In light of Fanatecs recent positive announcement regarding the release of a new wheel rim for the podium module, several developments are still ongoing regarding Corsairs potential takeover of the company.
Recent headlines and reporting from the sim racing community has cast doubt on the integrity in which the proposed takeover has been handled. A recent post made on Fanatecs own social media account by a group calling themselves the “Fanatec Rebel Alliance” suggested this could be the case. The post read as though it was made by a group of former board members or management within Fanatec ranks. However, to the best of my knowledge, this is unconfirmed. The post went on to claim the takeover was “hostile” that the company had been “kidnapped by a big American corporation” and “this could happen to any business owner”. Naturally, this post was removed within minutes and now only exists with the few people who managed to capture a screenshot beforehand.
Several questions remain. Is the process in which the takeover is occurring, legal? Is it fair? And who stands to lose out in this situation? We will try and summarise (in a light-hearted way), the most recent news in this article below.
How Fanatec Plans to Restructure
Endor AG (Fanatec) Since canning its former CEO, Thoms Jackermeier, have been in negotiations regarding its plans to restructure the company and avoid entering insolvency. The Management Board, along with approval from lending banks and the Supervisory Board, has agreed on specific actions with the PC hardware titans and mass producers of RGB, CORSAIR®. YAY!!!
These actions see Corsair providing interim financing to Endor AG. This funding will be delivered in stages in the short term, aligning with the company’s financial needs. Endor AG views CORSAIR® as a dependable partner. They not only have the financial capability but also understand Endor’s market (Sim Racing/Computer Hardware) and are committed to long-term investment in the company. Sounds like a perfect match, doesn’t it?
After reviewing various restructuring proposals, the lending banks decided to support CORSAIR®’s offer. They believed it was the most viable option to prevent Endor AG from facing insolvency. That’s great news isn’t it…………. Or is It?
Basically, at this point the always friendly bankers, Endor AG’s (Fanatec) interim board and Corsairs financial boffins decided the best way forward would be to restructure under the German Act on the Stabilisation and Restructuring of Companies (StaRUG) due to the imminent risk of insolvency. This process aims to reorganise the company’s finances and operations without needing to declare insolvency formally.
“Reorganise” that’s a great word, isn’t it? what could that possible mean? Does that mean there is a “BREAK IN CASE OF EMERGENCY” piggy bank with a few million Franks spare somewhere? That would be a nice simple fix, wouldn’t it? Something tells me that’s not the case though. It’s probably something more sinister……. Let’s read on and find out.
On June 3rd, 2024, Endor AG informed a special court in Munich about their plan to restructure under StaRUG. As a result of the proposal, CORSAIR® will acquire Endor AG completely and provide sufficient financial resources to stabilise the company. This approach avoids the need for additional external debt, which currently amounts to approximately EUR 70 million ($112,350,000.00 AUD). GOOD GREIF! That’s a lot of unfinished Bently rims!
Right, well now we have arrived at the interesting part. We alluded to the claims made earlier in the article, that question the legality and fairness of the way this takeover has unfolded. To this point, everything appears “above board” however, when you look at the restructuring plan submitted to the courts, ethical questions may arise. A brief summary of the plan posted on EQS News looks like this:
- ‘The lending banks will forgive some of the debt that is owed by Endor AG (Fanatec).’
Sweet, can I have 100k off my mortgage as well please Mr kind banker?
- “a reduction in the company’s total capital, which means the current shareholders will lose their shares without getting any money in return.”
This point right here is the most heartbreaking. Investors, shareholders, effective stakeholders which could be any loyal Sim Racer who enjoyed Fanatec products and chose to invest in the company as a way of support, could be removed without a trace or compensation.
- Endor AG’s shares will be removed from the public stock market.
This will ensure Corsair completes a 100% takeover of Endor AG by removing current shareholders who may potentially have a say or need to be consulted in how the company is managed moving forward. Not only will they be removed, but it also eliminates the potential for further investment from threats to Corsairs takeover of the company.
- Endor AG will continue to update investors and the public about what’s happening.
Thanks, Endor!
How does that sit with you?
It’s easy to understand the claims that this method of takeover is “unethical”. However, to my understanding, that does not make it illegal. Certainly not under German law anyway. And why would we have any reason to doubt them? The claims that “this could happen to any business” also appear in theory to be true, if the “StaRUG” method is used and accepted in a German Court. In the meantime, we will wait to hear the official verdict from the courts on this one!
If you’re interested in keeping up to date with all announcements made from Endor AG regarding the future of Fanatec, then you can find the latest information at EQS NEWs.
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