VIPsight - April 2011

COMPANIES

 

Quandt pledges BMW shares

As emerged just last month, BMW heir Stefan Quandt in 2009 pledged his 17.4 percent stake in BMW, Stefan Quandt GmbH & Co. KG für Automobilwerte, to keep his loss-making investment firm Delton alive through a loan of 200 million euros. In 2002, the Delton holding company still held five participations. Since, the portfolio has shrunk to two companies, homeopathic-medicines supplier Heel and logistics firm Logwin. Together with his mother and sister, Stefan Quandt holds 46.7 percent of carmaker BMW. His sister, Sabine Klatten, is far more successful with her holding company Skion: it is involved in carbon specialists SGL Carbon and wind-turbine manufacturer Nordex.

 

Commerzbank plans capital increase

Already at the presentation of the financial statement for 2010 in February, Commerzbank CEO Martin Blessing had announced its intention to pay back at least ten percent of the federal government’s silent partnership by 2011. The Frankfurt bank had received a total of 18.2 billion euros in support from the federal government in the wake of the financial crisis, 16.4 billion euros of it as a silent contribution. Now the institution reportedly plans a capital increase, to be initiated at the shareholders' meeting on 18 May. The corporate action could be carried out by the end of the second quarter, in the course of which, according to Financial Times Deutschland, five to seven billion euros that could be invested in the repayment of the federal aid are to be raised. Thanks to book profits as a result of the repurchase of its own bonds in January, the bank was able to end the first quarter with a billion-euro profit. Meanwhile, Commerzbank has announced that Deutsche Schiffsbank, a leading global provider of ship finance, will be merged into Commerzbank. Commerzbank currently holds 92 percent of the Hamburg institution, in which the credit portfolios of Deutsche Schiffsbank, Dresdner Bank and Commerzbank have been combined. Discussions with the co-owner UniCredit are in hand.

 

Schaeffler dares partial exit

At the end of March, the Schaeffler family firm managed a partial retreat. The Bavarian roller-bearing manufacturer, which in 2009 still wanted to take over the Hanover automotive supplier Continental, got rid of 29.7 million Continental shares, thus raising 1.8 billion euros. Goldman Sachs had placed the papers on 28 March at €60. With this money the family empire lowered the debts of the family holding by €2.8 billion to €4.6 billion, thus improving the terms for other ongoing bank loans. As a result of the partial withdrawal, the free float at Continental rose from 24.9 percent to 39.7 percent. Chances are good that the currently MDAX-listed tire maker will again be included in the DAX. Through the transaction, the Schaeffler stake in Conti declined from 75.1 to 60 percent. The actual merger of both companies planned for 2011 is still on ice.

 

Telekom sells U.S. business

By 2012 at the latest, Deutsche Telekom’s U.S. commitment will end, according to the schedule for the sale of its U.S. business recently agreed with AT&T. Germany's largest telecommunications provider will receive 39 billion U.S. dollars for T-Mobile USA, 25 billion U.S. dollars of it in cash and 14 billion dollars in shares of the buyer AT&T. The Bonn-based company will thereafter hold eight percent of the U.S. provider and get a seat on the AT&T Board. Deutsche Telekom shareholders will benefit through a share buyback programme of up to five billion euros and a guaranteed minimum dividend in the years 2010 to 2012 of 70 cents, or 3.4 billion euros annually. Around thirteen billion euros will flow into reducing debt. Deutsche Telekom had bought the mobile operator Voicestream in 2000 for €39 billion and later renamed it T-Mobile USA. Both the U.S. Department of Justice and the regulator (FCC) must yet approve the deal.

 

Quarrels at Douglas

Since drugstore chain Müller came into retail group Douglas at 10.06 percent, the Hagen company is buzzing with rumours. As Financial Times Deutschland reported, Ernst Schröder, chief financial officer at Douglas major shareholder Oetker, had criticized Douglas CEO Henning Kreke at a supervisory-board meeting at the end of February for his defence strategy against Müller as weak on enforcement. Henning Kreke himself had commented on the Müller participation with the words, “Müller doesn’t fit between Oetker and Kreke.” Now, Henning Kreke’s father, supervisory board chair Jörn Kreke, has signalled co-owner Oetker he wants to get more actively involved in daily business again in future. Oetker holds a 25.81 percent stake in Douglas, and Henning and Jörn Kreke a further 12.14 percent.

 

EADS slows Daimler phase-out

German carmaker Daimler wants to run down its 15 percent stake in the aviation and aerospace group EADS to 7.5 percent, and is probably talking about it with the German government. The condition is that the fragile French-German balance within the group should be maintained. In March, EADS CEO Louis Gallois hinted, according to Financial Times Deutschland, that there would be no proposal for an acquisition programme of shares of major shareholders at the next AGM. This is a clear rejection by Gallois of any internal compromise solution. Regarding employees too, said Gallois, we need a solution that is sustainable and not just for a few years. The Frenchman prefers to invest the liquid assets of twelve billion euros in acquisitions, including in the U.S., so as to be more independent of the fluctuating Airbus results. The Daimler stake of 7.5 percent is currently worth around 1.23 billion euros. Parallel to the current disputes, the exposure portal Wikileaks reported that in 2005-2009 the U.S. government had regular information about the disputes within EADS. Inter alia, former British partner BAE was called schizophrenic after it left, and co-CEO Noel Forgeard described as an over-ambitious madman. This information leak is controversial also because the U.S. government and therefore competitor Boeing was supplied with valuable background information.

 

Gigaset in the TECDAX

With effect from 21 March, semiconductor industry supplier SüssMicrotec replaces automation specialists Manz Automation in the technology index TecDAX. Solar provider Conergy also falls out of the index. It is succeeded by Gigaset, the investment company in the telecommunications area. Gigaset emerged from the former Arques Industries, and made the jump to the TecDAX by categorizing as a technology company. In the MDAX and DAX, there were no changes.

 

MAN blocked

Commercial-vehicle manufacturer MAN had already postponed publication of its own annual report from the beginning to the end of March. Now, the general meeting has been reset from 8 April to 27 June, thus exhausting the legal leeway altogether. The background is still the conflict between the Munich lorrymaker and the Abu Dhabi state fund IPIC (International Petroleum Investment Company). The Arabs had acquired 70 percent of MAN subsidiary Ferrostaal in 2009 for €450 million. Since 2010, both parties have been negotiating the acquiring of the remaining 30 percent. The negotiations have been blocked through the involvement of Ferrostaal in the MAN bribery affair. The industrial-services provider is threatened with compensation payments of €200 million. IPIC does not want to be made liable for this and is now demanding compensation from MAN for the threat of fines, and a discount for the remaining shares. Meanwhile, the Fund has even filed an arbitration claim for reversal of the already acquired shares. MAN is now considering an arbitration defence. The explosive nature of the quarrel is enhanced by the fact that automaker Volkswagen wants to merge the two commercial vehicle manufacturers MAN and Scania as soon as possible. VW has 30 percent of MAN and 70 percent of Scania. The condition for the merger is, however, agreement between MAN and IPIC. Originally, the schedule was that Scania would submit a takeover bid to MAN in April, or at latest in May.

Hapag Lloyd postpones IPO

On 15 April, the world's fifth-largest shipping company Hapag Lloyd is to go public. After the earthquake in Japan and the war against Gaddafi the stock plans have been postponed to late May. The former parent, tourism group TUI, got rid of a share package of 11.3 percent in advance and sold it for 315 million euros to the logistics company Kuehne + Nagel, part of the Hapag-Lloyd consortium Albert Ballin, which will in future hold 25 percent of Hapag. TUI has been looking for quite some time for ways out of the shipping business, so as to focus on the tourism business. In addition to an exit via an IPO, the Hanover people are also considering selling their stake, currently 38.4 percent. In the medium term TUI wants to hold only up to ten percent of the shipping-company subsidiary.

 

VW annoys BMW

Volkswagen came into SGL Cin late February as the second-largest shareholder at 8.18 percent. BMW co-owner Susanne Klatten holds 22 percent through Skion, and was more than peeved at the advance by Piëch. She indicated she would if necessary expand her share to over 25 percent and thus secure a blocking minority. VW initially suggested the group did not aspire to a Supervisory Board seat. The company itself has welcomed the commitment by Wolfsburg. In a joint venture with BMW, SGL Carbon has since 2009 been developing carbon fibres for electric cars.

 

Is Tognum getting more expensive?

The planned incorporation of Tognum could be more expensive for Daimler and Rolls-Royce than expected. The automaker and the British turbine manufacturer are offering shareholders of the diesel-engine manufacturer a purchase price of €24 per share, so that the bid volume would according to the two companies amount to about 3.2 billion euros. But the bid does not meet the expectations of the Tognum management involved. Based on the weighted average share price during the past three months, the calculated surcharge according to the Börsenzeitung is about 22 percent. The offer must also be approved by the Federal Financial Supervisory Authority (BaFin) before it is officially announced.

 

 

 

Buhlmann's Corner

The guilty don’t need to be looked for ...

They are found by themselves. In her policy statement, the German Chancellor had, with her coalition partners, listed “planning for nuclear security”, and the economy minister wanted to survive the next 14 days. Werner Schnappauf’s signature on it was to prove a political disaster for him – he resigned as managing director of the Federation of German Industries.

Shortly after scourging investors’ quarterly thinking as one of the causes of the financial crisis, or better crisis of confidence, the same Federal Government proposes a 90-day moratorium on nuclear energy. The quarterly thinking was rightly questioned, and then perpetuated with long-term incentives. The bonus without liability was one of the causes of the financial and confidence crisis – and it is just this bonus that the German voters have denied the black-yellow government in recent state and local elections. Those who, after decades of substantive discussion, need a 90-day moratorium and operate a decree policy without legal certainty should leave the ground free for better people – instead of abstaining in UN resolutions.

The RWE shareholders should follow the same line and take a clear standpoint at the next AGM: say yes or no to the counter-motions regarding disproportion and conflicts of interest in the selection of future supervisory-board members. The need is to send a stable supervisory board supported by a large majority into the difficult negotiations over a future for RWE.

You cannot, for historical reasons, elect municipal governments to the supervisory board, and then let at least as strong a group, non-German institutional shareholders, be represented very meagerly by a former politician from Austria. The shareholders should force the entire board, and especially the Nomination Committee, to put together a new RWE supervisory board. Nor is it enough to make eyes at quotas for women; the focus should be primarily on internationality and on the shareholder groups (including, but not primarily, in gender-specific terms) to send into the supervision of the company.

Fortunately, all the agencies producing voting recommendations have given the same advice. Now it remains to be seen what voices on the platforms of voting investors can make it to the AGM quorum. All those who don’t ask for a voting receipt are acting carelessly to negligently.

Only the vote arriving safely in the ballot box at the general meeting is practical corporate governance!

 

 

 

ACTIONS CORNER

A court in Arkansas has ordered Bayer, after years of controversy over GM maize, to pay 136.8 million U.S. dollars. The U.S. jury ruled that Bayer CropScience must pay Riceland Foods 11.8 million U.S. dollars in compensation. The pharmaceutical and chemical company regards especially the punitive damage payment contained in the penalty, which can be imposed for particularly reckless behaviour, in the amount of 125 million U.S. dollars as “completely unjustified”. The producer of plant protection products and seed is still examining its legal options.

Six former and current employees accuse a Bayer subsidiary in the USA, in an application filed on 21 March in federal court in New Jersey, of systematically disadvantaging them in pay and promotion and also of putting mothers and pregnant women under pressure. In addition, women were characterized as “sneaky” and “indecisive”, reports the Süddeutsche Zeitung. The female employees of Bayer Healthcare Pharmaceuticals are calling for 100 million U.S. dollars. The pharmaceutical company has rejected the accusations and announced it will defend itself against them.

The Commerzbank has failed before the London Court of Appeal in its application to have summary proceedings by more than 100 former bankers at Dresdner Kleinwort dismissed. There will now be a lawsuit in which the investment bankers will sue the former Dresdner Kleinwort for bonuses of €50 million. The court in London ruled on 8 March that the bankers may use written commitments from before 19 December 2008, when they received a letter on bonuses to the employees of the investment bank. Because of the 2008 financial crisis the bank had suffered losses of 6.5 billion euros.

On 9 March Deutsche Bank premises in South Korea were apparently searched by public prosecutors. The Bank is cooperating with the prosecutors in the investigation into the causes of the stock-market crash of 11 November 2010, which wiped out 26 billion dollars in stock-market value. The Seoul stock market had local brokerage subsidiary DSK excluded from proprietary trading in equities and derivatives in February for six months, over unfair trade practices. Germany's largest bank now expects losses of approximately ten million dollars because of its half-year exclusion. Five people are still under investigation.

Before the Federal Court, the Deutsche Bank has suffered a bitter defeat in its dispute over so-called “interest-rate bets”. Germany's biggest bank is to take responsibility for the losses and pay damages in the amount of the €540,000 that Ille GmbH lost on risky interest-rate swap transactions mediated by the bank. In the Court’s view the Bank had breached its duty to provide advice and information to its Hessian corporate clients. It is the first time the highest court has ruled in the dispute on interest-rate swap risks between German municipalities plus medium-sized companies and the banks.

Rolf-Ernst Breuer has had to answer charges of attempted malicious use of process in the Deutsche Bank v. Leo Kirch case before the Munich Higher Regional Court. The criminal division took the prosecution charge to trial. Thus, for the first time in almost ten years, on 25 March the insolvent media manager and the ex-head of Deutsche Bank, whom Kirch holds responsible for the collapse of his empire, met again. The former media mogul accuses the Frankfurt bank of having brought about the insolvency of his group through a TV interview in 2002.

The Finance Committee of the City of Dresden will sue GAGFAH. The City Council was unanimously in favour of claiming penalty payments of up to €1.06 billion plus interest from the real-estate group. The major rental agency is alleged to have failed to comply with the sales contract and the provisions for tenant protection for the 48,000 former council houses in 74 cases out of 167. Over the contract period of ten years two million euros are incurred for each violation, added SPD Group chairman Councillor Peter Lames. The complaint should be filed by the end of March.

William Brennan, meanwhile, has rejected the insider allegations raised against him. BaFin is investigating the chairman of the Gagfah management. The background is that the head of the largest German listed residential-property company sold Gagfah shares worth €4.7 million on 3 February. Brennan denies the allegations, but confirmed that he had long known of the city of Dresden’s investigations on the subject. The city of Dresden had not, however, indicated that they would make claims of any considerable magnitude. Gagfah had heard of these only on 4 March.

Erich Kellerhals, one of the founders of Media Markt/Saturn, is taking the majority shareholder Metro to court. Kellerhals fears that the retail group wants to overturn the minority’s co-decision rights. The electronics chain’s partners’ committee had decided in early March, by simple majority, to establish an advisory board, to largely take over the Committee’s powers. Cordes wanted to take sole power in the electrical retailer, says Kellerhals. De facto, the decision would deprive the minority shareholders of their veto right.

RWE is suing the federal government for ordering the temporary nuclear moratorium and wants to restart the Biblis A nuclear power plant in Hesse soon. The suit was submitted to the administrative court in Kassel on 1 April. It was actually a company-law requirement, quoted the German Press Agency. Each day’s stoppage of Biblis A costs the power company around one million euros in profit, in the opinion of experts. The group surprisingly withdrew on 1 April a statement a few hours old that it was currently not making preparations for restarting the reactor.

The European Court on 3 March rejected the action by Siemens against an antitrust penalty. The German industrial group had sued against the fine of €396.6 million because of a cartel for gas-insulated switchgear. Siemens and ten other European and Japanese companies like Mitsubishi, Toshiba and Alstom were given fines totalling €750 million by the EU Commission in January 2007 because of illegal price fixing in the sale of switching systems. ABB turned state evidence about the cartel and was thus spared the originally intended fine of €215 million.

 

 

 

AGM Dates

 

Company	Event	Date	Time	Place	Address	Published on
DAX
Fresenius	ord.AGM	13.05.2011	10:00	60327 Frankfurt am Main	Ludwig-Erhard-Anlage 1, Congress Center Messe Frankfurt	28.03.2011
	The Agenda for the ordinary AGM of Fresenius SE & Co. KGaA starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Fresenius SE & Co. KGaA earned balance-sheet profits of €139.76m last business year. Of the profits, €139.71m is to be paid out as dividend and €0.05m carried forward to a new account. The existing Authorized Capitals I through V are to be cancelled. A new Authorized Capital I of up to €40.032m is to be created. Additionally, several charter amendments are to be decided. Elections to the Joint Committee are to be held.
adidas	ord.AGM	12.05.2011	10:30	90762 Fürth	Rosenstraße 50, Stadthalle Fürth	22.03.2011
	The Agenda for the ordinary AGM of adidas AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. adidas AG earned balance-sheet profits of €386.46m last business year. Of the profits, €167.37m is to be paid out as dividend and €201.09m carried forward to a new account. The existing Authorized Capital is to be replaced by a new one of €25.0m.
BMW	ord.AGM	12.05.2011	10:00	80809 München	Coubertinplatz, Olympiahalle im Olympiapark	23.03.2011
	The Agenda for the ordinary AGM of Bayerische Motoren Werke AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Bayerische Motoren Werke AG earned balance-sheet profits of €852.11m last business year. The profits are to be fully paid out as dividend. Approval of the system of executive remuneration amended as of 1 January 2011 is to be decided.
Deutsche Börse	ord.AGM	12.05.2011	10:00	65929 Frankfurt am Main	Pfaffenwiese, Jahrhunderthalle Frankfurt	28.03.2011
	The Agenda for the ordinary AGM of Deutsche Börse AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Deutsche Börse AG earned balance-sheet profits of €400.0m last business year. Of the profits, €390.69m is to be paid out as dividend and €9.31 allocated to reserves. The existing Authorized Capital is to be replaced by a new one of €5.2m. The company is again to be authorized to purchase its own shares and use them, also excluding shareholders’ subscription and tendering rights. Authorization to use derivatives in connection with purchase of own shares is to be decided. Amendment of charter §18 is also planned.
K+S	ord.AGM	11.05.2011	10:00	34119 Kassel	Holger-Börner-Platz 1, Kongress Palais	30.03.2011
	The Agenda for the ordinary AGM of K+S AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. K+S AG earned balance-sheet profits of €225.69m last business year. Of the profits, €191.4m is to be paid out as dividend and €34.29m carried forward to a new account. A resolution on the conversion of bearer shares to registered shares is to be taken. Consent to the transmission of information by means of remote data transmission is to be decided.
METRO	ord.AGM	06.05.2011	10:30	40474 Düsseldorf	Rotterdamer Str. 141 (Rheinufer)	23.03.2011
	The Agenda for the ordinary AGM of METRO AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. METRO AG earned balance-sheet profits of €455.93m last business year. Of the profits, €441.53m is to be paid out as dividend and €14.40m carried forward to a new account. Approval of the compensation system for the Board is to be decided. A re-election and a new election to the Board are to be held.
BASF	ord.AGM	06.05.2011	10:00	68161 Mannheim	Rosengartenplatz 2, Congress Center Rosengarten	25.03.2011
	The Agenda for the ordinary AGM of BASF SE starts with the usual items, like presentation of annual accounts and discharge to the company bodies. BASF SE earned balance-sheet profits of €4352.49m last business year. Of the profits, €2020.65m is to be paid out as dividend and €2331.840m allocated to reserves. A by-election to the Supervisory Board is to take place. The remuneration of the Supervisory Board Audit Committee is to be re-regulated. Assent to the control and profit-transfer agreements with Styrolution GmbH and BASF US Verwaltung GmbH is to be decided.
E.ON	ord.AGM	05.05.2011	10:00	45131 Essen	Norbertstr. 2, in der Grugahalle	18.03.2011
	The Agenda for the ordinary AGM of E.ON AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €2858.11m are to be fully paid out as dividend. Approval of the compensation system for the Board is to be decided. Baroness Denise Kingsmill, Mr Bard Mikkelsen and Mr René Obermann are to be elected to the Supervisory Board. The remuneration of the Supervisory Board is to be re-regulated. Assent to amendments to control and profit-transfer agreements between E.ON AG and various subsidiaries, such as E.ON Beteiligungsverwaltungs GmbH, E.ON Energy Trading Holding GmbH, E.ON Finanzanlagen GmbH and E.ON Ruhrgas Holding GmbH, is to be decided.
HeidelbergCement	ord.AGM	05.05.2011	10:00	69181 Leimen	Festhallenstraße 1	24.03.2011
	The Agenda for the ordinary AGM of HeidelbergCement AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. HeidelbergCement AG earned balance-sheet profits of €63.39m last business year. Of the profits, €46.88m is to be paid out as dividend and €16.51m carried forward to a new account. Endorsement of the executive compensation system in force since 01:01:11 is to be decided.
Allianz	ord.AGM	04.05.2011	10:00	80809 München	coubertinplatz, Olympiahalle im Olympiapark	24.03.2011
	The Agenda for the ordinary AGM of Allianz SE starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €2.05m are to be fully paid out as dividend. A by-election of Mr Franz Heiß to the Supervisory Board is to take place. The remuneration of the Supervisory Board is to be re-regulated. Assent to the profit-transfer agreement between Allianz SE and Allianz Global Investors AG is to be decided. Additionally, assent to the spin-off and takeover agreement between Allianz SE and Allianz Deutschland AG is to be decided.
VW	ord.AGM	03.05.2011	10:00	20355 Hamburg	Marseiller Straße 2, Congress Center Hamburg	10.03.2011
	The Agenda for the ordinary AGM of Volkswagen AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Volkswagen AG earned balance-sheet profits of €1039.27m last business year. Of the profits, €1033.62m is to be paid out as dividend and €5.65m carried forward to a new account. Elections to the Supervisory Board are to be held. An Authorized Capital of €110.0m is to be decided. The company is again to be authorized to purchase its own shares and use them. Assent to the control and profit-transfer agreement between Volkswagen Aktiengesellschaft and Volkswagen Vertriebsbetreuungsgesellschaft mbH Chemnitz of 04 February 2011 is to be decided. Additionally, several charter amendments are to be decided.
Lufthansa	ord.AGM	03.05.2011	10:00	14057 Berlin	Neue Kantstraße/Ecke Messedamm, ICC	22.03.2011
	The Agenda for the ordinary AGM of Deutsche Lufthansa AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Deutsche Lufthansa AG earned balance-sheet profits of €274,762.54m last business year, which are to be fully paid out as dividend. Approval of the compensation system for the Board is to be decided. Additionally, the company is to be authorized to issue option and convertible bonds. For this, Conditional Capital of €234.46m is to be kept available.
Bayer	ord.AGM	29.04.2011	10:00	50679 Köln	Deutz-Mülheimer-Str. 111	28.02.2011
	The Agenda for the ordinary AGM of Bayer AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €1240.42m are to be fully paid out as dividend. The term of office of board members is to be changed. Assent to the spin-off and takeover agreement between the company and Bayer Real Estate GmbH concluded on 17 February 2011 is to be decided.
Beiersdorf	ord.AGM	21.04.2011	10:30	20355 Hamburg	Am Dammtor/Marseiller Straße	03.03.2011
	The Agenda for the ordinary AGM of Beiersdorf AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Beiersdorf AG earned balance-sheet profits of €176.4m last business year. Of the profits, €158.77m is to be paid out as dividend and €17.63m allocated to reserves. Additionally, several charter amendments are to be decided. The remuneration of the Supervisory Board is to be re-regulated. Approval of the compensation system for the Board is to be decided.
RWE	ord.AGM	20.04.2011	10:00	45131 Essen	Norbertstr. 2, Grugahalle	08.03.2011
	The Agenda for the ordinary AGM of RWE AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. RWE AG earned balance-sheet profits of €1867.49m last business year. Of the profits, €1867.45m is to be paid out as dividend and €0.04m carried forward to a new account. Elections to the Supervisory Board are to be held. The company is again to be authorized to purchase its own shares and use them, excluding shareholders’ subscription and tendering rights. Additionally, a charter amendment is to be decided.
Munich Re	ord.AGM	20.04.2011	10:00	81829 München		11.03.2011
	The Agenda for the ordinary AGM of Münchener Rückversicherungs-Gesellschaft AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Munich Re earned balance-sheet profits of €1177.93m last business year. Of the profits, €1118.04m is to be paid out as dividend and €59.89m carried forward to a new account. Approval of the compensation system for the Board is to be decided. Ms Annika Falkengren is to be elected to the Supervisory Board. Approval of the compensation system for the Board is to be decided. The company is again to be authorized to purchase its own shares and use them, also excluding shareholders’ subscription and tendering rights. A resolution on authorization to purchase own shares and use them, also employing derivatives, and on the possibility of excluding shareholders’ subscription and tendering rights, is also to be taken. The existing Authorized Capital is to be replaced by a new one of €10.0m.
Daimler	ord.AGM	13.04.2011	10:00	14055 Berlin	Ecke Masurenallee/Messedamm, Messe Berlin Sondereingang	02.03.2011
	The Agenda for the ordinary AGM of Daimler AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Daimler AG earned balance-sheet profits of €2699.26m last business year. Of the profits, €1971.28m is to be paid out as dividend and €727.98m allocated to reserves. Approval of the compensation system for the Board is to be decided. The remuneration of the Supervisory Board is to be re-regulated. Elections to the Supervisory Board are to be held.
MDAX
GILDEMEISTER	ord.AGM	13.05.2011	10:00	33602 Bielefeld	Willy-Brandt-Platz 1, Stadthalle Bielefeld	30.03.2011
	The Agenda for the ordinary AGM of GILDEMEISTER AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €2.98m are to be fully allocated to reserves.
RATIONAL	ord.AGM	11.05.2011	10:00	86159 Augsburg	Am Messezentrum 5, in der Messe Augsburg, Schwabenhalle	29.03.2011
	The Agenda for the ordinary AGM of RATIONAL AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. RATIONAL AG earned balance-sheet profits of €164.72m last business year. Of the profits, €102.33m is to be paid out as dividend and €62.39m carried forward to a new account. A resolution on the non-disclosure of executive remuneration is to be taken.
FUCHS PETROLUB	ord.AGM	11.05.2011	10:00	68161 Mannheim	Rosengartenplatz 2, mannheim:congress GmbH, Rosengarten, Mozartsaal	30.03.2011
	The Agenda for the ordinary AGM of FUCHS PETROLUB AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. FUCHS PETROLUB AG earned balance-sheet profits of €132.49m last business year. Of the profits, €63.17m is to be paid out as dividend and €69.32m carried forward to a new account. Elections to the Supervisory Board are to be held. The remuneration of the Supervisory Board is to be re-regulated. The share capital is to be reorganized through a stock split in a 1:3 ratio, dividing it into 35.49 million ordinary shares and 35.49 million preference shares. A resolution on the non-disclosure of executive remuneration is to be taken.
Tognum	ord.AGM	11.05.2011	10:00	88045 Friedrichtshafen	Olgasraße 20, Graf-Zeppelin-Haus	30.03.2011
	The Agenda for the ordinary AGM of Tognum AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Tognum AG earned balance-sheet profits of €164.9m last business year. Of the profits, €65.69m is to be paid out as dividend and €99.22m carried forward to a new account. Approval of the compensation system for the Board is to be decided.
HUGO BOSS	ord.AGM	10.05.2011	10:00	70629 Stuttgart	Messepiazza, Internationales Congresszentrum Stuttgart ICS	29.03.2011
	The Agenda for the ordinary AGM of HUGO BOSS AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. HUGO BOSS AG earned balance-sheet profits of €142.55m last business year. Of the profits, €139.75m is to be paid out as dividend and €2.8m carried forward to a new account. Approval of the compensation system for the Board is to be decided.
Rheinmetall	ord.AGM	10.05.2011	10:00	10785 Berlin	Stauffenbergstraße 26, MARITIM Hotel Berlin	30.03.2011
	The Agenda for the ordinary AGM of Rheinmetall AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Rheinmetall AG earned balance-sheet profits of €57.8m last business year. Of the profits, €57.46m is to be paid out as dividend and €0.34m allocated to reserves. Approval of the compensation system for the Board is to be decided. By-elections to the Supervisory Board are to be held.
MTU	ord.AGM	05.05.2011	10:00	81925 München	Araballastr. 6, The Westin Grand München Arabellapark	25.03.2011
	The Agenda for the ordinary AGM of MTU Aero Engines Holding AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €53.63m are to be fully paid out as dividend. The existing Authorized Capital II is to be replaced by a new one of €15.6m. The existing Authorized Capital III is to be replaced by a new one of €5.2m.
SGL CARBON	ord.AGM	03.05.2011	10:00	65189 Wiesbaden	Kurzhausplatz 1, Kurhaus Wiesbaden	23.03.2011
	The Agenda for the ordinary AGM of SGL CARBON SE starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €7.6m are to be fully carried forward to a new account. A confirmatory election to the Supervisory Board is to be held. The existing Authorized Capital is to be replaced by a new one of €5.12m.
Hanover Re	ord.AGM	03.05.2011	10:00	30175 Hannofer	Theodor-Heuss-Platz 1-3	25.03.2011
	The Agenda for the ordinary AGM of Hannover Rückversicherung AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Hanover Re earned balance-sheet profits of €302.0m last business year. Of the profits, €277.37m is to be paid out as dividend and €24.63m carried forward to a new account. Additionally, several charter amendments are to be decided. The remuneration of the Supervisory Board is to be re-regulated. In addition, the Company is to be authorized to issue option and convertible bonds. A resolution authorizing the issuance of income bonds, possibly with the opportunity to connect with conversion and option rights, is also to be taken. Furthermore, a resolution authorizing the issuance of participation rights, possibly with the opportunity to connect with conversion and option rights, is also to be taken. The existing conditional capital is to be replaced by a new one of €60.3m. A resolution amending the profit-transfer agreement between the company and Hannover Life Re AG is to be taken.
Continental	ord.AGM	28.04.2011	10:00	30075 Hannover	Theodor-Heuss-Platz 1-3, Kuppelsaal des Hannover Congress Centrums	23.03.2011
	The Agenda for the ordinary AGM of Continental AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. The profits of €61.13m are to be fully carried forward to a new account. A confirmatory election of Prof. Siegfried Wolf to the Supervisory Board is to be held.
Sky	ord.AGM	15.04.2011	10:00	80339 München	Theresienhöhe 15, Alte Kongresshalle	04.03.2011
	The Agenda for the ordinary AGM of Sky Deutschland AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. A confirmatory election to the Supervisory Board is to be held. The existing Authorized Capital is to be replaced by a new one of €354.05m. Additionally, the company is to be authorized to issue option and convertible bonds. For this, conditional capital of €354.05m is to be kept available. Approval of the compensation system for the Board is to be decided. Additionally, several charter amendments are to be decided.
PUMA	ord.AGM	14.04.2011	13:00	91074 Herzogenaurach	PUMA-Way 1, im PUMA Brand Center	01.03.2011
	The Agenda for the ordinary AGM of PUMA AG Rudolf Dassler Sport starts with the usual items, like presentation of annual accounts and discharge to the company bodies. PUMA AG Rudolf Dassler Sport earned balance-sheet profits of €75.0m last business year. Of the profits, €26.97m is to be paid out as dividend and €48.03m carried forward to a new account. A resolution on the conversion of PUMA Aktiengesellschaft Rudolf Dassler Sport into a European Company (Societas Europaea, SE) is to be taken.
Gerresheimer	ord.AGM	14.04.2011	10:00	40474 Düsseldorf	Stockumer Kirchstraße 61, CCD Ost	03.03.2011
	The Agenda for the ordinary AGM of Gerresheimer AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Gerresheimer AG earned balance-sheet profits of €60.7m last business year. Of the profits, €15.7m is to be paid out as dividend and €45.0m carried forward to a new account.
Springer	ord.AGM	14.04.2011	10:00	10888 Berlin	Axel-Springer-Str. 65f, Axel Springer Haus	04.03.2011
	The Agenda for the ordinary AGM of Axel Springer AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Axel Springer AG earned balance-sheet profits of €158.3m last business year. Of the profits, €157.34m is to be paid out as dividend and €0.96m allocated to reserves. A by-election to the Supervisory Board is to be held. The Company is to be authorized to purchase its own shares and use them, to the exclusion of shareholders' subscription and tendering rights. The company's share capital is to be divided in a 1:3 ratio (stock split). Assent to a control and profit-transfer agreement between Axel Springer Aktiengesellschaft and WBV Wochenblatt Verlag GmbH is to be decided. Charter amendments are to be decided.
TecDAX
Drägerwerk	ord.AGM	06.05.2011	10:00	23554 Lübeck	Willy-Brandt-allee 10, Lübecker Musik- und Kongresshalle	23.03.2011
	The Agenda for the ordinary AGM of Drägerwerk AG & Co. KGaA starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Drägerwerk AG & Co. KGaA earned balance-sheet profits of €75.74m last business year. Of the profits, €19.04m is to be paid out as dividend and €56.71m carried forward to a new account. Approval of the compensation system for the Board and the personally liable partner is to be decided. The remuneration of the Supervisory Board is to be re-regulated. The existing Authorized Capital is to be replaced by a new one of €21.13m. A resolution authorizing the issuance of bonus shares, excluding option rights, is also to be taken.
Software AG	ord.AGM	05.05.2011	10:00	64283 Darmstadt	Schlossgraben 1, darmstadtium - Wissenschafts- und Kongresszentrum	28.03.2011
	The Agenda for the ordinary AGM of Software AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Software AG earned balance-sheet profits of €124.56m last business year. Of the profits, €37.0m is to be paid out as dividend and €87.58m carried forward to a new account. The cancellation of the existing conditional capital is to be decided. The company's share capital is to be divided by a stock split in a ratio of 1:3 into a total of 86,148,183 new bearer shares. The existing Authorized Capital is to be replaced by a new one of €43.07 million. A resolution approving the spin-off and takeover agreement with IDS Scheer Consulting GmbH, based in Darmstadt, in order to spin off IDS Scheer's operational business operations is to be decided.
STRATEC	ord.AGM	14.04.2011	10:00	75172 Pforzheim	Am Waisenhausplatz 1-3, CongressCentrum Pforzheim	08.03.2011
	The Agenda for the ordinary AGM of STRATEC Biomedical Systems AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. STRATEC Biomedical Systems AG earned balance-sheet profits of €22.69m last business year. Of the profits, €5.77m is to be paid out as dividend and €16.92m carried forward to a new account. A confirmatory election to the Supervisory Board is to be held. The company is in future to be renamed to STRATEC Biomedical AG. A resolution on the non-disclosure of executive remuneration is to be taken. The existing Authorized Capital is to be replaced by a new one of €5.5 million. Additionally, the company is to be newly authorized to issue option and convertible bonds. For this, conditional capital of €0.8m is to be kept available.
Carl Zeiss Meditec	ord.AGM	12.04.2011	10:00	07743 Jena	Carl-Zeiss-Platz 4, Steigenberger Hotel Esplanade	01.03.2011
	The Agenda for the ordinary AGM of Carl Zeiss Meditec AG starts with the usual items, like presentation of annual accounts and discharge to the company bodies. Carl Zeiss Meditec AG earned balance-sheet profits of €49.4m last business year. Of the profits, €44.72m is to be paid out as dividend and €4.68m carried forward to a new account. Elections to the Supervisory Board are to be held. The remuneration of the Supervisory Board is to be re-regulated. The existing Authorized Capital is to be replaced by a new one of €39.65m. A resolution approving the conclusion of D & O insurance for the members of the Supervisory Board is to be taken. After the already planned merger of the subsidiaries into Carl Zeiss Meditec AG, the Supervisory Board is to be redesigned accordingly, pursuant to the One-Third Participation Act. A resolution authorizing the Board to provide information to shareholders also by way of remote data transmission is to be taken.

 

 

 

Politics

 

Bank levy negotiated

In early March the German Cabinet brought a draft on the bank levy onto the road. Central to the regulation is that German banks should in future pay into a so-called Special Financial Market Stabilization Fund (FMSA). The contribution is based on the total assets of the bank, as well as the risk that a bankruptcy of the institution would bring. According to the bill, the finance houses must in future, even if they enter a loss in their financial statements under the Commercial Code (HGB), pay a minimum contribution of five percent of the regulation amount. What is new is an additional payment obligation for at least three but not more than five years for amounts non-paid in bad years. Thus, banks that should according to regulations pay more will in profitable years make up the difference due. However, a reasonable limit of 15 percent of profit earned applies, and may not be exceeded. The objective of the Fund is in future to save systemically important banks in a precarious situation, without asking the taxpayers to pay. In normal years around one billion euros is to be paid into the fund and the fund's assets should thus grow to up to 70 billion euros. As well as the private banks, savings banks and cooperative banks must pay into the Fund, even if they are not systemically relevant and therefore, cannot request funding from the Fund in the event of loss. The savings banks and cooperative banks are therefore threatening to fight the levy right up to the Federal Constitutional Court. The bank levy is part of the Restructuring Act and should pass the Bundestag and Bundesrat by July. By 30 September the banks will be given their first notifications. The Deutsche Bank alone is likely to be asked to pay €500 million.

 

EU stress test still unclear

After banks from Ireland were under the stress test last year judged to be robust, only to collapse a little later, the European Union wants to do better now with the new edition. By 15 April, 13 German banks and 75 other European institutions are to take a stress test and submit their stress-test forms to national banking watchdogs. It is unclear, however, whether as in the first stress test for the core capital ratio hybrid instruments such as the silent government contributions at Commerzbank will also be counted towards the core capital ratio. In addition to the equity cushion, liquidity is also to be tested for. However, it is still controversial how the risk of state failures is to be simulated in the bank test. Specifically, it is discussed whether as well as the trading book, in which short-term investments are entered at fair value, the banking book should also be used. Here bonds held long-term, and thus also government bonds, are usually accounted for. If discounts on these bonds are calculated here, this would amount to a simulation of a national bankruptcy. The question remains whether, and if so which, results of the tests are to be published, because a bad liquidity result could discredit a bank and affect inter-bank transactions. A recent criticism from EU Monetary Affairs Commissioner Olli Rehn was that EU states had not adequately prepared for the results of the bank test. Like the head of European banking supervisors Andrea Enria, Rehn calls for an emergency mechanism, in which the individual states set out how to deal with failed banks, for example through recapitalization by government rescue funds. Germany closed its bank rescue fund Soffin in late 2010 and instead, like Britain, Ireland and Denmark, introduced a new bank insolvency law, which will cut in if the private owners cannot be asked to pay, say through bonuses and dividend cuts. Enria calls for consequences for near-failures too. The results of the new tests are expected in June.

More women without a quota?

Increasing the share of women in Germany's business continues to be controversial. At a summit meeting of the 30 DAX companies, Chancellor Angela Merkel (CDU) invited the ministers too. They came with very different objectives. Thanks to Merkel, Family Minister Kristina Schröder (CDU) was able to prevail, after wrangling against Labour Minister Ursula von der Leyen (CDU) in the run-up: instead of a fixed statutory scheme Schroeder relies on commitments by companies. She came to meet corporations with a phased plan with flexible arrangements, and merely appealed for the number of women on management and supervisory boards to be tripled by 2013. The CDU lady is expecting the DAX companies to set their own targets this year. If this fails, Schroeder will in 2013 enshrine a legal commitment in which companies set themselves binding target quotas, by which they are then also measured. Schroeder calls this the “Flexi-quota.” Von der Leyen was visibly disappointed, wanting clear targets and objectives on the part of companies; she would already have set a quota of 30 percent. The EU Commission too eyed Schroeder's plan very critically. EU Justice Commissioner Viviane Reding said in a letter to expectant mothers that the EU would give companies only until March 2012 for voluntary solutions. Thereafter, if necessary, Reding wants to get tough, with legal instruments such as an EU directive, which Germany would then have to implement. Reding is aiming at raising the proportion of women on the supervisory boards of European listed companies to 30 percent by 2015 and to 40 percent by 2010. In Germany so far only 13 percent of supervisory board members are women, and only five out of 187 Dax executives female. The SPD criticized the summit meeting as a “placebo event”; the Greens found voluntary commitments inadequate. The Bitkom association, however, warned that in the IT and telecommunications industry statutory quotas for women are unlikely to be to achievable.

 

 

 

People

Lone Fønss Schrøder is in talks for supervisory-board posts at Bilfinger Berger and Heidelberger Druckmaschinen. The two MDAX companies have neither confirmed nor denied this. At the Heidelbergers, Supervisory Board Chairman Mark Woessner is to leave the body soon because he has reached 72, the age limit. Who is to succeed him is not officially known.

After the AGM Steven Holland will be taking the lead at Brenntag. The Acting Chief Operating Officer of the Mühlheim chemical distributor since 2009, he joined the company with the acquisition of Albion Chemical Group in 2006, and on 22 June is to succeed the retiring Stephen Clark, who will then replace Thomas Weinmann on the Supervisory Board. The majority shareholder Brachem Acquisition, which holds 36 percent of Brenntag, wants a direct change, thus triggering a corresponding opening clause and avoiding the two-year cooling-off period. A new board member, with immediate effect, is William Fidler. The 63-year-old manager is currently responsible for North American business. In future he will be responsible for Latin America as well.

Fritz Oesterle is leaving prematurely in late June as CEO of the Celesio Group in Stuttgart. Officially, he departs on the best of terms with the Supervisory Board after more than twelve years in his post, the pharmaceutical wholesalers announced on 16 March. A doctor of law, his contract ran until 2013. Oesterle had lost his post on the board at Haniel in 2009. At Celesio Haniel holds 54.6 percent.

By 1 September, Stefan Borchert will occupy the vacant Patient and Consumer Solutions portfolio at Celesio. It covers the international pharmacy business of the pharmaceutical wholesaler, with over 2,300 locations. This includes Lloydspharmacy and DocMorris. The 41-year-old has long-standing strategic and operational experience in international retailing.

Petraea Heynike is to be the second woman next to Sari Baldauf on the Supervisory Board of Daimler. The South African woman has been nominated for election for five years. Heynike is to resign her offices at the Nestlé Group on 1 May. After about 13 years Manfred Schneider, whose term of office expires at the end of the AGM on 13 April, is leaving the Supervisory Board.

For Peter Job, who at the end of the next shareholder meeting retires by rotation, Deutsche Bank is proposing Katherine Garrett-Cox for election to the Supervisory Board at the Annual General Meeting on 26 May. With the arrival of the Alliance Trust CEO, seven out of 20 members of the Bank’s Supervisory Board, including the five employee representatives, would be female, bringing the women’s quota to 35 percent.

Deutsche Post announced on 9 March that the Supervisory Board had nominated Roger Crook as new Group Board Member responsible for the DHL Global Forwarding, Freight sector. The 54-year-old previously led the group’s DHL Express Asia Pacific, Eastern Europe, Middle East and Africa sector, and replaces Hermann Ude, who left early “by the best of mutual consent” on 31 March.

At the same time as extending the contract for Helmut Ullrich, the appointment of Lars Wittan as a board member of Deutsches Wohnen was announced. Wittan is to be built up as the successor to the former chief financial officer through the end of Ullrich's contract at the end of 2012, and move to the Board on 1 October. His contract runs until September 2014.

Two new Supervisory Board members are in future to monitor the further course of the E.ON board. The outgoing Supervisory Board members of the energy company are to be replaced by Baroness Denise Kingsmill, a member of the British House of Lords, and Deutsche Telekom CEO Rene Obermann. The lawyer and the German manager are to be elected to the Supervisory Board at the AGM on 5 May, said Germany’s largest utility on 9 March. The British aristocrat and the Telekom CEO replace Ulrich Hartmann and Wilhelm Simson, who, as announced in December 2010, will resign at the Annual Meeting. The office of Chairman is to be taken over from Hartmann by the former head of the pharmaceutical company Bayer, Werner Wofenning.

Jean E. Spence is to join the Supervisory Board of GEA Group. The top manager of Kraft Foods is proposed for election on 21 April, as the Bochum plant engineers announced on 10 March in the invitation to the Annual General Meeting. She is in charge of research, development and quality assurance there. The employee side had already proposed Eva Maria Kerkemeier as a member of the supervisory body.

Gigaset has expanded its Board to two members. The Supervisory Board had named Alexander Blum, who has been working at the former Siemens brand since 2008, CFO on 30 March. He is to flank former sole board member Maik Brockmann. Besides the financial side, Blum, at the cordless phone manufacturers for three years now, will be in charge of human resources and investor relations.

Peter Noé, member of the Executive Board of Hochtief since February 2002, is leaving the construction group on 10 September. The Doctor of Business Administration has made use of the special termination right triggered by ACS crossing the 30 percent investment threshold, which according to the annual report entitles him to at least two and a half years’ salary.

As the invitation to the AGM on 12 May in Essen shows, the current Hochtief Supervisory Board, led by Detlev Bremkamp, is proposing an amendment for the next five-year period. As representative of the second major shareholder, Qatar, Yousuf Al Hammadi is to replace current Supervisory Board Member Tilman Todenhöfer. The Emirate of Qatar claims that seat. ACS has also presented its own list for a vote by written procedure. Then Bremkamp would lose his job. The list does not contains a proposal for a new chairman.

The Supervisory Board of Linde has with immediate effect appointed Sanjiv Lamba as a new member of the Board. The 46-year-old Indian is in charge, from Singapore, of the future of the company’s gas business in Greater China, South and East Asia and the South Pacific region. He is also responsible for the Asian joint ventures and for the electronic gases product area.

As the invitation to the shareholders’ meeting of Metro on 6 May shows, Marie-Christine Lombard resigned as of 28 March. Professor Ann-Kristin Achleitner is to move to the Supervisory Board of the retail group as substitute for the French TNT manager. For Achleitner, who is also nominated to the Supervisory Board of Linde, it would be the first supervisory post at a German corporation.

Annika Falkengren is to become a supervisor at the Munich Reinsurance Company. As a press release of the world's largest reinsurer states, the Supervisory Board decided at its meeting on 9 March to propose the 48-year-old SEB boss to the Supervisory Board for election at the next Annual General Meeting on 20 April. The CEO of the Swedish banking giant will replace Thomas Wellauer.

At Qiagen, two internationally recognized leaders in life-science research and medicine are to come onto the Supervisory Board. Shareholders are to vote at the Annual General Meeting on 30 June 2011 on the proposal to elect Vera Kallmeyer and Elizabeth E. Tallett to the Supervisory Board and to renew all six existing Supervisory Board members. Their experience in the health sector and in academic research and their extensive knowledge of the industry will be of great value in further expanding our leading position in molecular sample and assay technologies for academic research, applied testing and clinical diagnosis, said Prof. Detlev H. Rieske, Supervisory Board chair and a founder of Qiagen.

As the Essen DAX company RWE announced, two new members are to be drafted into the Supervisory Board on the shareholder side. Ullrich Sierau (SPD) is to follow the former mayor of Dortmund, Gerhard Lange Meyer (SPD), on the Supervisory Board of the group for a good ten years,. For Essen’s previous mayor Wolfgang Reiniger (CDU), Roger Graef (CDU), also in the management of the Verband der kommunalen RWE-Aktionäre [Association of municipal RWE shareholders] GmbH, is to become the new Supervisory Board member. This is shown by the invitation of the energy company to the next Annual General Meeting on 20 April, at which the former Bayer CEO Manfred Schneider (72) is standing for re-election as Supervisory Board chairman. On the election of the municipal representatives, there are counter-motions from Hermes, Legal & General and DSW.

Wolfgang Dehen has left the Siemens Management Board, and on 1 April became the first CEO of Osram GmbH. This subsidiary, independent in technology and sales, is to be brought onto the stock market in the autumn. The Supervisory Board decided at an extraordinary meeting on 28 March to stay involved in Osram long-term as an anchor shareholder. The successor to the 56-year-old as head of the energy sector is Michael Süß, who at the Division of Fossil Power Generation is already at the top of the most profitable segment of the industry. To participate as a leader in growth and technology trends related to the establishment and renewal of urban infrastructure in developed and emerging countries, Siemens also founded the "infrastructure and cities" sector. This newly created fourth sector is from October to be headed by 46-year-old chief strategist Roland Busch, appointed to the Board, like Klaus Helmrich, on 1 April. The current head of the division of drive technology takes over the board sector of technology. In the course of organizational change, the board is being expanded from eight to ten divisions.

With Annika Falkengren, for the first time a woman is to join the Supervisory Board of Volkswagen, on the capital side. For the election of the supervisory body of the Wolfsburgers, scheduled for 3 May, the head of the Swedish SEB bank is proposed. This was decided by the nomination committee and the Supervisory Board at a single meeting. Hans Michael Gaul is to depart on a rotational basis.

 

 

 

 

Campus

 

GCGC requirements implemented

The Center for Corporate Governance founded by Christian Strenger at the Leipzig Graduate School of Management has published its Compliance Report for 2011. The study, “Kodexakzeptanz 2011: Analyse der Entsprechenserklärungen zum Deutschen Corporate Governance Kodex [Code acceptance 2011: Analysis of the Compliance Declarations under the German Corporate Governance Code],” by Professor Dr. Marc Steffen Rapp, Professor Dr. Michael Wolff and Christian R. G. Kohl, is the first systematic and comprehensive look at the Declarations of the largest German listed companies (DAX and MDAX) pursuant to §161 of the German Corporate Governance Code (GCGC). Companies in the DAX and MDAX with an ISIN beginning with DE were analysed (EADS and Gagfah are not subject to the German Corporate Governance Code), as at end of year 2010 (This email address is being protected from spambots. You need JavaScript enabled to view it.). The Center for Corporate Governance reached the following results:

• On average, the DAX and MDAX companies meet 97 percent of the “target recommendations” of the Code (DAX: 97 percent; MDAX: 96 percent). While many companies have a compliance rate of 100 percent, only a minority meet significantly less than 90 percent of the recommendations.

• Differences show up especially in Chapter 5 (“Supervisory Board"), but also in Chapter 4 (“Board”). Code section 5.4.1 regarding the composition of the Supervisory Board has the highest deviation rate for all companies.

• Large companies continue to conform with the Code more.

• Widely-held companies have higher levels of compliance, thus bringing their internal governance structures more closely into line with the best-practice requirements of the Code.

• Just a few companies reject parts of the Code recommendations totally. In particular, companies oppose recommendations on own-risk for the D & O insurance of the Supervisory Board, on Board remuneration and on the composition of the Supervisory Board.

• For 30 percent of all deviations, the companies predict changes such that the corresponding clauses are fully met in the future or will at least be more closely approached. Thus – given the announced large-scale retention of the Code in 2011 – rising levels of compliance can continue to be expected.

• The Code adaptation in 2010 was met by many of the companies with an updated declaration of compliance only shortly before the year’s end. Some companies have not updated their declaration even after 9 months.

 

Top 50 price destroyers

Despite the generally good performance on the stock market in 2010, there were black sheep who showed a miserable price performance over a period of five years. The list of the top 50 price destroyers published by the DSW is headed by solar group Solon, which has lost some 91 percent of its value since 2006. It is followed by Swiss private equity specialists Corporate Equity Partners (CEP) and photovoltaic specialists Q-Cells. Altogether, solar stocks did rather badly, partly because of reduced subsidies and competition from the Chinese: included on the list are Colexon Energy, Conergy Solar World, Sunways, Solar Fabrik and Singulus Technologies. While 36 of the booby-prize candidates trade in the Prime Standard of the Frankfurt Stock Exchange, the DSW also lists two large DAX heavies, Commerzbank (15th place) and Deutsche Bank (48th place). There are also four MDAX, five TecDAX and three SDAX securities.

Board members’ earnings back

The remuneration of DAX board members regained pre-crisis levels in 2010. On average, their salaries increased, according to personnel consultancy Kienbaum, by 17 percent, reaching top international levels. Direct fees excluding pensions and benefits in the 21 DAX companies examined rose on average to 4.7 million euros, said consulting firm Towers Watson. In essence, it was companies’ improved profitability that contributed to the jump. As earnings per share in the DAX rose, on average, by 100 percent, directly paid bonus shares jumped upwards by 34 per cent. Fixed salaries grew an average of five percent to 1.2 million euros and account for less than a third of total compensation. For the first time the Act on the appropriateness of executive compensation, which seeks to establish sustainable compensation, also left traces. The basis for calculating bonuses is spread over several years, and salaries are more often tied not to short-term price increases but to internal earnings targets. But switching to long-term forms of compensation will make total compensation rather less transparent, Towers Watson feared, as long-term compensation is variously reported. About 35 percent of variable compensation is paid with a delay. The absolute top earner in 2010 was VW CEO Martin Winterkorn, who received 9.3 million euros. Commerzbank CEO Martin Blessing had again to make do with a salary of only €500,000, because of the cap on executive pay at the bank.

 

Große Entrup becomes econsense chief

Wolfgang Große Entrup was appointed new CEO by the Forum Nachhaltige Entwicklung der Deutschen Wirtschaft e.V. [Forum for Sustainable Development of German Industry] (econsense). Econsense is a cross-industry network and think tank of 31 leading globally operating companies and organizations of the German economy, which have jointly committed to the guiding principle of sustainable management. Große Entrup is Head of Corporate Environment and Sustainability at Bayer AG. His predecessor, Professor Hanns-Michael Hölz, ​​is Group Sustainability Officer at Deutsche Bank.

 

More Information for shareholders

Shareholders can in future call up information on the 160 DAX companies (DAX, MDAX, TecDAX and SDAX) on the new Internet portal http://www.hauptversammlung.de of shareholder association Deutsche Schutzvereinigung für Wertpapierbesitz (DSW). On the platform those interested will find comprehensive information on the major German companies, ranging from the agenda and the DSW’s voting recommendations, to basic and insider information (directors’ dealings), to a moderated discussion forum. At the same time, shareholders can exercise their right to vote here online, through DSW. In April, the DSW is also, in cooperation with the European shareholders’ association EuroShareholders, presenting the first pan-European system of voting for individual investors, Eurovote.

Financial professionals like electronic business reports

Financial pros want increased use of electronic business reporting. This is the result of a survey by Frankfurt PR and IR agency ‘financial relations’ among 100 financial-market participants. 68 percent of respondents said that it would be environmentally friendlier and easier if annual reports of listed companies were in future only sent via electronic mail. Electronic annual reports also offered more sources of information, was the unanimous opinion. The majority of study participants would like to get annual and quarterly reports, sales brochures, product brochures, customer magazines and newsletters presented through intelligent use of multimedia and links to Internet content in an attractive mix of text, image, audio and video data. Overall, the study participants complained of fatigue in the use of print media on computer screens or mobile-phone displays. Especially the under-forties regarded the 1:1 conversion as outdated. They invited to take more account of iPhone apps and the like in multimedia communication strategy.

 

Tricksters and cheats

Accounting fraud, antitrust violations and corruption at company level are widespread throughout the world. For its 2011 annual global corporate responsibility report, Munich-based rating agency Oekom Research AG assessed 3,100 companies from more than 45 industries in over 50 countries. On the topic of corruption, the construction industry with 15.3 percent and the aerospace and defence industries, consumer electronics and communications device makers and the tourism and leisure industry with 12.5 percent each take an infamous lead. In terms of false accounting too, companies from the aerospace and defence industry, consumer electronics and communications equipment makers are to the fore; in these three sectors breaches have been documented in every eighth company. Even more widespread, says Oekom, are antitrust violations: three-quarters of the manufacturers of consumer electronics and more than half of the manufacturers of household and chemical products and building materials are demonstrably involved in anticompetitive behaviour.

 

 

 

Capital News

GILDEMEISTER started its announced capital increase on 16 March. The board of the machine-tool manufacturer had decided the capital increase by €11,851,320 against cash contributions, with partial use of the authorized capital, by issuing new shares, representing approximately ten percent of current share capital. The 4,558,200 new shares cost €18.22 per share and were completely subscribed by Mori Seiki, to the exclusion of subscription rights of other shareholders. As the company further announced, the share capital was to be increased by a further €26.1 million. The securities can be subscribed between 29 March and 11 April. Mori Seiki and its subsidiaries have, according to Gildemeister, also committed to exercising their rights in this transaction. The Japanese major shareholder’s total holdings in Gildemeister thereby should not, however, exceed 20.1 percent. The Bielefeld MDAX-listed company intends to use the vast majority of the net proceeds from both capital increases (83 and around 130 million euros) to repay financial debt and thus strengthen its capital base.

 

According to a spokeswoman for the Münchener Rückversicherungs-Gesellschaft [Munich Reinsurance Company], the forthcoming share repurchase will, given the multibillion burden from Japan, be put on ice for the time being. The programme will not start. "We will run the current programme until its end, at the Annual Meeting in April," the world's largest reinsurer announced on 23 March. The DAX Group had announced a new buyback programme worth up to €500 million at the beginning of February, to be completed by the April 2012 Annual General Meeting. Munich Re was aiming at a net profit of 2.4 billion euros in 2011.

 

Nordex pulled in 56 million euros at short notice on a capital increase by ten percent. The wind-turbine manufacturer had its capital increase, announced on 28 March, successfully completed by 29 March. The 6,684,499 new shares were placed under an accelerated procedure ("accelerated bookbuilding") at €8.40 per share. In order to hold up against larger competitors such as Vestas Wind or Siemens, Nordex plans to use the capital resources obtained to successfully strengthen its own products.

 

 

 

 

Director's Dealings

 

 

 

 

VIPsight Shareholders

in March

VIPsight Shareholder ID <click here>

 

 

 

Event Diary

12. April 2011 Finanzierung und Recht des Unternehmenskaufs – ausgewählte Aspekte [funding and law of company purchase - selected aspects]

Organizer: DAI; place: IHK, Börsenplatz 4, Frankfurt am Main; Cost: €900, info: 069 2915-0

 

 

 

Reading suggestions

Haase, Florina, Brändle, Katrin, Investmentsteuerrecht [Investment Tax Law]

Gabler Verlag, 186 pp, €49.95, ISBN 978-3-8349-2716-3

According to recent estimates, about 60 percent of German households own shares in investment funds. The book offers a current and practical introduction to the complicated matter of investment tax law. The focus of the presentation in the book is on the taxation of the investor. A wide range of practical tips and examples make the recommendations easy to understand.

 

Hosp, Thomas, Langer, Matthias, Steuerstandort Liechtenstein [Tax Location Liechtenstein]

Gabler Verlag, 303 pp, €49.95 Euro, ISBN 978-3-8349-1637-2

The legal situation in Liechtenstein is currently developing very dynamically: new tax law, new foundation law, the tax information exchange agreement and double taxation agreements and an anti-fraud agreement with the EU. This presentation of the economic and tax location Liechtenstein therefore not only includes an analysis of the comprehensive revision of the tax law on 1 January 2011, but also deals with Liechtenstein’s international tax cooperation, and gives a detailed analysis of the tax information agreement between Germany and Liechtenstein and the national implementation by both.

 

Meitner, Matthias, Streitferdt, Felix, Unternehmensbewertung [Business Valuation]

Schäffer-Poeschel Verlag, 273 pp, €49.95 Euro, ISBN 978-3-7910-2922-1

The book, geared to the requirements of modern business valuation, deals in particular with issues arising from the changed evaluation environment through the financial crisis. These include proper accounting for inflation, the valuation of distressed companies, the consideration of debt at risk of default, the importance of financial reporting and the identification of periodic value contributions. Case studies illustrate the theory.

 

Plendl, Martin, Kompenhans, Heiner und Buhleier, Claus (eds.), Der Prüfungsausschuss der Aktiengesellschaft [The Audit Committee of the Corporation]

Schäffer-Poeschel Verlag, 257 pp, €79.95 Euro, ISBN 978-3-7910-3064-7

The duties of the audit committee of a corporation were recently normalized and specified by the BilMoG [Accounting Law Modernization Act]. Accordingly, the Audit Committee has to deal explicitly with the monitoring of the financial reporting process, the effectiveness of internal controls, the risk-management system and internal auditing system, and auditing. Neither Supervisory Board practice nor the literature has fully resolved how an audit committee is to meet its monitoring obligations. Against this background, this practical guide presents the tasks and the activity of an audit committee throughout the year and gives concrete recommendations for action, as well as assistance with implementation. To assist Supervisory Board practice, an Excel-based agenda planner is made available to purchasers of the work for download.

 

Schwarzbuch Börse [Exchange Black Book] 2010

SdK, 72 pp, €10, or €8 to download at www.sdk.org/schwarzbuchboerse.php (or free to SDK members)

This is an indispensable handbook for stock-market players: the Black Book 2010 from shareholder association Schutzgemeinschaft der Kapitalanleger (SDK). Here, the Munich shareholder protectors draw up a balance-sheet each year for the past trading year, and pillory mismanagement and bad management at listed German companies. This year, the book lists, in addition to the big names like Commerzbank and Conergy, especially such smaller values ​​as the insolvent EOP Biodiesel, or Loewe, again in difficulties. For ten euros, it can be ordered from the SDK.