Ams transfers a chunk of its Osram shares internally at well below price

July 14, 2020
It was a “routine” matter in closing the deal last Thursday, the company says. Expect more denouements in this saga.

Austrian sensor company ams has closed its acquisition of Osram, but that doesn’t mean that the numbers game that has characterized the saga is over.

Case in point: The company revealed that on July 9, the day the deal closed, one ams group picked up a significant chunk of Osram shares from another ams group at a mere fraction of the €41.00 per share acquisition price.

Ams disclosed the €0.15 per share transfer of about 28,000 Osram shares in the “mandatory announcements” portion of a website it created last year to post developments related to the Osram acquisition.

The “mandatory announcements” are not press releases. They tend to be statements of financial maneuvers, written in financial speak. Ams has posted nearly two dozen of them since last October. While they have sometimes signaled major pivots in the long and winding ordeal that closed last Thursday, ams told LEDs Magazine that the July 9 transfer was simply a routine and necessary measure related to the close.

“The €0.15 was just a share transfer within the ams group, which was legally required to execute the transaction,” a spokesperson told us.

The money transferred from an Austrian entity to a German registered one.

Ams AG is a global company based in Premstaetten, Austria. It is the 100% owner of ams Offer GmbH, an Ismaning, Germany company it formed last year to handle the Osram acquisition. Ams refers to ams Offer GmbH as “the Bidder” in its Osram actions.

In the mandatory announcement dated July 9, ams wrote, “On July 9, 2020, the Bidder acquired by way of an intra-group transfer from ams AG 28,007,603 Osram shares (the “Contribution Shares”). This corresponds to approx. 28.92 % of the share capital and the voting rights of Osram Licht AG.”

The July 9 announcement further explains that the transfer “was effected by way of a capital increase against contribution in kind,” and in an understatement, it notes that at €0.15 per share, the price was “thus below” the €41 per share purchase price.

“There is no further background to this, just a legal procedure as required by German takeover law,” the ams spokesperson told LEDs.

The same mandatory announcement also noted that ams AG has closed the purchase of 4,665,345 Osram shares at €40.99 outside of the stock market — a euro cent below €41 per share.

According to Reuters’ companies portfolios, Osram has 104.69 million outstanding shares.

Ams’ acquisition of Osram dates back to last summer and finally closed on July 9, three days after EU regulators approved it.

It has been fraught with the financial challenges that one might expect when a smaller company attempts to buy a larger one. Osram was roughly four times the size of ams at the outset and is still considerably larger, although Osram has shrunk while ams has grown.

Ams was able to purchase 69% of Osram, enough to gain governing control, but not enough to gain “domination” under German law, for which it needs 75%. That has left it without access to Osram’s cash, and has also tied the hands of ams and Osram as they attempt to discuss integration of the two companies. At one point, ams devised a plan to gain domination another way — by asking Osram shareholders to approve it. It’s not clear where that initiative stands.

Adding to the tumult, Austrian regulators have been looking into possible insider trading by ams related to the acquisition.

And in a new development, Reuters reported that German financial regulator Bafin is investigating possible insider trading of Osram shares over a year ago relating to an Osram announcement regarding developments with suitors Bain Capital and Carlyle Group. Bain and Carlyle at one point were jointly in the running for Osram.

An Osram spokesperson told LEDs that the Bafin investigation “is neither into Osram nor into Osram employees.”

MARK HALPER is a contributing editor for LEDs Magazine, and an energy, technology, and business journalist ([email protected]).

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About the Author

Mark Halper | Contributing Editor, LEDs Magazine, and Business/Energy/Technology Journalist

Mark Halper is a freelance business, technology, and science journalist who covers everything from media moguls to subatomic particles. Halper has written from locations around the world for TIME Magazine, Fortune, Forbes, the New York Times, the Financial Times, the Guardian, CBS, Wired, and many others. A US citizen living in Britain, he cut his journalism teeth cutting and pasting copy for an English-language daily newspaper in Mexico City. Halper has a BA in history from Cornell University.