Topic: KKR announced that all offer conditions are met and the transfer of shares for Sept. 6th.

Belgian FDI approval: Following Germany's FDI approval from May '24, Belgium has also given green light for KKR's takeover of OHB's free float. This was anticipated as early as Sept. '24 (see update from Aug. 8th) as Belgium's FDI authority has only started to look into the case after Germany. This was the last remaining offer condition that needed to be fulfilled before the long-stop date (Sept. 30th 2024) in order for the tender offer to go through.

Transfer of shares on Sept. 6th: According to the offer document, KKR will now pursue the transfer of shares against a € 44 per share cash settlement latest after 8 banking days (i.e., Sept. 9th), but plans to execute the transfer on Friday, Sept. 6th.

New shareholder structure post share transfer: Following the transfer, OHB will be controlled by the Fuchs Family (65.35%) and KKR (28.64%). Together they will thus hold 93.99% of shares. Excluding treasury shares (0.33%), that are not equipped with voting rights, Fuchs Family and KKR will thus make up 94.3% of voting rights, which is only 0.7% short of the squeeze-out (SO) threshold of 95% of voting rights. - see p. 2 for details

Filling the gap to 95%: We deem it likely, that KKR will acquire the missing 0.7% either from the remaining free float (4.91%) or from the special situation fund SYQUANT (0.78%) to overcome the SO threshold. As the free float shares are trading at low volumes, an OTC block trade seems more likely in our view.

Delisting and SO at once, but not in the short-term: Given that KKR and Fuchs Family have no time pressure to pursue the delisting, we expect them to wait for the SO threshold to be reached before the final decision to delist, which will likely not fall before the next AGM in mid-2025.

Recommendation: The remaining free float shareholders should avoid the risk of owning an illiquid stock in the upcoming delisting for which a SO seems very likely. Therefore, we recommend to SELL at current levels (yesterdays closing price of € 45.90 above the € 44.00 offer price) while one still can.

- Coverage discontinued -