FAG Kugelfischer Georg Schafer AG (Schweinfurt, Germany) has
reported fiscal year 2001 financial results, down sharply
from 2000. The company had originally predicted sales and
earnings would be up 6% to 8% over 2000.
Net income fell to only € 3.1 million (USD $2.7 million),
on sales of € 2.224 billion ($1.96 billion), essentially
flat from 2000 sales of € 2.211 billion ($1.94 billion).
Expenses related to the company's ill-fated attempt to fight
off INA's hostile takeover drained off € 21.5 million
($18.9 million) earnings in only two months (September and
October 2001).
FAG did not estimate the other sales and business disruption
costs of fighting INA's bid - from lost sales due to customer
uncertainty about the company's future to the multiple internal
distractions of the takeover battle. Finally, this all took
place immediately following September 11 in what was already
a difficult economic climate.
The company also indicated that expenses related to its
stock option program had a major impact on earnings, but did
not break out the effect separately as of this announcement.
Status of INA Takeover
INA's takeover is progressing to conclusion, with the company
holding 89.6% of FAG's outstanding shares.
On June 6, 2002, at FAG's annual shareholder meeting, INA
will present a domination agreement (already ratified by
FAG's supervisory board) and a final buyout offer for all
FAG shareholder holdouts. The final offer is
€ 12 ($10.55) per share; holdouts who still refuse
even that offer will instead then begin receiving yearly
dividends fixed at € 0.79 ($0.69) per share.
FAG's formal annual report will be sent out on April 24, 2002.
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