Following a final verdict reached on November 17, 2009 by the higher regional court in Frankfurt am Main, Daimler AG (stock-exchange abbreviation DAI) will increase the settlement and compensation to be made to the former AEG shareholders.
The domination and profit and loss transfer agreement between the former Daimler-Benz AG and AEG AG from the year 1988 specified an exchange ratio of 5 AEG shares for one old Daimler-Benz share. In its verdict of November 17, 2009, the court specified an appropriate ratio of 2.9 AEG shares for one old Daimler-Benz share.
The compensation for foregone AEG dividends foreseen in the domination and profit and loss transfer agreement will increase accordingly. Instead of compensation of 20 percent of the Daimler dividend per old AEG share, the higher regional court has determined that 34.5 percent of the Daimler dividend is appropriate.
From today’s perspective, the court’s verdict will result in a maximum obligation for Daimler to supply 4.3 million Daimler shares and a maximum amount of 150 million euros in cash for dividends and compensation payments. The actual amount will depend, however, upon how many claims are made by eligible former AEG shareholders. Daimler has recognized provisions in its balance sheet to satisfy the claims, but the provisions are now being reviewed once again for the year-end financial statements.
Daimler intends to use treasury shares to meet these obligations.
From the share buyback program carried out in 2008, Daimler currently holds 37.1 million own shares, which were originally acquired for the purpose of redemption without reducing the share capital and possibly also to serve the stock option plan.
