Roth & Rau AG (R8R) dropped the most since it began trading in Frankfurt in 2006 as a planned full takeover by Meyer Burger Technology Ltd., Europe’s biggest solar-panel equipment maker, may take longer than previously anticipated.
Roth & Rau shed 27 percent, the biggest decline since it listed in May 2006, by the market close. Meyer Burger, which today announced as much as 60 million euros ($83 million) of charges from its current Roth & Rau stake after the takeover target forecast a loss yesterday, fell 9.9 percent in Zurich to 19.10 francs, its lowest close since September 2009.
“We are in a difficult business situation, with the market in a hard downturn and with intense consolidation,” Werner Buchholz, a spokesman for Meyer Burger, said in a telephone interview today. “It won’t affect the takeover process itself but to reach 100 percent will take longer.”
The companies’ solar panel-making customers are struggling to cope with weak European demand and are under pressure from Chinese producers such as Suntech Power Holdings Co. and LDK Solar Co. that built capacity as demand slowed, slashing prices. Roth & Rau and Meyer Burger have both been reducing their production in reaction to the decline in demand.
Roth & Rau is still up 30 percent this year, valuing it at 259 million euros, while Meyer Burger has dropped 34 percent.
Meyer Burger may need to take a charge for impairment on goodwill for its stake in Roth & Rau of about 40 million to 60 million euros this year, the Baar, Switzerland-based company said in an e-mailed statement today. Yesterday, Roth & Rau forecast a loss before interest and tax of 52 million euros for the third quarter. It will publish detailed figures on Nov. 15.
Meyer Burger held 85.67 percent of Roth & Rau on Aug. 9 and would buy shares at below 22 euros, Buchholz said.
“We had the control and profit transfer contract in the hope that we could get the Roth & Rau shares faster, but now we will let the market work,” he said.
Roth & Rau will be “channeling all of its efforts” into reorganizing the company and cutting costs to improve earnings and the financial position, it said in a statement today.
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