Atecs Takeover by Bosch and Siemens Clears First Hurdle
30 August 2000
Atecs Takeover by Bosch and Siemens Clears First Hurdle at European Commission
MUNICH, Germany, Aug. 29 The European Commission has given
a green light to the takeover of the three Atecs companies VDO AG, Dematic AG
and Sachs AG. Brussels had already approved the takeover of Demag Krauss-
Maffei AG on August 11. A decision regarding Rexroth AG will be made
following a more thorough evaluation. Bosch and Siemens have thus cleared the
first hurdle in their planned takeover of Atecs Mannesmann AG. The European
Commission approved the deal on the condition that part of the postal
automation business be divested for competitive reasons.
A decision by U.S. antitrust authorities is expected in the coming months.
The takeover concept calls for Atecs AG to be held jointly by Bosch and
Siemens. The two partners will operate one of the Atecs companies, Demag
Krauss-Maffei AG, as a parity-based joint venture. In order to comply with
antitrust requirements, appropriate legal structures were developed for the
other Atecs companies. Bosch is not allowed to have any managerial influence
on VDO and Sachs, and Siemens cannot have any influence on Rexroth.
Compliance with these requirements was guaranteed with lease and subordination
agreements.
* VDO
VDO and Siemens Automotive Systems will be merged as Siemens VDO
Automotive GmbH. A leasing company wholly owned by Siemens will lease the
entire GmbH business, thus eliminating any influence by Bosch. Siemens VDO
Automotive will be one of the world's leading automotive suppliers of high-
tech electronic systems. The new company will have leading positions
worldwide in the fields of driver information systems, cockpit systems, car
communications, powertrain, body electronics, and security electronics. The
new company will start out with a sales volume of roughly 7 billion euro and
have approximately 50,000 employees. Dr. Franz Wressnigg (56), head of
Siemens Automotive Systems, will be the CEO of the new company.
* Dematic
Dematic will be merged with the Siemens Production and Logistics Systems
Group (PL). Managerial responsibility will be held by Siemens based on a
subordination agreement. The new company will be launched with sales of 3.8
billion euro and some 20,000 employees. This merger will position Siemens as
a world market leader in the rapidly growing field of logistics automation.
The company's comprehensive know-how in e-commerce fulfillment (the interface
between receiving orders via the Internet and processing them) will make it
the world's largest supplier in the field of logistics automation. The new
company will offer end-to-end supply chain solutions -- including material
flow-, production- and logistics automation -- for customers such as postal
services, airports, the electronics industry and trade. The new CEO will be
Dr. Dietmar Straub (45), currently head of Mannesmann Dematic AG.
To prevent the company from gaining a dominating market position in the
field of postal automation, the European Commission requires that the company
give up part of its postal automation business. To comply, Mannesmann Dematic
Postal Automation (MDPA) will be sold. This business is headquartered in
France and Belgium, has a total sales volume of around 100 million euro and
700 employees.
* Sachs
In order to eliminate antitrust concerns about Bosch exerting an influence
on Sachs, Siemens will have managerial responsibility for this company. This
exclusive control will be ensured by a leasing company wholly owned by
Siemens. Siemens will make available its electronic know-how to Sachs to
enable the company to continue developing its electronic body control systems
and electronic transmission systems. Sachs is already cooperating with
Siemens in these sectors. The company's headquarters will remain in
Schweinfurt, and Hermann Sigle (57), currently CFO and deputy CEO, will stay
on as CEO. Sachs generated sales of 2.2 billion euro in fiscal 1999 with
nearly 20,000 employees.