has not become easier due to the corona crisis. Compared to the previous year, Audi lost about a fifth of its vehicle sales in the first six months. The pandemic gave him an unusual start in April as head of Audi, Duesmann said. “It has been four very special months for me so far.”
The premium subsidiary Audi, which has a billion-dollar surplus in the normal half-year, slipped into the red from January to June due to the pandemic. The operating minus is 643 million euros. Special charges of around 100 million euros from the diesel affair are not yet included. Production stoppages and closed dealerships have turned a company, which is usually profitable, into a loss-maker.
Convinced of the turnaround in the second half of the year
“We are experiencing an unprecedented time,” said Audi CFO Arno Antlitz. Despite the first positive signals during the past few weeks, 2020 remains “extremely challenging”. In the meantime, a revival of demand has become noticeable in many important car markets.
Audi sold 707,000 vehicles in the first half of the year, a decline similar to that of its competitors Mercedes Benz and BMW have to cope. In China, demand dropped by three percent, in Europe by 37 percent. “But the current situation seems to be stabilizing,” said Antlitz.
All Audi plants have been working again since the end of June, and the VW subsidiary plans to start in September Remove short-time work at their German locations. Against this background, brand boss Duesmann announced at the annual general meeting that the turnaround would be achieved in the second half of the year and that it would be in the black again. For the year as a whole, the Management Board expects lower demand worldwide, significantly less sales and an operating result “significantly below the previous year”, but “clearly positive”, said Duesmann.
According to the current status, the corona crisis will not lead to Audi threatening further cuts in personnel. Duesmann said that the reduction of 9500 jobs at the two main German plants in Ingolstadt and Neckarsulm had already been decided in November and thus before the outbreak of the corona pandemic. “I am convinced that this is sufficient for us. Nothing else is planned, ”emphasized the new Audi boss.
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