ADVA Optical Networking SE: Agreement on Final Draft Domination and Profit and Loss Transfer Agreement with ADTRAN Holdings, Inc.

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EQS-Ad-hoc: ADVA Optical Networking SE / Keyword(s): Miscellaneous
ADVA Optical Networking SE: Agreement on Final Draft Domination and Profit and Loss Transfer Agreement with ADTRAN Holdings, Inc.

18-Oct-2022 / 19:09 CET/CEST
Disclosure of privileged information according to. in Article 17 MAR of Regulation (EU) No 596/2014, transmitted by EQS News – a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

ADVA Optical Networking SE: Agreement on Final Draft Domination and Profit and Loss Transfer Agreement with ADTRAN Holdings, Inc.

Munich, Germany, October 18, 2022.

ADVA Optical Networking SE’s Board of Directors (“ADVA”) and the Board of Directors of ADTRAN Holdings, Inc. (“ADTRAN Holdings”) today agreed to a final draft Domination and Profit and Loss Transfer Agreement with ADVA as the Controlled Company and ADTRAN Holdings as the Controlling Company. The domination and profit and loss transfer agreement (i) still requires the approval of the general meeting of ADVA, i.e. to approve the agreement on November 30, 2022, and (ii) must be entered in the commercial register at ADVA’s registered office. ADTRAN Holdings currently owns approximately 65.35% of ADVA’s shares. ADVA’s Supervisory Board today approved the draft agreement.

In the draft agreement, ADTRAN Holdings proposes to acquire the shares of the outside shareholders of ADVA against compensation (Abfinding) in cash in accordance with art. 305 of the German Joint Stock Company Act (Aktiengesetz – AktG”) in the amount of 17.21 euros per ADVA share. This amount is at the upper end of the ADVA per share value range calculated by a valuation in accordance with IDW S1 which was commissioned jointly by ADVA and ADTRAN Holdings and carried out by valuer ValueTrust Financial Advisors SE. ADVA’s Management Board and ADTRAN Holdings’ Board of Directors have agreed on the amount of the indemnity (Abfinding), in particular on the basis of expert opinion. The court-appointed auditor, the audit firm ADKL AG, has confirmed the appropriateness of the above-mentioned remuneration.

Cash compensation (Abfinding) exceeds the volume-weighted average trading price of the ADVA share of EUR 15.85 per share calculated by the Federal Financial Supervisory Authority (BaFin) during the three-month period up to July 5, 2022 included. This period is designated because ADVA had announced on July 6, 2022 that ADTRAN Holdings had approached ADVA to inform it of its intention to negotiate a domination and profit and loss transfer agreement with ADVA.

The domination and profit and loss transfer agreement also provides for an annual recurring indemnity (Ausgleichszahlung) to all outside shareholders of ADVA pursuant to Sec. 304 AktG in an amount of EUR 0.59 gross or EUR 0.52 net (after deduction of applicable corporation tax and the solidarity contribution) per share.

This compensatory payment (Ausgleichszahlung) is based on the intrinsic equity value of EUR 17.21 per ADVA share determined according to the current outlook on the valuation date and used as the basis for the remuneration (Abfinding) and an annuity interest rate equivalent to risk and maturity rounded (Verrentungszinssatz) 3.0%. However, it is possible that there will be changes in the interest rate environment due to increases in central bank interest rates by the extraordinary general meeting on November 30, 2022. This may result in changes in the annuity interest rate that is used to calculate the compensation payment (Asugleichszahlung). If on the day of the general meeting an annuity interest rate higher than 3.0% is to be used, this may lead to slight increases in the indemnity (Ausgleichszahlung). The parties have agreed specific amounts for annuity interest rates within a range of 3.25 to 5.5%. At a relevant annuity interest rate of 3.25%, the gross indemnity payment (Ausgleichszahlung) would amount to EUR 0.62 and, for a relevant annual interest rate of 5.5%, it would amount to EUR 1.00.

The domination and profit and loss transfer agreement as well as the joint report of the management board of ADVA and the board of directors of ADTRAN Holdings on the agreement, including the expertise of ValueTrust Financial Advisors SE and the report of audit of the auditor, ADKL AG, will be published on the Internet at https://www.adva.com together with the invitation to the extraordinary general meeting of ADVA.

Disclaimer
To the extent that the announcements contained herein contain forward-looking statements, such statements do not represent facts and are characterized by the words “will”, “expect”, “believe”, “estimate”, “have the ‘intent to’, ‘aim’, ‘assume’ or similar expressions. These statements express the current intentions, opinions or expectations and assumptions of ADVA and the persons acting jointly with ADVA. These forward-looking statements are based on current plans, estimates and forecasts, which ADVA and the persons acting jointly with ADVA have made to the best of their knowledge, but which they do not claim to be correct for the future. Forward-looking statements are subject to risks and uncertainties that are difficult to predict and generally cannot be influenced by ADVA or persons acting jointly with ADVA. These expectations and forward-looking statements may prove to be incorrect, and actual events or consequences may differ materially from those contained or expressed in such forward-looking statements.

Notifying person and contact for investors:

steven williams

Phone. : +49 89 890 66 59 18

[email protected]

Press contacts:

Gareth Spence

Such. : +44 1904 69 93 58

[email protected]

Oct 18, 2022 CET/CEST EQS distribution services include regulatory announcements, financial/corporate news and press releases.
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