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Sell When You Can

05 April 2016 by lberuti

SHAEFF’s ( Schaeffler AG )founding family announced yesterday that they will sell 94.4m non-voting shares in Schaeffler AG. The sale consists in the disposal of their remaining non-voting stake in the company. It should yield about €1.24Bln that will go towards the reduction of some of the company’s liabilities. They did not give more clarifications as to what debt they will refinance. This sale completes the disposal that was scaled back when VW ( Volkswagen AG ) became embroiled in the emission cheating scandal and created volatility in the market. At the time, only 75m (out of the originally planned 166m) shares were floated in the IPO. The placement was hence not completely unexpected but the timing came as a surprise, in the sense it represents the earliest these remaining shares could have been listed (i.e. 6 months after the initial IPO). It sent the shares down 7%, but it is certainly a positive development for SHAEFF’s credit quality and the 5 year risk premium closed 7bps tighter at 231bps in an otherwise fairly weak market.