Q&A spin-off - General
Daimler plans a fundamental change in its structure, designed to unlock the full potential of its businesses Mercedes-Benz Cars and Vans und Daimler Trucks & Buses in the future. Daimler Truck will have fully independent management, stand-alone corporate governance including an independent Chairman of the Supervisory Board. The company intends to generate value for its shareholders by accelerating the execution of its strategic plans, raising its profitability and driving forward with its development of emissions-free technologies for trucks and buses. Daimler Truck operates in an industry that is facing major technological and structural changes. Given this context, the company will be able to operate most effectively as independent entity, equipped with strong net liquidity and free from the constraints of a conglomerate structure.
The shareholders of Daimler AG (which will be renamed to Mercedes-Benz Group AG in the future) decided by a great majority on the historic realignment of the Daimler AG. The spin-off of the truck and bus business and the subsequent listing of Daimler Truck Holding AG as an independent company on the Frankfurt Stock Exchange were approved by 99.90% of the capital stock represented for the resolution on the extraordinary shareholder meeting on October 1st, 2021.
Due to the spin-off the Daimler Truck business will be separated from the Daimler Group and the shareholders of Daimler AG will receive traded shares of the Daimler Truck Holding AG. After the spin-off Daimler AG will hold 35.00% of the shares of Daimler Truck Holding AG with 5% being intended to be transferred to the Daimler AG pension trust.
The implementation of the separation by way of a combined spin-off and hive-down under the German Transformation Act is in the best interests of Daimler AG, the Daimler Truck Group and its shareholders. In this respect, in particular the following reasons are decisive:
- Transaction security: The successful implementation of a combined spin-off and hive-down is not dependent on a positive capital market environment to the same extent as would be the case with a public offering of the shares in the course of an IPO, which would require a disposal of the shares to be placed, and therefore offers a high degree of transaction security. In the context of the spin-off, the stock exchange listing of Daimler Truck Holding AG is proceeding along a clearly defined roadmap that provides both Daimler AG and Daimler Truck Holding AG with a reliable basis for planning.
- Clarity and room for maneuver with regard to the relationship between Daimler Group and Daimler Truck Group: In the case of a combined spin-off and hive-down, the shareholding of Daimler AG in Daimler Truck Holding AG can be determined with certainty and precision in advance. In the case of an IPO, the size of the shareholding (indirectly) remaining with Daimler AG would have depended on the willingness of the market to assume the shares. The combined spin-off and hive-down and the conclusion of a deconsolidation agreement can thus create certainty at an early stage with regard to the future shareholding structure and the management of the Daimler Truck Group.
- Furthermore, shareholders invested in the Daimler AG prior to the listing date do not need to invest additional funds for the transaction itself. The Daimler Truck Holding AG shares are allocated automatically to the shareholders, whose shares are held in collective deposit via Clearstream Banking AG, Frankfurt am Main.
Q&A spin-off - Timeline
The listing date of Daimler Truck Holding AG is intended to be December 10th, 2021.
Several legal and organizational prerequisites needed to be fulfilled prior to the spin-off becomes effective. One important milestone for the spin-off of the truck and bus business and the subsequent listing of Daimler Truck Holding AG as an independent company was the approval by the shareholders on the extraordinary shareholder meeting on October 1st, 2021 (consent by 99.90% of the capital stock represented). Another important milestone is the approval of the listing prospectus by the BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht).
Daimler AG will retain a minority interest of 35.00% in Daimler Truck Holding AG and plans to transfer 5.00% to Daimler Pension Trust e.V., a registered association according to German law.
Daimler AG does not intend to completely divest itself of the commercial vehicles business in connection with the separation of the commercial vehicles business, but to support Daimler Truck Holding AG in the upcoming transformation as an anchor shareholder during a longer transitional period and thus to participate in future value enhancement potential at the same time. Since, against this background, Daimler AG considers its future investment in Daimler Truck Holding AG to be a significant investment, it has undertaken vis-à-vis Daimler Truck Holding AG not to dispose of any of the shares in Daimler Truck Holding AG over the period of 36 months after the first day on which the shares in Daimler Truck Holding AG are traded on the Frankfurt Stock Exchange („Lock-Up Period“). Further information is provided in the spin-off and hive-down-report of Daimler AG and Daimler Truck Holding AG (see also cf. 960f.).