Schaeffler and Conti-Takover Attempt

5772 Words24 Pages
Schaeffler and ContiA Fusion on Ice Abstract I Abstract German companies are famous for aggressive takeover tactics. A popular technique is to buy options instead of buying straight shares when planning a takeover, which is regarded as critical. Skipping the mandatory offer or keeping it low in order to prevent the capital of the offender. That is why the German market is viewed as primitive. Pioneering for such an action was Porsche and VW. An actual example is what is happening at VW and MAN. Schaeffler aslo used this technique to acquire Conti, the keyword is creeping takeover. Other bankers argue that these two cases, on the one hand Schaeffler and Conti, on the other hand Porsche and VW, argue that the difficulties of these two cases do not lie in their German provenance. It was simply a difficult deal for that time in that market1. Schaeffler’s aim was to create a new global supplier together with its biggest business partner Conti. But with its adverse takeover attempt, Schaeffler encumbered with heavy debts. This paper analyzes the takeover attempt of Conti by Schaeffler in 2008. It focuses on the creeping takeover of Schaeffler, whereby it will provide a closer look at the mandatory offer in Germany and the use of derivates. The following paper is divided into 9 sections. First of all both companies, Schaeffler and Conti, will be presented, followed by an introduction that contains general information about the acquisition attempt of Conti by Schaeffler and finally why the fusion has still not been completed. The main part of the paper explains the financial techniques and tricks that Schaefller used to acquire Conti, this part will provide detailed information about the mandatory offer in Germany and the use of derivates. Further, critical statements on the fusion are revealed as well as the impediments that explain why
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