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«KfW’s governing body, the “Präsidialausschuss,” yesterday accepted the offer submitted by Lone Star Funds to acquire its stake in IKB Deutsche Industriebank. IKB is, after Corealcredit – formerly Allgemeine Hypothekenbank Rheinboden (AHBR) – the second stricken German bank that Lone Star is planning to restructure.
The transaction agreement was signed today. Closing is expected immediately after the EU ruling on financial state aid for IKB. Lone Star plans to acquire all of KfW’s shares in IKB, which is equivalent to a post-capital-increase shareholding of 90.8%. Lone Star has applied for the restructuring exemption to launch a mandatory takeover offer. Lone Star is thus providing a clean break for KfW, all future risks related to IKB now being assumed by Lone Star.
“KfW’s Präsidialausschuss decision in favour of our offer is a great success for our fund. We are enthusiastic about the prospect of investing our capital, expertise, time, and energy to put IKB back on a sustainable path to long-term value creation for all stakeholders. Lone Star has the solid basis to support the strategy of strengthening IKB as a leading provider of financialsolutions for Germany’s Mittelstand”, says Bruno Scherrer, Senior Managing Director and Head of European Investments of Lone Star.
Lone Star’s strategic goal is for IKB to be the reference provider of financial solutions for Mittelstand companies. This involves three key steps:
1. To remove all areas of risk that could distract IKB management from executing the core strategy, and which would dissipate financial resources at the expense of the core business
2. To ensure that IKB remains a prominent distributor of KfW-sponsored and other long-term lending products
3. To broaden the product range to improve service levels to IKB’s core clients “Small and Medium Enterprises are a solid foundation for the German economy, and it is of utmost importance for this sector to have access to reliable sources of financing. We will be focusing IKB on its strong “Mittelstand” franchise. With the successful restructuring and refocusing of Corealcredit, we have demonstrated our ability to develop and execute concepts for long-term stability and growth,” said Dr.
Karsten von Köller, Chairman of Lone Star Germany» (CS della Società)
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