The district court does not consider a swift replacement of the three vacant positions on the supervisory board to be so urgent.
(Photo: dpa)
Frankfurt The real estate financier Aareal Bank wants to replace its three voted supervisory board members with three candidates with banking experience: The bank had proposed Friedrich Munsberg, Holger Giese and Ulrich Theileis to the local court, the Handelsblatt learned from two people familiar with the matter. Aareal Bank did not want to comment on that.
Theileis is a board member of the state-owned development bank of Baden-Württemberg L-Bank. Munsberg was head of the municipal financier Dexia Kommunalbank for many years and heads the board of directors of the real estate investment manager Corestate. Giese was once chief counsel at Deutsche Postbank and DB Privat- und Firmenkundenbank, the private customer division of Deutsche Bank that has now been integrated into the group.
The replacement of three members of the supervisory board is necessary because a majority of the shareholders voted out three members of the supervisory body at the extraordinary general meeting on December 9th at the request of the activist investor Petrus Advisers.
For the replacement candidates proposed by the hedge fund, the former Hypovereinsbank board member Heinz Laber, the former Hypovereinsbank and Commerzbank manager Marion Khüny and the former JP Morgan takeover specialist Joachim Sonne, there was no majority at the shareholders’ meeting: 56 percent of the shareholders refused them off.
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Both Aareal Bank and Petrus Advisers subsequently applied to the Wiesbaden district court to judge three substitute candidates for the supervisory board. Aareal Bank sent Munsberg, Giese and Theileis into the running, Petrus Advisers Laber, Khüny and Sommer.
Majority missed by mishap
The hedge fund justifies this, among other things, with the fact that its candidates probably missed a majority due to a breakdown: According to financial circles, the US bank Morgan Stanley had announced the votes of the likewise bank-critical hedge fund Teleios too late for the general meeting. With his votes, Petrus Advisers would have prevailed on this question. Teleios had therefore asked Aareal Bank in writing to propose the Petrus candidates to the court.
The district court has now decided to reject the applications of both counterparties and thus to leave the three positions on the supervisory board vacant. The responsible judge justified the decision to the Handelsblatt by saying that the usual three-month period provided for by the German Stock Corporation Act had not yet expired. Such a subsequent nomination is also possible earlier in urgent cases. But “the court has denied such an urgent case,” said the court by email.
This means that the supervisory body remains incomplete in the middle of an ongoing takeover poker game. According to the court, the resolutions are not yet legally binding – and both Aareal Bank and Petrus Advisers are defending themselves against the decision.
“The Wiesbaden District Court has rejected our application for the judicial appointment of three new Supervisory Board members because it does not see any urgency. We see it differently and that is why we have lodged a complaint against this decision, ”said a spokesman for the real estate financier. Upon request, Petrus Advisers also announced that they had lodged a complaint.
The court’s decision remains open
Both sides are likely to argue that a fully occupied supervisory board is important in an ongoing takeover process. After all, the ongoing takeover attempt is a momentous step for the bank and the shareholders. If the court rejects the complaint, the two opposing parties can take action before the higher regional court.
The decision leaves open the criteria by which the court would have decided between the competing applications. Most of the time, judges follow the proposals of a stock corporation when appointments are made in court, but shareholders can also make such requests. “The question of how the court decides in the event of several content-wise divergent applications is not regulated in the law,” the court informed the Handelsblatt.
In the case of an admissible application, the court had to grant the other parties involved, such as the board of directors, other members of the supervisory board and, if applicable, shareholders a “fair hearing and to check whether the proposed persons meet the legal requirements for appointment”.
More: Aareal Bank: Major shareholder wants to enforce its own supervisor in court