Dusseldorf The time for a capital increase worth billions could hardly be any more unfavorable: The Austrian sensor specialist AMS wants to collect more than 1.6 billion euros to partially finance the takeover of the much larger competitor Osram.
In addition to the financial investor Temasek, who holds more than five percent of the shares, other important AMS investors also wanted to participate in the capital increase, the Handelsblatt learned from the AMS environment. According to industry circles, there are also hedge funds that could secure additional shares.
The deadline for the capital increase expires on Monday. In the past weeks there had been doubts as to whether the new shares could be placed with investors at all. AMS had already had to make big concessions on the price anyway; the new shares will be offered at a price of CHF 9.20.
For comparison: in autumn the AMS rate was CHF 32. In order to collect the desired amount, AMS had to offer 190 million shares. The AMS share price had temporarily dropped below CHF 9.20 in recent weeks. It was just above it at the end of last week.
The capital increase will be accompanied by the banks HSBC and UBS as well as Deutsche Bank, Erste Group and others. If there were not enough interested parties for the new shares, the financial institutions would have to add the shares to their books.
AMS is relaxed
If the banks remain on too many shares, they may even have to make a takeover offer to the other shareholders. However, the capital increase could still be stopped due to a “change in the financial markets, an accident or a crisis” – as stated in a clause in the prospectus.
In the AMS environment, you are relaxed. There is definitely interest in new shares – even if nobody currently wants to quantify how high it is. If shares ended up with the banks, they could sell them later – possibly at a profit – it said. In addition, AMS has secure bridge financing with which the Osram shares could also be financed without a capital increase.
AMS had offered more than four billion euros for Osram. The Austrians already bought more than 20 percent of the shares on the stock exchange and secured the majority with the offer of EUR 41 per share, which has not yet been completed.
In German industrial circles, many feel confirmed in the face of the problems facing Austrians. “The capital increase is completely on the ropes,” says one from the Osram area. It is quite possible that a large part of the new shares will end up with the banks.
It is risky to rely on bridge financing. Because then the new group would push even higher debts. In view of the emerging economic crisis, AMS should find it difficult to reduce the mountain of debt as soon as promised.
It remains to be seen what will happen if the AMS financing model shakes and the pressure from the banks increases. “The only way out is actually that someone buys the Osram shares from them,” says German industry circles. After all, there are still financial investors who are basically interested in Osram. For example, the financial investors Bain and Advent had long bid for the ex-Siemens subsidiary, but were eventually cut out by AMS.
Strategic takeover still makes sense
In view of the unclear situation and the corona crisis, the Osram share price had fallen from 45 to temporarily 26 euros in recent weeks. When AMS confirmed its expectation to complete the acquisition in the second quarter last week, the price skyrocketed. At the end of the week it was around 32 euros.
Many investors were and are convinced of the strategic sense of the takeover of Osram from the AMS perspective. The Austrians solve two problems with it. In a consolidating market, they alone had a difficult position as a small to medium-sized player.
With the takeover, AMS can also reduce its dependence on the major customer Apple. AMS is doing good business with the mobile phone manufacturer – however, a theoretically conceivable listing would be difficult for AMS.
More: Osram cashes the annual forecast due to the corona crisis