NEWSMAKER-Esser seen winning whatever result of Vodafone bout
By Paul Carrel
FRANKFURT, Feb 1 (Reuters) - Win or lose, Mannesmann AG Chief Executive Klaus Esser has emerged from his battle with Vodafone AirTouch Plc (quote from Yahoo! UK & Ireland: VOD.L) as one of a new breed of German executives dedicated to shareholder value.
That, observers say, is a trait that has boosted his personal stock value along with Mannesmann's share price and should secure him a plum job whatever the outcome of the mammoth corporate tussle.
``He is extremely highly regarded in the telecoms industry. He would get a new offer in no time,' said Theo Kitz, analyst at Merck Finck & Co in Munich.
SEEKING BEST DEAL FOR SHAREHOLDERS
Having transformed Mannesmann from an engineering firm to one of Europe's most exciting telecoms companies, Esser has shown a steely determination to ensure the best possible deal for his shareholders in the face of the Vodafone bid.
Esser initially capitalised on a wave of national discontent at the idea of Mannesmann, one of Germany's grandest industrial concerns, being taken over by a foreign firm -- a prospect that won Chancellor Gerhard Schroeder's support for the defence.
But he has since plotted a measured defence, coolly outlining his strategy for delivering faster growth than he believes Mannesmann shareholders would enjoy under a merged group.
``My view is that he's got better over the period,' said one London-based analyst who asked not to be named. ``The German parochialism card he played initially didn't go down well. Esser has, over the course of time, become more investor friendly.'
Esser has argued that Mannesmann's integrated mobile, fixed-line and Internet strategy will deliver more than 30 percent profit growth annually over the next three years compared to 18 percent offered by Vodafone.
This has not convinced all observers.
``The argument that Mannesmann is growing faster does not really hold because it's a less mature business than Vodafone,' said one London-based analyst.
But by using the growth forecast to insist that Mannesmann shareholders would have to gain the majority of a merged group, Esser has given himself a strong position with which to bargain.
ESSER TAKES ``GERMANY AG' INTERNATIONAL
With an estimated 60-plus percent of Mannesmann shareholders based outside Germany, Esser has matched Vodafone chief Chris Gent in the jet-setting world and has been a role model for a modernised ``Germany AG' in his visits to investors around the globe.
Many analysts now regard Mannesmann and software group SAP AG as leaders in delivering shareholder value in Germany.
Since his appointment last May, Mannesmann's share price has risen some 135 percent, outpacing a 35-percent rise in Germany's blue-chip DAX index.
Much of Germany's corporate landscape remains marked by cosy relationships between managers, the state and workers councils, more suited to post-World War Two reconstruction than the cut-and-thrust of modern international business.
But Esser has shown he is capable of jousting with Gent, who is well versed in the sometimes aggressive tactics of British and U.S. businesses.
A fluent English speaker, Esser's time spent studying business at the Massachusetts Institute of Technology and practising law in New York prepared him well for the landmark takeover battle.
And while a narrowing this week of the spread between Vodafone's all-share offer and Mannesmann's stock price shows the market believes Vodafone's offer is increasingly likely to succeed, some analysts say Mannesmann could yet scupper the British group's bid.
``I think one should not underestimate Esser,' said Merck Finck's Kitz. |
