MAN Shareholder Group Rejects VW Domination Accord Terms

Revelation Capital Management Ltd. has rejected Volkswagen AG’s offer of 80.89 euros and 3.30 euros guaranteed dividend as too low.

“We have asked MAN’s boards in previous letters and we now ask MAN’s boards publicly to negotiate much higher final offers from VW, or to reject the offers,” Revelation Capital said in a letter obtained by Bloomberg. The company said it was acting on behalf of funds with an interest of approximately 210,000 MAN SE shares.

Volkswagen is pushing for deeper integration between MAN, its own commercial-vehicles unit and Swedish truckmaker Scania AB, which it also controls, to leapfrog Volvo AB and Daimler AG as the biggest producer of heavy trucks in Europe.

The minority shareholder group said that “anything less than the higher of the 95 euros offered by VW in 2011 and the highest price VW paid to build MAN stake to 75 percent would be unfair.”

The guaranteed dividend of 3.30 euros is “also below estimates”, the group said. A normal procedure using risk-free rate and the cost of equity would “yield a guaranteed dividend closer to 5.5 percent or 4.45 euros,” it said.

Volkswagen, which owns 75.03 percent of the Munich-based company’s voting rights, will set the final cash offer after it receives valuation reports from auditors, MAN said March 21 in an DGAP ad-hoc release. The offer price represents a 7.1 percent discount to MAN’s closing price today.

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