Auto supplier Hella before sale: Decision by Sunday

The company confirms the owner’s family sales negotiations. There are currently three bids of around €60 per share. A decision must be made by the end of the week.

Hella, which specializes in headlights for German cars, is about to sell to a competitor. The sprawling royal family wants to decide by the end of the week which bidder will accept its 60 per cent stake package, Hella announced Thursday in Lipstadt, North Rhine-Westphalia.

According to Reuters information, three other auto suppliers are competing for Hella: French group Faurecia and Plastic Omnium as well as Germany’s fifth largest auto supplier, piston and air conditioner manufacturer Mahle. Two people familiar with the talks said your offer, which was due on Wednesday, would be around €60 per share of Hilla’s stock. This means that Hella will be valued at less than seven billion euros.

Hala confirms negotiations for the first time

For the first time, Hila confirmed the negotiations between the family’s shareholders that had been going on for months. Approximately 60 members of the Hueck and Röpke family pooled their 60 percent stake in a pooled holding before its IPO in 2014, which is still valid until 2024. But in the spring, it became known that Jürgen Bernd, as the family’s representative on the shareholder committee , tasked the investment bank Rothschild to find a buyer, preferably one from Europe. The 72-year-old Bernd handed over management of the group in 2017. No successor is in sight who could pool the family’s interests in the future.

Hella tried to reassure 39,000 employees: an agreement had already been negotiated with all potential buyers “to protect the interests of the company and its stakeholders broadly,” the letter said. The group did not mention the names of the parties involved. In the last financial year 2020/21 (as of the end of May), Hella managed to increase sales by 13 percent to 6.5 billion euros, making it one of the top ten German car suppliers. The operating result (EBIT) for one-time effects recovered has been adjusted to €510 (2019/20: 227) million.

The stock rose after the announcement of sales plans

On Thursday, Hella’s share of the small-cap index, MDAX, fell 3.7 percent to 62.10 euros. Hopes of an offer of up to 70 euros drove the newspaper to 68 euros at the start of the week. An insider said it was an illusion that potential buyers would continue to outbid each other yet in the final boom. Before the plans for the sale became known, the stake was 45 euros. Although the suppliers from France are eager for Hella, they will have to stretch to fund the acquisition. According to the Handelsblatt report, the family could also hold a minority stake after the sale.

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