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Macquarie in Germany’s first ’hostile’ take-private

The Australian banking group has signalled an €1.1bn unsolicited offer for Techem, a German utility data services provider, whose board has said it will wait to examine the proposal before judging it hostile

Macquarie, the acqusitive Australian banking group, has initiated Germany’s first “hostile” public-to-private with a €1.1 billion bid for Techem, a German energy and water billing data services provider.

Macquarie’s European Infrastructure Fund II, which targets European infrastructure and essential service businesses, said it would make a public offer to the shareholders of Techem, through its wholly-owned subsidiary MEIF II Energie Beteiligungen.

In a short statement, responding to Macquarie, Techem said: “We take note of the intention of Macquarie European Infrastructure Fund II to make a public tender offer to the shareholders of Techem. Macquarie’s decision to make a public tender offer is unsolicited,”

At present, the takeover offer was not yet deemed “hostile”, Techem said. That would only be decided after management had closely examined the offer.

In conjunction with its parent the Macquarie Group, the infrastructure fund accounts for 17 percent of the outstanding shares of Techem. Once further purchases are settled Macquarie expects the voting power of MEIF II to be at a higher ownership level.

MEIF II has said it will offer €44 in cash for each Techem share, representing a total equity value of €1.1 billion. The offer price is at a premium of 18.9 percent to the three-month weighted average as at 20 October 2006.

Martin Stanley, executive director of Macquarie Bank, with responsibility for its European infrastructure funds said: “Techem management’s efforts and recent announcements have been fully reflected in the offer.  Macquarie is offering shareholders the opportunity to achieve a full, cash price, or to retain a low-yielding investment.”

MEIF II was established in May 2006. It has commitments to date of €1.8 billion primarily from European pension funds and institutions, and aims to make between eight and 15 investments in European infrastructure and essential service businesses.

MEIF II is a cornerstone investor in the Macquarie-led consortium that acquired Thames Water on 16 October 2006.

Macquarie Bank’s London division, Macquarie Corporate Finance Niederlassung Deutschland, Dresdner Kleinwort and Clifford Chance are advising MEIF II on the offer.