Offer procedures

BaFin checked a total of 23 offer documents (previous year: 22) in 2017 and approved their publication in 22 cases, as in the previous year (see Figure 18 "Offer procedures 2013 to 2017"). It prohibited the publication in 1 case.

Figure 18 Offer procedures 2013 to 2017

Offer procedures 2013 to 2017 

BaFin

Takeover bids for STADA Arzneimittel AG

STADA Arzneimittel AG was the subject of two takeover bids in 2017. On 26 June 2017, Nidda Healthcare Holding AG disclosed the failure of its takeover attempt to the public. The offer document published on 27 April 2017 stipulated a minimum acceptance threshold. The bid failed because an insufficient number of shareholders accepted the offer. Already on 19 July 2017, Nidda Healthcare Holding AG submitted a second takeover bid to the shareholders of STADA Arzneimittel AG. It was able to do so, because BaFin had exempted Nidda Healthcare Holding AG from the exclusion period in accordance with section 26 (1) sentence 2 of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz) (see info box "Exclusion period").

What swayed BaFin's decision in the STADA case was that Nidda Healthcare Holding AG indicated that it wanted to make a second offer quickly, thus proving that it had a serious interest in the decision it was seeking. The target company's consent had also been given. Moreover, an assessment of the interests of the two parties did not provide any arguments against an exemption. In particular, there were no indications that the target company's consent had been influenced by extraneous considerations, such as the prospect of lucrative positions for its board members following a successful takeover. For this reason, BaFin was able to approve the application of Nidda Healthcare Holding AG. The renewed offer was successful, with an acceptance ratio of approximately 65.28 percent.

Takeover bids for Pfeiffer Vacuum Technology AG

There were also two takeover bids for Pfeiffer Vacuum Technology AG in 2017. Pangea GmbH published its first takeover bid on 13 February 2017, subject to a number of conditions. For example, the target company was not allowed to call a general shareholders' meeting in connection with the offer. However, the Management Board of Pfeiffer Vacuum Technology AG called such a meeting on 7 March 2017 – for the purpose of discussing the takeover bid. This caused the bid to fail. Although the offeror is generally free to waive conditions up to one working day before the end of the acceptance period, this can only be done in advance. It is not possible to subsequently waive a failed condition. Pangea GmbH was therefore unable to pursue its takeover bid.

On 12 April 2017, Pangea GmbH published a new takeover bid, which specified consideration above the level of the first bid. The exclusion period did not apply to this second bid, because the first bid had neither been prohibited nor had it failed because of not reaching a minimum acceptance threshold. On 27 June 2017, Pangea GmbH announced that the takeover bid for a total of 22,828 shares of Pfeiffer Vacuum Technology AG (corresponding to 0.23 percent of the share capital and voting rights) had been accepted.

Delisting compensation offer of the target company

According to BaFin's settled administrative practice, a public offer by a target company to repurchase its own shares does not constitute a takeover bid within the meaning of the Securities Acquisition and Takeover Act. However, this administrative practice does not apply in cases where a target company wishes to make an offer within the meaning of section 39 (2) of the German Stock Exchange Act (Börsengesetz) (delisting compensation offer).

The first time a target company made a delisting compensation offer to its own shareholders occurred on 12 September 2017. Rheintex Verwaltungs AG (formerly Rheinische Textilfabriken AG) was both offeror and target company in this process.

The offeror's obligation to make a delisting compensation offer to all shareholders of the target company was in conflict with the restrictions of stock corporation law, which apply if the offeror and the target company are identical. In addition to the provisions of section 71 (1) of the German Stock Corporation Act (Aktiengesetz), the offeror absolutely had to comply with the maximum limit of 10 percent of the share capital specified in section 71 (2) sentence 1 of the Stock Corporation Act. To this end, the offeror entered into non-acceptance agreements with five shareholders, which accounted for a share of 90.051 percent of the voting rights. In addition, these shareholders undertook to enter into agreements with their banks to block their securities accounts. To enable BaFin to accept these types of arrangements as a financing measure, they have to specify an indisputable claim to compensation in favour of the offeror for the case that the offer is accepted for the shares in question – even though arrangements to the contrary have been agreed.
The acceptance ratio in the first delisting compensation offer by a target company to its own shareholders was 1.05 percent of the share capital and voting rights of the target company.

Exemption procedures

BaFin received 45 applications for exemption or non-consideration (previous year: 44). In 29 cases, holders of voting rights requested non-consideration of voting rights in accordance with section 36 of the Securities Acquisition and Takeover Act (previous year: 21), while the other 16 applications for exemption were applications for exemption in accordance with section 37 of the Securities Acquisition and Takeover Act (previous year: 21). BaFin approved 35 applications. 3 applications were withdrawn and 19 were still being processed at the end of 2017.

No third-party protection in the Securities Acquisition and Takeover Act

In its decision of 8 January 2018¹, the Higher Regional Court (Oberlandesgericht) of Frankfurt/Main confirmed its previous ruling that the Securities Acquisitions and Takeover Act does not grant third-party protection. The court's decision took into account, among other factors, recent civil law rulings on claims under takeover law by a civil division of the Higher Regional Court of Frankfurt/Main² and by the Federal Court of Justice (Bundesgerichtshof)³ as well as the history of and the following amendments to the Securities Acquisition and Takeover Act.

According to the decision of the Higher Regional Court of Frankfurt/Main, no subsequent administrative third-party protection had to be given to shareholders. This applied, even if shareholders had not accepted a takeover bid and could not assert any claims under civil law because the consideration in the takeover bid had been too low. The Higher Regional Court of Frankfurt/Main thus made it clear that the preceding civil law decisions had no bearing on BaFin's administrative proceedings.

Moreover, the court rejected the complainant's argument that third-party protection in favour of the shareholders who reject the takeover bid could be derived from the original reasons for section 50 of the Securities Acquisition and Takeover Act or subsequent amendments to the Securities Acquisition and Takeover Act.

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