Würth Group to launch a public tender offer for TIM shares. Major shareholders of TIM have already committed to tender their shares

The Würth Group, global market leader in the development, production, and sale of fastening and assembly materials, and, with its Electrical Wholesale business unit, one of the leading electrical wholesalers in Central and Eastern Europe, intends to acquire TIM S.A. (the “Company”), the largest distributor of electrical equipment in Poland. The Würth Group intends to launch a public tender offer for all shares of TIM S.A. (the “Offer”).

Major shareholders including TIM’s CEO Krzysztof Folta have already signed agreements pursuant to which they undertake to tender their shares to the Offer. Following a successful Offer, Würth Group intends to support TIM S.A. in its further growth. TIM will become an integral part of Würth Group’s Electrical Wholesale business unit and will continue to operate under the current management team on a standalone basis.

The Offer price will be PLN 50.69, representing a premium of 34.1%, 51.7% and 67.0% to the last closing price of the Company’s shares preceding day of this announcement, the 3-month volume-weighted average price and the 6-month volume-weighted average price of the Company’s shares preceding such date, respectively. The Offer price also represents a premium of 93.8% to the last closing price before the announcement by the Company of its strategic options review on 22nd August 2022.

The transaction begins a new phase in the 35-year history of TIM S.A., the leader in the still fragmented Polish market for the distribution of electrotechnical products, operating Poland’s largest B2B e-commerce website TIM.pl. The Company has been listed on the Warsaw Stock Exchange since 1998.

The planned Offer results from the strategic options review conducted by TIM S.A. The process was carried out in accordance with best market practices and the support of reputable financial and legal advisors. After analyzing possible courses of action, to maximize value for TIM S.A. stakeholders, the Company has concluded that partnering with the Würth Group is the most favourable option.

– This transaction represents another significant milestone in the history of TIM Group, while also confirming the substantial value that the management teams and all employees have built over the years. Joining the Würth Group will strengthen TIM strategically and pave the way for expansion into new areas. It was of paramount importance to us that the agreed offer price is highly attractive for the existing shareholders and that the Würth Group will support the continued dynamic growth of the businesses of both TIM Group companies – comments Krzysztof Folta, TIM S.A. CEO.

– We are impressed by the development of TIM Group, particularly in the areas of e-commerce and operational efficiency. Combining forces in the electrotechnical wholesale market in Poland will help us to achieve our strategic goals, and provide us with even greater exposure and know-how in e-commerce. We recognize the value of TIM, which is why we decided to offer a significant premium compared to the average trading price in recent months. The attractiveness of our proposal is evidenced by the commitment of the Company’s management and largest shareholder to sell their shares. Appreciating TIM’s strong corporate culture which is similar to ours as well as the outstanding commitment of the Company’s employees to growth and innovation, we want to make sure that the business will continue its successful expansion. Therefore, we intend to strongly support the current management team in the execution of our common strategy – comments Ulrich Liedtke, Executive Vice President of the Würth Group responsible for the International Electrical Wholesale.

Some of the largest shareholders and key managers of the Company, jointly representing approximately 42% of the total number of shares in the share capital and total number of votes in TIM S.A., have signed agreements with Germany based FEGA & Schmitt Elektrogroßhandel GmbH, a company belonging to the Würth Group, which will act as the offeror under the Offer (the “Offeror”). Under these agreements, Krzysztof Folta (CEO and founder of TIM S.A.), Krzysztof Wieczorkowski (chairman of the supervisory board of TIM S.A.), Piotr Tokarczuk (CFO of TIM S.A.), Piotr Nosal (CCO of TIM S.A.), Maciej Posadzy (CEO of 3LP S. A.), Ewa Folta and Jan Walulik are obliged to subscribe to the planned Offer at the agreed price of PLN 50.69 per share. It was further agreed that the composition of the boards of directors of TIM and 3LP would remain unchanged to allow them to continue the implementation of their existing strategies with the support of the Würth Group.

If, as a result of the Offer, the threshold of at least 95% of the total number of votes at the general meeting is achieved, the Offeror intends to announce a squeeze-out of the shares held by the remaining Company’s minority shareholders. Subsequently, in accordance with the applicable provisions of the law, the Offeror intends to delist the company from the Warsaw Stock Exchange.

mBank S.A. and mInvestment Banking S.A. act as M&A and financial advisors to TIM S.A. and DLA Piper as legal advisor.

BNP Paribas is the exclusive financial and M&A advisor to the Würth Group, while Domański Zakrzewski Palinka sp.k. is the legal counsel. EY performed financial and tax due diligence. Santander Bank Polska S.A. – Santander Biuro Maklerskie acts as intermediary broker and transaction advisor under the tender offer for Würth Group.

 

Würth Group
The Würth Group is the global market leader in the development, production, and sale of fastening and assembly materials. Other trading and production companies, known as the Allied Companies, operate in related business areas, ranging from electrical wholesale and electronics to financial services. The Group employs more than 85,000 employees in over 400 companies with more than 2,500 pick-up shops across 80 countries. According to the preliminary annual financial statements, the Group generated sales of EUR 19.95 billion in the 2022 fiscal year.