Calling it the "will of a majority of its shareholders", Mannesmann has agreed to a friendly takeover offer from Vodafone.
Ending months of wrangling, Mannesmann accepted Vodafone's sweetened bid of 58.96 shares of Vodafone stock for each share of Mannesmann, the German conglomerate said in a statement issued yesterday. That figure is about 5 per cent higher than Vodafone's earlier offer for the company, Mannesmann said.
Vodafone will hold 50.5 per cent of the merged company, and Mannesmann will hold 49.5 per cent. The new company will have headquarters in both the UK and Germany.
Although Mannesmann chairman Klaus Esser did, in the end, agree to Vodafone's offer after months of resisting Vodafone's hostile bid, he will not stay with the company. In a brief televised press conference at Mannesmann headquarters in Dusseldorf last night, Esser said he only plans to stay with the company until June.
Asked by journalists whether he had lost out in the arrangement, Esser said that he had continued to represent the interests of Mannesmann shareholders throughout the negotiations. He pointed out that the value of the original offer had increased by 90 per cent since Vodafone first made its bid in October last year. The original bid was worth 100 billion euros ($US97.64 billion), and the deal is now worth some 190 billion euros, Esser said.
Other points that have been agreed on are that Mannesmann's engineering and automotive business will be taken public in the middle of the year, and that Mannesmann's shares in the German fixed-line carrier Mannesmann Arcor and the Italian carrier Infostrada may not be sold by the new entity, according to the Mannesmann statement.
The deal still must be approved by the companies' supervisory boards.