Software AG minority investor groups to oppose Silver Lake delisting

Software AG

16/05/2023 18:22

By Emma-Victoria Farr
       FRANKFURT, May 16 (Reuters) - Two associations
representing minority investors in Software AG  SOWGn.DE  said
they will speak out against suitor Silver Lake's plans to delist
the company at a shareholder meeting on Wednesday, on concern
about the impact on smaller shareholders.
    Private equity firm Silver Lake has offered to buy Software
AG for 32 euros per share, valuing the German software developer
at 2.37 billion euros ($2.61 billion) and said it plans to take
the company private.
    Software AG has backed the Silver Lake offer despite a
higher 34-euro a share non-binding bid coming in from
Bain-backed Rocket Software earlier this month. 
   Some investors argue that the Silver Lake offer undervalues
Software AG and that minorities never fare well in delistings.
    While a vote regarding the delisting is not on the agenda at
Wednesday's AGM, investor association SdK said it will vote
against related topics, such as the reduced company dividend, to
express its disagreement with the Silver Lake plan.
    "A delisting is a red flag for minority shareholders," said
SdK board member Andreas Schmidt.
    He said it seemed the meeting's topics, such as a reduced
dividend and suggestion for future AGMs to be held only
virtually, were a step to forcing the remaining free
shareholders out of the company.
    "A possible delisting would be a hard cut for private
investors, some of whom have been invested for many years," said
lawyer Wolfgang Schaerfe, who will represent shareholder
association DSW at the AGM.
    Software AG has faced criticism from shareholders over its
handling of the sales process. London-based Schroders, the
company's largest outside shareholder which owns 8%, said Silver
Lake's offer "materially undervalues the company".
    SdK's Schmidt plans to ask management whether all offers
were discussed and assessed adequately in advance.
    Software AG, Rocket Software and Silver Lake all declined to
comment.  
($1 = 0.9084 euros)

 (Reporting by Emma-Victoria Farr
Editing by Christoph Steitz and Sharon Singleton)
 ((emma-victoria.farr@thomsonreuters.com;))