StaRUG Proceedings
In the following you will find the most important questions and answers to the StaRUG proceedings of BayWa AG.
StaRUG-FAQs
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“StaRUG” is the abbreviation for the “Act on the Stabilisation and Restructuring Framework for Businesses”, which came into force in Germany on 1 January 2021 and offers companies a quick and targeted way of restructuring financial liabilities without the need for insolvency proceedings.
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Despite repeated requests, a small number of financial creditors have not yet agreed to the financing concept, meaning that the company no longer expects to be able to persuade these individual creditors to give their consent voluntarily.
The StaRUG proceedings make it possible to implement the financing concept and the content of the long-term reorganisation agreement even without the consent of these individual creditors and to include them in an overall solution with all financial creditors. The consent of 75% of the financial creditors is sufficient to proceed. This majority has already been secured contractually.
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The StaRUG proceedings as applied by BayWa AG are a kind of “StaRUG light”, it only affects the financial creditor side and are therefore not comparable with other StaRUG cases known in Germany. In particular, shareholders do not lose their shareholding. There will be no capital reduction and the shareholders will have subscription rights to the new shares in the planned cash capital increase in proportion to their existing shareholding.
The financial creditors will also not be subject to any debt waivers in the “StaRUG light” proceedings. The financing concept essentially provides for the term of the loans to be extended until the end of 2028.
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The StaRUG proceedings offer legal certainty and strengthen the company’s going concern forecast.
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No, they relate solely to BayWa AG.
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The StaRUG proceedings have no impact on customers, suppliers and employees.
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Yes, the uniform cash capital increase planned as part of the financing concept in two tranches with subscription rights for all BayWa AG shareholders with a volume of up to €201.6 million, but at least €150 million, is to be approved to simplify and accelerate the process as part of the StaRUG proceedings.
In the context of the first tranche, the two major shareholders are to be entitled to subscribe in accordance with their previous shareholdings in the company. In the context of the second tranche of the capital increase, all shareholders except the two major shareholders are then to be entitled to subscribe in accordance with their previous shareholdings in the company after the completion of the securities prospectus required for this purpose.
For capital market reasons, the capital increase will be carried out in two tranches. This will enable BayWa AG to benefit at an early stage from the capital injection of the two major shareholders, while also ensuring that – once the necessary securities prospectus has been prepared and approved – all free-float shareholders can participate in the capital increase in the same way as the major shareholders, in line with their previous shareholdings. The fact that the two major shareholders have signed voting rights waiver agreements ensures that they will not exercise their voting rights from the new shares as long as the free float shareholders are unable to exercise their subscription rights.
BayWa AG's two major shareholders have undertaken to secure the capital increase of €150 million.The cash capital increase is to be decided via the StaRUG proceedings.
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Other than the opportunity for all shareholders to exercise their subscription rights in the planned cash capital increase and to subscribe to shares in BayWa AG, no material measures under company law are planned for the shareholders as part of the StaRUG proceedings. Specifically, existing shareholders will not be forced out of the company in a capital reduction.
On the contrary: by being able to exercise their subscription rights as part of the planned capital increase, shareholders will have the option to continue to participate and benefit from a successful reorganisation of the company.
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The StaRUG proceedings have no bearing on the stock exchange listing of BayWa AG shares. The shares will continue to be traded on the existing stock exchanges.
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Yes.