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Osram Takeover Battle Continues After AMS Bid Fails

Osram Takeover Battle Continues After AMS Bid Fails

Bloomberg reports that the most recent takeover offer from AMS for control of Osram Licht AG has failed. The Austrian supplier to Apple Inc. says it will keep fighting, even after the sweetened 4 billion euro ($4.4 billion) bid collapsed.

AMS is currently the biggest shareholder in the German lighting maker, which still has private equity investors Bain Capital and Advent International planning to make an offer.

“We doubt private equity will launch a superior bid given AMS has built up a 19.99% stake in the meantime,” Commerzbank said in a note. “While we cannot rule out that AMS might make another push, timing is yet unclear, so we attach a greater likelihood to a potential cooperation only.”

AMS’s takeover pursuit took a setback Friday, when it failed to attract enough support from shareholders. Osram investors had tendered only 51.6% of their shares, short of a 62.5% threshold. Both Osram and AMS shares fell following the news.

In early August, lightED reported on Osram’s third quarter earnings results, where the lighting company showed concern for the next year due to “economic turbulence.” As a result, the company did not predict any long-term earnings expectations.

AMS, a supplier of facial recognition technology for Apple’s iPhone, says it has a bridge loan to complete the transaction to take over Osram. But it added the merger would mean it will save hundreds of millions of dollars by cross-selling products after the deal.  It also promises to invest in manufacturing at the Regensburg, Germany plant by consolidating LED production, and would not change any collective bargaining agreements or pension plans for the next five years. It added that it would plan to phase out a consumer lighting division after the deal.


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