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VIPsight

Corporate Governance – portrayed in the individual cultural and legal framework, from the standpoint of equity capital.

VIPsight is a dynamic photo archive, sorted by nations and dates, by and for those interested in CG from all over the world.

VIPsight offers, every month:
transparent and independent current information / comments / facts and figures on corporate governance locally and internationally,

  • written by local CG experts,
  • selected and structured by the Club of Florence,
  • financed by its initiator VIP and other sponsors with a background of “Equity and Advisory” interests.
     

VIPsight International


Article Index

VIPsight - 2nd Quarter 2019

 

COMPANIES

 

BMW AG: One Billion Arguments

With respect to the EU antitrust proceedings, BMW will recognize a provision. This decision followed the information by the European Commission about a “Statement of objections”. The Commission is investigating whether German car manufacturers cooperated in technical working groups to restrict competition in development and rollout of emission reduction technologies.

BMW decided to contest the Commission´s allegations with all legal means if necessary. However, the statement leads BMW to believe that it is probable that the Commission will issue a significant fine. According to IFRS, this results in an obligation to recognize a provision. Therefore, following its review of the Statement of Objections, BMW will recognize a provision, which is likely to exceed 1 bn Euro. This effect will negatively impact the financial results in the first quarter of 2019.

 

Wirecard AG: External Investigations reveals no material impact on financial reports of Wirecard

In light of allegations by a whistleblower in Singapore and severe accusations and speculations in certain press magazines and publications, Wirecard mandated the law firm Rajah & Tann Singapore LL.P. to undertake an independent investigation into allegations relating to certain transactions and corporate governance issues of Wirecard subsidiaries in Asia.

The review did not identify inaccuracies with material impact on the financial reports of Wirecard Group. Revenue of 2.5m Euro was wrongfully recorded in 2017 which will be restated in the 2018 annual accounts and is compensated by positive restatements identified for the year 2017. Furthermore, an asset of 3m Euro was wrongfully recorded for one week in 2018 and will not be reflected in the 2018 annual accounts. In addition, draft contracts were prepared and signed on behalf of certain subsidiaries, and not fully executed. These events occurred in respect of agreements which may appear to not have underlying genuine transactions. Save for one transaction of approx. 63K Euro, none of the draft transactions were entered into respective ledgers nor did funds flow into or out of Wirecard group companies.

 

Commerzbank / Deutsche Bank: There goes the Politicians Dream

After careful analysis, the Management Boards of Commerzbank and Deutsche Bank have concluded that a combination of the banks would not have created sufficient benefits to offset the additional execution risks, restructuring costs and capital requirements associated with such a large-scale integration. As a result, the two banks have decided to discontinue discussions.

According to prior publications, it took the boards several weeks to get to this conclusion.

 

ThyssenKrupp: Is Time the Limiting Factor?

The European Commission informed that it extended the deadline for reviewing the planned joint venture deal between ThyssenKrupp and Tata Steel until June 17th, 2019.

Meanwhile, market speculations regarding the assets to be disposed in order to win antitrust approval focused on plants and activities in Belgium, the U.K., Spain.

 

Uniper SE: And here comes the next one…

KVIP International V L.P. requested to amend the agenda of Uniper´s AGM by adding the following item:

The Board of Management is instructed to prepare and submit to the General Meeting for resolution, as soon as possible and the latest by the date of the next AGM of the company, draft agreements and corresponding reports for the legally valid spin-off of the international power business segment for absorption into a newly formed or already existing separate legal entity selected in accordance with the duties of the Board of Management. The Board of Management is instructed to satisfy all necessary prerequisites for the implementation of the aforementioned spin-off at its reasonable discretion in accordance with this resolution.

In case that this resolution is not adopted by the required majority, KVIP proposed an alternative resolution concerning the spin-off of the operations in Sweden.

Uniper´s AGM will be held on May 22nd, 2019.