Under the pressure of Schaeffler, the majority shareholder of the Continental Group, the Hubertus von Grünberg, Chairman of the Continental Supervisory Board, had to announce his resignation after a special meeting of the company’s supervisory board on the 24th, but The position of its supervisory board members remains. According to reports, attending the special meeting of the board of supervisors even included Maria-Elisabeth Schaeffler, the head of the Schaeffler Group, and acting as a “guarantee†when the two companies signed the “Investor Agreement†in August last year. Former German Chancellor Schroeder. Earlier, Schroeder had already appeared as a mediator and had already started emergency negotiations with representatives from both sides and the trade union.
The Schaeffler Group recently accused Hubertus von Grünberg of undermining the "systematic joint solution" between the two companies and only taking into account the interests of the Continental Group, so he has lost the Group's trust in him. The Schaeffler Group even threatened that if Hubertus von Grünberg did not resign, the Group would hold a special shareholders’ meeting to replace all ten members of the Continental Group from the employers. This statement caused public criticism. After Hubertus von Grünberg resigned yesterday, if it is not expected, the Schaeffler Group will send four of its own personnel to the Supervisory Board of the Continental Group under the “Investor Agreement†and the senior lawyer Rolf Koerfer will occupy the chairmanship of the Supervisory Board. It is said that this person played an important role as an advisor in the acquisition of tires in the mainland, and was therefore deeply trusted by Mrs. Schaeffler.
In fact, Hubertus von Grünberg has maintained a good personal relationship with Schaeffler Group's senior management before the Schaeffler Group acquired the Continental Group. He also initially supported the Schaeffler Group's acquisition of the Continental Group. One of the top executives of the Continental Group. No wonder some people claim that this is the Schaeffler Group's "friends of enemies", but this is a last resort. There is no doubt that the Schaeffler Group's intention to expel Hubertus von Grünberg as soon as possible is to seek the right to speak to the Continental Group, so that they can let themselves find a solution to the crisis between the two companies in favor of their own countermeasures.
As market analysts have analyzed, the Schaeffler Group has annexed the Continental Group's aim to establish a third largest auto parts company in the world after Germany's Bosch and Japan's Denso. However, the Schaeffler Group continued to make a turn for the better part of the personnel dispute that lasted more than a week. In fact, behind this dispute, there is a huge potential crisis hidden in the Schaeffler Group. In other words, if the Schaeffler Group cannot immediately grasp the control of the Continental Group and accelerate its integration, including the sale of its tire sector assets to reduce the huge liabilities and financial status of the two companies, the outlook for the auto parts industry is gloomy Under the Schaeffler Group may not be able to control the situation, and ultimately because the "debt build" led to even their own family business also fell into the hands of the creditor bank, thus losing its independence.
The above analysis is well-founded. In recent news, lending money to the Schaeffler Group's acquisition of the six debtor banks of the Continental Group has required the Schaeffler Group to take out most of the equity of the family business as security for the security. It is no longer the previous requirement to take the shares of the Continental Group as pledges. This is undoubtedly catastrophic for the Schaeffler Group. In order to formally acquire the remaining 82,41% of the shares of the Continental Group shareholders from the 8th of this month, the Schaeffler Group has borrowed huge sums from banks, and the bank also agreed to provide it with a total of €16 billion in credits. However, the conditions for borrowing money are obviously more demanding than in the past.
Previously, one of the conditions for banks to lend money to the Schaeffler Group was simply to sign a "competition agreement" in advance. According to the agreement, if the Schaeffler Group cannot reduce the Group’s debt level to 10.5 billion Euros and 7.5 billion Euros respectively in mid-January and before mid-July, the bank has the right to obtain Continental Group shares, and banks to evaluate these shares. It now appears that the Schaeffler Group can hardly complete the task of debt reduction, so creditor banks can only put forward more harsh conditions.
Because, the current share price of the Continental Group has fallen beyond recognition, especially after the mainland group announced plans for capital increase and expansion several weeks ago, the company's stock price has reappeared a downward trend. Schaeffler Group promised a purchase price of 75 Euros per share, and even Continental’s registered share price is only a little over 22 Euros per share. It can be said that the Continental Group shares are insufficient to repay the huge debt owed by the Schaeffler Group to the banks.
According to estimates by industry insiders, the current total debt of the Schaeffler Group and the Continental Group has exceeded 23 billion euros, and the annual interest payment has reached 1.2 billion euros, of which the debt owed by the Schaeffler Group to the bank reached 12 billion euros. Therefore, some people even believe that the Schaeffler Group's acquisition of the Continental Group may eventually become a "disaster" as it did when the Continental Group acquired Siemens' VDO company. They pointed out sharply that the high debt caused by the blind expansion of the Continental Group and the acquisition of VDO company in the previous year was the main reason why it was eventually acquired by the Schaeffler Group. This history may be repeated in the Schaeffler Group. .
Recently, as the global financial crisis has intensified, the friction between the two companies has continued to grow and it has been very unhappy. First, the management of the Continental Group accused the Schaeffler Group of interfering with the negotiations with the bank on loan extension arrangements, thus violating the terms of the “Investor Agreement†that cannot interfere with the autonomous activities of the Continental Group, and the loan is Last year, the Continental Group borrowed 11 billion euros from its acquisition of VDO, an auto parts company owned by Siemens. Second, the Schaeffler Group had also planned to incorporate its group's auto parts business into the Continental Group, allowing the Continental Group to help it share the cost of acquiring 82.41% of the shares, but this proposal was met by the Chairman of the Supervisory Board of the Continental Group Hubertus von Grünberg. Refuse.
However, some industry insiders believe that although according to the “Investor Agreementâ€, the Schaeffler Group can only hold 49.99% of the Continental Group in the next four years and be limited to “minority shareholder statusâ€, and the remaining shares will be kept by a third-party bank, but The Schaeffler Group now has enough voting rights to do what it wants. Therefore, if the Schaeffler Group can properly handle the crisis while taking care of the interests of both parties, it is still possible to resolve the crisis and the possibility of a win-win situation, so as to avoid repeating the mistakes of the Continental Group. According to the latest news, the Schaeffler Group has applied for a 20 billion euros credit guarantee to the country.
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