VIPsight - April 2010

 

COMPANIES

 

Telekom adopts a female quota

By the end of 2015 30% of middle and senior management posts in Deutsche Telekom worldwide are to be occupied by women, the board of Germany’s biggest telecommunications group decided in March. Currently, the 60 top managers include only two women. There are none on the board, and on the supervisory board there are only three women, as representatives of the employee side. In middle and lower management, the female proportion is currently 16%, while 32% of employees are female. The firm’s boss René Obermann calls the voluntary female quota “not some dictate of misunderstood equalization, but a solid necessity.” The group was thus also responding to the failure of years of measures to date to promote women, which were honourable and well meant, but unfortunately remained unsuccessful, admitted personnel director Thomas Sattelberger. In order to reach the binding quota group-wide in future, for new appointments of graduates, in selection processes, talent pools and management development programs at least 30% of applicants will have to be female. The quota is flanked by programmes to make family and job compatible. The range of job accompaniments is to be extended to parental time models, part-time models for management, flexible-hours models and child-care possibilities. By the binding quota, the DAX firm is responding to the threatening fight for scarce talent in an ageing society and seeking to stop up the specialist gap. The German economic research institute (DIW) finds that the female proportion in the top storey in Germany currently reaches a bare 2.5%.

 

Qatar wants a second seat on the VW supervisory board

Last year the Emirate of Qatar came to the aid of Stuttgart luxury carmaker Porsche when it was threatened with collapse because of over-indebtedness in consequence of a failed attempt to take over Volkswagen. The Arabs took a share in Porsche Finance Holding and took over most of the options for VW shares. As a counterpart the investor was promised a second seat on the VW supervisory board. The business newspaper “Das Handelsblatt” reports from VW supervisory board circles that the Emirate is now demanding this second seat. The Lower Saxon state government confirmed this move to Handelsblatt. At VW’s AGM on 22 April, initially Hussain Ali Al-Abdulla, manager of the Qatar holding company, will replace Roland Oetker on the supervisory board. Behind the scenes, speculations are now about who will have to vacate a seat for the second Qatar appointee. In particular, the two owning families Porsche and Piёch each fear being in a weaker position than the other clan if one of their people has to step down. The two families are therefore pushing for one of the independent members such as RWE manager Jürgen Großmann, ex-E.On manager Hans Michael Gaul or TUI CEO Michael Frenzel to go. In the new set-up the two clans hold up to 35% of the shares. The VW Act gives Lower Saxony two supervisory board seats.

 

Bilfinger Berger becomes an SE

On the agenda for the annual general meeting of construction group Bilfinger Berger on 15 April, alongside such points as a share buyback is the conversion of the company into a Societas Europaea (SE). By autumn the MDAX firm will according to its timetable have taken this new form. At the same time the supervisory board is being reduced from its present 20 members to 12. Financial Times Deutschland (FTD) names Hans Bauer, Horst Dietz and Rudolf Rupprecht as possible candidates to vacate their places at the boardroom table.

In the meantime, the Mannheim construction giant has, against the background of accusations that the group had done shoddy work building the underground railways in Cologne and Düsseldorf and on other projects, set up two expert panels. The first group is to take a look at quality management within the group. The second will study current and completed specialized underground constructions with similar bearing structures to those used in the Cologne and Düsseldorf undergrounds. Both expert panels will report to technical director Prof. Hans Helmut Schetter. “Depending on the results, we will take measures to keep our quality guarantees in future above any doubt again,” says CEO Herbert Bodner. Even though the question of guilt for the collapse of the Cologne City Archives has not yet been fully cleared up, Bodner stressed that any financial repercussions were under control. The group was well insured, said the CEO of Germany’s second biggest construction group. Nor had the accusations affected the balance sheet for the past year. Even the final result for 2010 would not be lastingly affected by retroactive improvements and possible construction delays, Bodner promised.

 

EADS loses major order

European aerospace group EADS is being squeezed at several points at once. First, there are the disputes over the A400M cargo plane. While this military aircraft is to be built, the Airbus military division (AMSL) is currently in a clinch with the Europrop International (EPI) consortium, which is to build the Western world’s most powerful propeller propulsion unit. The two parties are accusing each other of delaying the project, and making damage claims: AMSL for €500 million and EPI for some €425 million. Complicating all this is the fact that EADS subsidiary Airbus was unable to succeed with the US military in the tender for the supply of tanker aircraft. Because of political pressure, the bidding period for the 35-billion-dollar order is being extended, but the documentation required for it under US competition law can hardly be produced in good time. Additionally, Italian tax authorities are currently looking into whether the EADS space subsidiary Astrium in Italy has to pay arrears of tax. Italian public prosecutors decided in late 2009 to start proceedings for attempted fraud and failure to submit a tax declaration. Neither the date nor the amount of the claim are known.

In the meantime, the loss position is also having its effect on shareholders. In 2009 EADS registered net losses of €763 million. Shareholders are to get no dividend this year.

 

Metro clears the decks

The wholesale and department-store group Metro is splitting up its core business, the wholesale division Cash & Carry. In future the segment will be divided between two business units: Europe/MENA (Middle East and North Africa) on the one hand, and Asia/New Markets on the other. Management and administrative functions of the group holding company Metro AG and of Metro Cash & Carry are also to be largely integrated, thus considerably simplifying management organization. This will probably mean lost administrative jobs. The new structure is intended in particular to take advantage of growth opportunities in Asia and Russia and improve the flagging German business. In the course of group restructuring, the DAX group could hive off its department store subsidiary Kaufhof and in the medium term also get rid of grocery division Real, say industry observers, according to Financial Times Germany (FTD). In the medium term the result before special factors is expected to grow by at least 10% a year.

 

Deutsche Post loses its tax privilege

On 5 March the Bundestag removed Deutsche Post’s turnover-tax privilege as from 1 July. In future the Post as universal service provider as a letter carrier for commercial customers will, like its competitors, be subject to VAT. Service to private customers can continue to be offered tax free. The former monopolist’s CEO Frank Appel objected to removing the privilege, saying the draft law was in contradiction with EU law, which says countrywide letter services for private and business customers are in general to be VAT exempt. He said nothing about possible legal steps.

 

Adidas in future to issue personal shares

Adidas is to resolve at the AGM on 6 May to convert shares in the sports goods producer from bearer to personal shares. “It will be easier to find out who our shareholders are and to keep in touch with them,” says Financial Times Deutschland (FTD), citing an Adidas spokeswoman. Currently the proportion of non-localized shareholdings at Adidas is around 29%. Around half the DAX firms now have personal shares. In 2009 Bayer and in 2008 E.On shifted to this type of share.

HeidelCement wants onto the DAX

At latest by autumn 2010, the Heidelberg building-materials giant wants to come into the DAX. This was announced by CFO Lorenz Näger while presenting the latest figures for 2009. Dispersed holdings in the MDAX company had grown, and with it the interest of investors and analysts, the company indicated. In terms of dispersed holdings and market capitalization, HeidelCement, he said, already met the criteria for being in the DAX. By the end of May the exchange-turnover hurdle should be passed.

 

New company has MDAX chances

Kabel Deutschland AG, hived off from Deutsche Telekom in 2003, was the biggest IPO of a company in Germany for two years. The firm, listed in Prime Standard for the first time on 22 March, runs cable networks and offers services in the areas of television and telecommunications. In its IPO, the selling shareholder, Cable Holding SA, started by offering 45 million units, with a further 6.75 million as an additional allotment. The offer was then cut to 30 million units with a further 4.5 million as a greenshoe (over-allotment option). The shares were offered in a price range of €21.50 – €25.50, and the issue price then set at €22.00. Kabel Deutschland is regarded as a candidate for the MDAX in the medium term.

 

Singulus joins the TECDAX

At the regular review of the indexes, bioanalytics group Rofin Sinar had to give way to optical storage medium maker Singulus Technologies in the technology index. The change is effective from 22 March 2010. There were no changes in the DAX or MDAX.

 

Salzgitter takes over Klöckner-Werke

In March 2007 Salzgitter came into Klöckner-Werke, taking 85%. This has since risen to 95.78%, enough to allow a squeeze-out at the filling and packaging technology group. The majority shareholder is offering the requisite minimum of €14.33 per share certificate. The general meeting, which still has to formally vote on the squeeze-out, is likely to be held in August.

 

Squeeze-out by Munich Re

In May, shareholders of the ERGO insurance group are to decide on the squeeze-out by Münchener Rückversicherungs-Gesellschaft (Munich Re). Munich Re set the cash payment at €97.72 on 2 March. The shareholder vote is scheduled for 12 May.

 

Wirecard like a yo-yo

Because of mysterious information, the Wirecard share collapsed for a while by over 30% and its exchange value fell, according to the FTD, “by some 240 million euros”. What started this off was a report by information service Gomopa on the convolutions on a money-laundering scandal in Florida. Additionally, according to a report in the Süddeutsche Zeitung, there is a criminal information before Munich public prosecutors saying that unlawful money transfers were processed through the Wirecard bank. The Handelsblatt then did some research and found that the report in a local Florida newspaper cited as a source by Gomopa did not exist; the on-line service had also, on request, deleted the reference to the local paper. Additionally, the reporter in Florida admitted on inquiry that Wirecard was not mentioned in the report. The anonymous denunciation received by Munich public prosecutors would certainly be looked into, but so far no investigations had been begun. Handelsblatt cites one analyst as saying that the Wirecard share had been “manipulated for weeks”. “Short-sellers were playing at yo-yo with the Wirecard share“. Wirecard itself rejects the accusations and has hired a law firm.