Lighting firm Osram backs €3.7bn AMS bid over rival private equity offer

German firm has accepted a €38.50 per share deal from Austrian manufacturer over bid from Bain Capital and Carlyle Group

Osram's biggest union, IG Metall, has said it "strongly opposes" the proposed takeover by AMS. Reuters
Osram's biggest union, IG Metall, has said it "strongly opposes" the proposed takeover by AMS. Reuters

German lighting company Osram recommended a €3.7 billion (Dh15bn) takeover bid from Austria's AMS over a combined offer from Bain Capital and Carlyle Group after AMS sought to address concerns over financing.

The financial terms of AMS’s offer eclipse Osram’s lingering concerns about how the takeover will be financed, the Munich-based lighting maker said.

“The management board and the supervisory board do not share AMS’ intended strategy with regard to some important strategic elements,” Osram said, outlining its decision to shareholders. “Certain issues require further coordination between Osram and AMS.”

Meetings between AMS and investors across Europe, the US and Asia over the last two weeks revealed “strong support” for the acquisition, AMS said in a separate statement on Monday. It reduced the minimum acceptance rate for its €38.50 offer to 62.5 per cent, from 70 per cent.

Osram’s chief executive Olaf Berlien will not tender his Osram shares to AMS, the company said in its statement.

Osram has been in the middle of a bidding war since July, when AMS offered to counter a €35 bid from the private equity duo. AMS’s proposal was cleared last week by the country’s financial watchdog, allowing offers to remain open until October 1.

Bain and Carlyle are considering increasing their offer, currently valued at €3.4 billion, people familiar with the matter said in August.

Osram’s board endorsed Bain and Carlyle’s bid in July. At the time it allowed AMS’s offer to proceed without giving it formal approval.

Unions and worker representatives, who make up half of Osram’s supervisory board, have questioned AMS’s planned savings from a deal, saying it would lead to job losses and facility closures in Germany.

The labour groups have approached individual investors, including Allianz, Osram’s largest shareholder, which had said the Bain-Carlyle offer wasn’t high enough.

IG Metall, the union that represents Osram workers, “strongly opposes” the AMS deal, a spokeswoman said late last week.

Published: September 16, 2019 11:25 AM


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