On A Hostile Takeover
Martin Marinschek, Student ID 9803246
This paper summarizes the proceedings of the largest merger in the history of the telecommunication business, including the two players Vodafone and Mannesmann.
Analyzing the history of the two companies, the reasons for the merger, the merger itself and the outcome of the takeover, as well as the impacts on society, economy and legislative are the major concerns.
Along the way, a short description of the acting persons shall be given, and the environment of the merger shall be shown as appropriate for a complete description.
Table Of Contents
1An Introduction To The Case3
1.1Mannesmann Before The Merger3
1.1.1It All Began With Tubes3
1.1.2A Company In Change3
1.2Vodafone Before The Merger4
1.2.1A Pure Telecommunication Player4
1.2.2The Merger Vodafone – Airtouch4
1.3Compare The Price: Mannesmann And Vodafone5
1.4The Opponents: Klaus Esser And Chris Gent8
2The Proceedings Of The Merger9
2.1Mannesmann Wants Orange9
2.2Vodafone Wants Mannesmann9
2.3Mannesmann Fights With All Means9
2.4Vivendi: The White Knight?10
2.5Finally Vodafone Wins11
3The Future: Bright And Sparkling?11
3.1Vodafone – Mannesmann: The Biggest Player11
3.2Creating A New Brand: Forget About “Mannesmann”13
3.3The Impacts On Economy And Society13
3.3.1Impacts On Europe’s Economy13
3.3.2Impact On The Exchange Rate Of Currencies14
3.3.3Impact On Legislation14
3.4Two Winners Are Clear15
An Introduction To The Case
This chapter will tell about the essential information necessary to understand why the merger between Mannesmann and Vodafone could happen, and why a company like Mannesmann, one of the fastest growing German companies, was a takeover candidate.
1 Mannesmann Before The Merger
The foundations of Mannesmann and its history are the contents of this chapter.
1 It All Began With Tubes
It all began with tubes: in 1890 the "Deutsch-Österreichische Mannesmannröhren-Werke Aktiengesellschaft" was founded, due to the fact that an innovative process of manufacturing seamless tubes a lot cheaper caused a huge spark in the demand for such tubes. (Mannesmann. 2000. “An Outline of Mannesmann – History of the Mannesmann Group”.)
Later Mannesmann expanded its concept to play an important role in the field of Steel Engineering and the Automotive Industry as well. In 1990, it was a widely diversified group as the company history quotes.
“…In 1990, the hundredth year in the history of the company, Mannesmann is a widely diversified technological Group that successfully operates internationally in the sectors of mechanical engineering and plant construction, drive and control systems technology, electrical engineering and electronics, vehicle engineering as well as in the production and trading of the original product of steel tubing. This traditional sector, the Group nucleus, provides only around 28% of the sales in 1990 and the trend is steadily sinking…” (Mannesmann. 2000. “An Outline of Mannesmann – History of the Mannesmann Group”.)
2 A Company In Change
Finally, in 1990, the company bought the first licence for a private mobile telecommunications network in Germany, called its network D2 and rapidly grew to be the leader of the mobile communication business in Germany. (Mannesmann. 2000. “An Outline of Mannesmann – History of the Mannesmann Group”.)
The company was still active in other sectors as well, but these sectors started to be less important over time, the tube production sector was highly deficitary,...