The group’s offer of €53 per share was rejected in July by VTG management, which deemed the offer as “not appropriate” and did “not reflect the fundamental value” of the company.
However, Morgan Stanley has remained bullish on the price and has again offered €53 per share to acquire the entire share capital. The firm, which initially invested in the company in 2016 via its €3.6 billion North Haven Infrastructure Partners II fund, was a 29 percent shareholder prior to its offer last month. However, it is set to become a 49 percent owner after Switzerland-based Kühne Holding – unlike VTG – accepted Morgan Stanley’s July bid, agreeing to sell its 20 percent stake.
While German takeover law requires a mandatory offer for all the shares once a group owns at least 30 percent of a company, it was at Morgan Stanley’s discretion to submit a bid on the same terms. Infrastructure Investor understands Morgan Stanley expects the offer to be rejected again but is hopeful the remaining VTG shareholders see Kühne’s acceptance as a sufficient indicator of the value.
“Our offer shows that we believe in VTG AG and its future prospects,” said Markus Hottenrott, chief investment officer of Morgan Stanley Infrastructure Partners. “We are satisfied that we have secured the stake of Kühne Holding AG, an experienced investor and the second largest shareholder in the company.”
Frankfurt-listed VTG had yet to comment to the market on the latest offer. It has two weeks to do so. VTG has a presence in Europe, North America, Russia and Asia, and a fleet of around 83,000 rail freight cars and wagons. It was formerly owned by WL Ross, the private equity group chaired by the US Secretary of Commerce Wilbur Ross.