Paul Singer's Elliott takes stake in takeover target Uniper
* Elliott stake comes amid planned takeover by Fortum
* E.ON can sell its stake to Fortum for 22 euros/shr
* Uniper shares close up 3.9 pct after hitting record
(Recasts, adds context on E.ON-Fortum deal, shares)
By Christoph Steitz and Ludwig Burger
FRANKFURT, Dec 5 (Reuters) - Activist investor Elliott
Management has taken a 5.32 percent stake in Uniper,
putting pressure on Finland's Fortum to sweeten its
8.05 billion euro ($9.51 billion) takeover offer for the German
The bet marks Elliott's latest foray into Germany's M&A
arena after the fund took a stake in drugmaker Stada
and successfully extracted a higher offer for the group from
private equity firms Bain Capital and Cinven.
Elliott's stake in Uniper comprises a voting equity stake of
2.39 percent, with a further 2.93 percent held through
unspecified instruments, Uniper said on Tuesday.
The stake is worth 480 million euros based on Uniper's
closing share price on Monday.
The move comes ahead of plans by E.ON, Uniper's
former parent, to tender its remaining 46.65 percent stake in
Uniper to Fortum for a fixed price of 22 euros per share by Jan.
Fortum last month submitted a bid for the whole of Uniper to
comply with German takeover rules. Uniper's management rejected
the offer, saying it substantially undervalued the group and
made no strategic sense.
Fortum, which has a strong focus on clean technologies as
opposed to Uniper's exposure to coal- and gas-fired power
plants, previously said that its primary aim was to acquire
E.ON's stake in Uniper. It has ruled out an increased offer.
Fortum, 50.8-percent state-owned, was not immediately
available for comment. Elliott declined to comment.
Uniper's shares closed 3.9 percent higher at 25.88 euros on
Tuesday after earlier hitting 25.995 euros, their highest level
since the group's listing in September 2016.
E.ON can still withdraw from its deal with Fortum but that
would trigger a hefty 1.5 billion euro compensation payment,
making it difficult for E.ON to pull out unless Uniper's shares
rise above 30.80 euros.
E.ON, which spun off Uniper to focus on renewables, networks
and power retail operations, confirmed on Tuesday it would make
a final decision on the sale of the Uniper stake in January.
Elliott's strategy of pushing for higher offers in takeover
situations has not always worked out. General Electric
last year walked away from a 683 million euro bid for German 3D
printing gear maker SLM Solutions after Elliott, which
had a stake in SLM, said it would reject the bid.
($1 = 0.8464 euros)
(Additional reporting by Tuomas Forsell in Helsinki and Maiya
Keidan in London; Editing by Douglas Busvine and Jane Merriman)
First Published: 2017-12-05 18:27:03
Updated 2017-12-05 20:08:37
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