Innogy chief executive Uwe Tigges has expressed concerns about the proposed voluntary takeover of the company by Eon following an assessment of the offer by the former’s executive and supervisory boards.
Tigges said the company is not able to “conclusively assess” whether the offer price of €40 a share is “altogether fair” because of private agreements between Eon and RWE.
Eon and RWE, which owns Innogy, agreed a complex deal in March that would see RWE end up owning the renewables assets of Eon and Innogy, and Eon having the retail and network businesses of RWE and Innogy.
“Irrespective of the offer price, we are extremely concerned that the job cuts planned by Eon will be unilaterally pursued to the disadvantage of the Innogy employees,” Tigges said.
“There has been some movement in the talks with Eon, especially in the last few days. However, we will measure the success of the negotiations solely by whether Innogy’s employees obtain binding and reliable commitments for a fair integration process,” he added.
Innogy said its executive and supervisory boards have not been able to issue a recommendation to the company’s shareholders following an assessment of the Eon offer.
This is because the boards fear that Innogy’s employees might “suffer structural disadvantages” compared with Eon workers as part of an integration, the company said.
“Given these circumstances, the executive board and the supervisory board cannot support the transaction from the Innogy employees’ point of view without additional safeguards in favour of employees,” Innogy said.
It added that the lack of a legally binding framework agreement with Eon means “there is a great risk that qualified employees might leave Innogy, especially since Eon has so far not ruled out any dismissals for operational reasons”.
The timeline for the deal, which is not expected to close until the end of next year, is also a concern for Innogy.
“That long period of time represents a considerable risk. Eon thereby condones a situation where Innogy’s employees will face uncertainty and qualified employees may leave the company in the time period until completion of the transaction,” Innogy said.
Image: Innogy
Innogy raises takeover fears
By EBS