Osram achieves high value growth for shareholders thanks to consistent transformation

2020/09/22

  • Osram and ams AG sign a Domination and Profit and Loss Transfer Agreement
  • Auditors value Osram at EUR 44.65 per share
  • Guaranteed dividend for shareholders of more than five percent (EUR 2.24 per year)
  • Increase in value of more than 1.8 billion euros since the going public in 2013

Osram and ams today signed a Domination Agreement from which Osram's remaining minority shareholders can benefit. PwC, the auditors commissioned jointly by the two companies, have completed their valuation report in which they value Osram at EUR 44.65 per share. “The auditors have confirmed the validity of our transformation strategy and the course we have steered through both the slump in the automotive industry and the corona crisis. Our growth story continues and we envisage a significant recovery as early as 2021,” said Osram CEO Olaf Berlien. “We are delighted that our bidding process has enabled us to create substantial value for our shareholders, even under these difficult conditions”. Just five years ago, Osram generated 70 percent of its turnover with traditional products. Today, 70 percent of revenue comes from state-of-the-art semiconductor technologies. The strategy of transformation was the right one and has made the company attractive to numerous bidders. Ultimately, this is reflected in the current valuation.

Just one week ago Osram raised its forecast for the 2020 fiscal year. Thanks to determined cash management, both adjusted EBITDA and Free Cash Flow are going to be significantly better than expected.

The increase in value is not least due to the transparent bidding process that Osram’s managing board and supervisory board launched when signs first appeared of competition between prospective strategic and financial buyers.
In accordance with legal requirements, the independent auditors assessed the business, technologies and prospects of the Munich-based photonics champion over recent months. Auditors PwC came to the conclusion that OSRAM is worth 4.3 billion euros in its current constitution. “The valuation shows that our path to becoming a photonics champion was and is the right one, and we will continue steadfastly along this path together with ams”, said Olaf Berlien.
The valuation report provides the basis for the pending mandatory compensation offer from ams to the minority shareholders of Osram under the Domination and Profit and Loss Transfer Agreement. At present, almost 30 percent of the outstanding capital is still in their ownership.
PwC’s valuation indicates that those shareholders who want to retain their Osram shares will also benefit. According to the arrangements made in connection with the Domination and Profit and Loss Transfer Agreement, they will receive a guaranteed dividend of more than five percent or net 2.24 (gross 2.57) euros per share.
The valuation report also noted that for the coming 2021 fiscal year Osram expects comparable sales growth of between six and ten percent an adjusted EBITDA margin of nine to eleven percent and a Free Cash Flow ranging from a balanced to a positive low double-digit million Euro figure. Osram recently published this information in the form of an ad hoc release.


ABOUT OSRAM

OSRAM, based in Munich, is a leading global high-tech company with a history dating back more than 110 years. Primarily focused on semiconductor -based technologies, our products are used in highly diverse applications ranging from virtual reality to autonomous driving and from smartphones to smart and connected lighting solutions in buildings and cities. OSRAM uses the endless possibilities of light to improve the quality of life for individuals and communities. OSRAM’s innovations enable people all over the world not only to see better, but also to communicate, travel, work and live better. OSRAM has approximately 23,500 employees worldwide as of end of fiscal 2019 (September 30) and generated revenue of about 3.5 billion euros from continuing activities. The company is listed on the stock exchanges in Frankfurt and Munich (ISIN: DE000LED4000; WKN: LED 400; trading symbol: OSR). Additional information can be found at www.osram.com.

Disclaimer

This document contains statements and information pertaining to our future business and financial performance and future developments that may constitute forward-looking statements – i.e. statements about processes that take place in the future, not in the past. These statements pertaining to the future can be identified by expressions such as "anticipate", "expect", "want", "intend", "plan", "believe", "aspire", "estimate", "will”, "predict" or words of similar meaning. Such statements are based on current expectations and certain assumptions of OSRAM‟s management. They are, therefore, subject to certain risks and uncertainties. A variety of factors, many of which are outside the control of OSRAM, have an influence over OSRAM's business activities, achievement, business strategies and results. These factors may cause the actual results to differ materially from the statements of OSRAM, successes and achievements to results, performance or achievements expressed or implied in the forward-looking statements or on the basis of earlier trends can be expected. These factors include in particular, but are not limited to, the matters described in the chapter “Report on Risks and Opportunities” in the Annual Report of OSRAM Licht Group. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results, performance or achievements of OSRAM may vary materially from those described in the relevant forward-looking statement as being expected, anticipated, intended, planned, believed, sought, estimated or projected. OSRAM neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated. Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures they reference