BERLIN (Bloomberg) – Daimler AG and Rolls-Royce Group Plc see "no reason" to raise their joint takeover offer for Tognum AG, Daimler's CFO Bodo Uebber said.
The bid of 24 euros per share "is our price," Uebber told Bloomberg News Friday. "We are sticking to that."
Daimler and London-based engine maker Rolls-Royce offered March 8 to buy the company in a deal valuing the heavy-duty engine manufacturer at 3.2 billion euros ($4.41 billion). The bid is 30 percent higher than Tognum's March 4 closing price, the last trading day before the companies expressed their interest.
The shares have traded above the offer price since Tognum said it had not agreed with Rolls-Royce and Daimler on a price. Some investors have said they expect the bid to be increased. Juergen Siebrecht, an analyst with HSBC, said in a note today that 29 euros per share would be a "fair takeover value."
Daimler and Rolls-Royce can hold firm with their offer because Daimler's current 28.4 percent holding allows them to block any effort by other potential suitors for the company. Under German law, shareholders with more than 25 percent of a company have the power to veto any major strategic moves.
"We have time," Uebber said. "We already own 28.4 percent of Tognum and aim for 50 percent plus 1 share. We are going to get there."
Tognum fell as much as 1.6 percent to 25.10 euros and was down 0.9 percent to 25.28 euros as of 11:29 a.m. in Frankfurt trading, valuing the company at 3.32 billion euros.
Daimler and Rolls-Royce are offering 16.5 times earnings before interest and taxes for Tognum. Acquirers paid a median of 13.25 times Ebit for assets in the auto- and truck-parts industry in the past five years, according to Bloomberg data.
"Both Rolls and Daimler see no reason at all to change anything about the price," Uebber said. "For every Tognum shareholder, this offer is a unique opportunity."
Tognum, which makes engines for ships, tanks, and power generators, reported a 39 percent drop in 2010 net income to 63.2 million euros. Profit was negatively impacted by a 60 million-euro charge for discontinuing fuel-cell operations, which may be transferred to Rolls-Royce in the deal.