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voestalpine AG / Report of the Management Board of voestalpine AG in accordance with § 171 (1) in conjunction with § 153 (4) Austrian Joint Stock Corporation Act

Published: March 6, 2017; 10:50 · (Vindobona)

In accordance with § 169 Austrian Joint Stock Corporation Act [AktG] the general meeting of shareholders of voestalpine AG held on July 2, 2014 authorized the Management Board to increase the company's capital up to EUR 31,330,923.02 on or before June 30, 2019, if necessary in several tranches, by issuing up to 17,244,916 bearer shares, in exchange for contributions in kind and/or cash contributions under exclusion of the subscription rights of shareholders to be made available to employees, executives and members of the Management Board of the company or a company affiliated with the company, under an employee shareholding scheme.

voestalpine AG / Report of the Management Board of voestalpine AG in accordance with § 171 (1) in conjunction with § 153 (4) Austrian Joint Stock Corporation Act / Picture: © Vindobona

 

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Company Information/Management Report concerning 0.8 % capital increase

1. General

In accordance with § 169 Austrian Joint Stock Corporation Act [AktG] the
general meeting of shareholders of voestalpine AG held on July 2, 2014
authorized the Management Board to increase the company's capital up to EUR
31,330,923.02 on or before June 30, 2019, if necessary in several tranches, by
issuing up to 17,244,916 bearer shares, in exchange for contributions in kind
and/or cash contributions under exclusion of the subscription rights of
shareholders to be made available to employees, executives and members of the
Management Board of the company or a company affiliated with the company, under
an employee shareholding scheme. The procedure, the issue price and the terms
of the issue as well as any exclusion of the subscription rights are to be
determined by the Management Board of voestalpine AG in agreement with the
Supervisory Board. The Supervisory Board is authorized to make any changes to
the Articles of Association of the Company resulting from the issue of shares
from authorized capital (see § 4 (2b) of voestalpine AG's Articles of
Association as in force on July 6, 2016). The Management Board has exercised
this power so far once with resolution of the Management Board on the
utilization of authorized capital as of March 9, 2015 as the company's capital
was increased by EUR 4,542,052.14 to EUR 317,851,287.79 by issuing 2,500,000
new bearer shares.

2. Resolution of the Management Board

Pursuant to the authorization referred to in section 1 and subject to the
agreement of the Supervisory Board, on March 6, 2017 voestalpine AG's
Management Board resolved to increase the company's capital, currently totaling
EUR 317,851,287.79, by EUR 2,543,549.20 to EUR 320,394,836.99, by issuing
1,400,00 new bearer shares entitled to participate in dividends as from April
1, 2016 ('Capital Increase'). This constitutes a 0.8% (rounded) increase in the
Company's registered capital. The issue price was fixed at EUR 39.93 per share,
to be fully paid in and in cash. The issue price for the shares corresponds to
the voestalpine AG share's closing average market price over the 5 trading days
prior to the resolution of Management Board taken on March 6, 2017. Shares from
the capital increase may only be acquired by the shareholder voestalpine
Mitarbeiterbeteiligung Privatstiftung, which is subject to the obligation to
hold these shares in trust pursuant to the provisions of the voestalpine
employee shareholding scheme for the employees and executives of voestalpine AG
or any of its affiliated companies participating in the voestalpine employee
shareholding scheme. The subscription rights of all other shareholders were
excluded.

3. Exclusion of shareholder subscription rights

Employees are the most important assets of any company. Economic success cannot
be achieved without their positive contribution. This is the reason why as
early as 2000, voestalpine launched an employee shareholding scheme which has
subsequently been expanded continually. Currently voestalpine
Mitarbeiterbeteiligung Privatstiftung holds 12.92% of voestalpine AG's capital.
Additionally, voestalpine Mitarbeiterbeteiligung Privatstiftung manages
approximately 1.2% of private shares of present and former employees. Employee
participation in voestalpine means that voestalpine AG has a stable
shareholder. It also strengthens employee loyalty towards the company, and as
shareholders employees profit from its success. Employee participation in
voestalpine is essentially based on the utilization of portions of the wage and
salary increases resulting from collective bargaining agreements to allocate
shares in voestalpine AG. As a first step in this process, shares are acquired
by voestalpine Mitarbeiterbeteiligung Privatstiftung, which holds them in its
own account. The second stage is the annual allocation of shares to employees,
taking account and making use of tax benefits as appropriate. The shares
allocated to employees are held by voestalpine Mitarbeiterbeteiligung
Privatstiftung for the employees in custodial accounts specifically opened for
the employees. Voting rights for all shares held by voestalpine
Mitarbeiterbeteiligung Privatstiftung (own account, custodial accounts) are
exercised by voestalpine Mitarbeiterbeteiligung Privatstiftung, with employees
being entitled to receive dividends from shares already allocated to them. If
employees participating in the employee shareholding scheme leave the
voestalpine Group for any reason (e.g. retirement), they will receive the
shares that have been held for them in trust by voestalpine
Mitarbeiterbeteiligung Privatstiftung, to do with as they wish. The number of
voestalpine AG shares held by employees under the employee participation scheme
is therefore not constant but decreases as a result of staff fluctuations, as
happens in every company. The 0.8% (rounded) capital increase is being carried
out in order to ensure that the level of employee participation in voestalpine
AG capital is at least 10% - a basic objective pursued by both the Management
Board and the company's employees. In addition, the capital increase will
(initially) increase employee participation in voestalpine AG's capital to
13.61% (plus approximately 1.19% of private shares). This level of
participation will decrease in the future, in line with staff fluctuations in
the voestalpine Group, unless voestalpine Mitarbeiterbeteiligung Privatstiftung
acquires additional voestalpine AG shares under the employee shareholding
scheme. Under § 153 (5) of the Austrian Joint Stock Corporation Act [AktG],
preferential issue of a company's shares to employees, executives and members
of the Management Board of the company or any of its affiliated companies is
sufficient grounds for excluding the subscription rights of shareholders.
Furthermore, exclusion is justified on factual grounds, since

(i) for the reasons set forth above, both the employee shareholding scheme and
measures to safeguard it are in the interests of voestalpine AG,
(ii) exclusion of shareholder subscription rights in connection with the
capital increase is likely to achieve the aim of safeguarding the
voestalpine employee shareholding scheme and there is no other way to do
so in a similarly efficient way without excluding these shareholder
subscription rights, and (iii)exclusion of shareholder subscription rights
is proportionate. As the increase of capital stock is relatively modest,
the Management Board is of the opinion that the position of minority
shareholders will be scarcely, or only slightly, affected and no new
majority positions will arise. Shareholders will not incur any proprietary
disadvantages, since the amount at which each share will be issued
corresponds to the voestalpine AG share's closing average market price
over the 5 trading days prior to the resolution of Management Board taken
on March 6, 2017. Using this average market price will ensure that the
amount at which each share is issued corresponds to the company's
valuation on the stock exchange. In addition there is no substantial
danger of diluting the shareholders' membership rights since the company's
shares are highly liquid and shareholders are able to acquire the
company's shares in the capital markets at any time in volumes that
compensate for their diluted voting rights. Overall, exclusion of
shareholder subscription rights is justified on factual grounds.

Linz, March 2017

The Management Board

This report of the Management Board is a translation of the German report
called "Bericht des Vorstands der voestalpine AG gemäß § 171 Abs 1 iVm § 153
Abs 4 AktG". In any case the German report shall be binding. This translation
is for information purposes only.

Further inquiry note:
DI Peter Fleischer
Head of Investor Relations
Tel.: +43/50304/15-9949
Fax: +43/50304/55-5581
mailto:peter.fleischer@voestalpine.com
http://www.voestalpine.com
end of announcement euro adhoc

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company: voestalpine AG
voestalpine-Straße 1
A-4020 Linz
phone: +43 50304/15-9949
FAX: +43 50304/55-5581
mail: IR@voestalpine.com
WWW: www.voestalpine.com
sector: Metal Goods & Engineering
ISIN: AT0000937503
indexes: WBI, ATX Prime, ATX
stockmarkets: official market: Wien
language: English

Digital press kit: http://www.ots.at/pressemappe/2054/aom

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