Joint statement by the Board of Management and Supervisory Board in accordance with Section 27 of the German Securities Acquisition and Takeover Act (WpÜG)

Apr 15, 2011

  • The Board of Management and Supervisory Board welcome the tender offer from Engine Holding GmbH from a business perspective
  • The Board of Management and Supervisory Board do not consider the offer price appropriate
  • The Board of Management and Supervisory Board do not recommend that shareholders of Tognum AG accept the tender offer

Friedrichshafen, 15 April 2011. The Board of Management and Supervisory Board of Tognum AG today submitted their joint statement in accordance with Section 27 of the German Securities Acquisition and Takeover Act (WpÜG) on the voluntary public takeover offer published on 6 April 2011 by Engine Holding GmbH.

The Board of Management and Supervisory Board welcome the tender offer from Daimler AG and Rolls-Royce Group plc. from a business perspective. A successful takeover offer would further strengthen the company’s global technology leadership in propulsion systems and distributed energy systems.

The two Boards also welcome that core points of the cornerstone agreement of 9 March 2011 are reaffirmed by the tender offer of 6 April 2011. This applies in particular to the declared intention not to carry out any reduction in the core workforce at Friedrichshafen or other operating locations of Tognum AG and to retain Friedrichshafen as the headquarters and main research and development location.

After in-depth examination of the tender offer and appraisal of all relevant circumstances, however, the Board of Management and Supervisory Board are of the opinion that the offer price of EUR 24.00 per Tognum AG share is not appropriate.

In the opinion of the Board of Management and Supervisory Board, the offer price notably fails to reflect the capital expenditure carried out in recent years and the growth prospects for the Tognum Group that are associated with this capital expenditure alone. As key operating segments respond with a time lag to the recovery of markets since the global financial crisis, the Board of Management and the Supervisory Board also consider the long-term prospects to be reflected only to an inadequate degree. Nor is the offer price appropriate on the basis of Tognum AG’s long-term business plan.

Moreover, the offer price merely corresponds to the issue price at the time of the initial public offering of Tognum AG in July 2007. Between then and 31 December 2010, however, Tognum’s net debt has been reduced by some EUR 300 million.

The independent fairness opinions commissioned by the Board of Management and the Supervisory Board from Deutsche Bank and Lazard & Co. GmbH likewise come to the conclusion that the offer price is not appropriate.

The Board of Management and Supervisory Board therefore cannot recommend that shareholders accept the tender offer of EUR 24 per share.

Supplementary information

The Board of Management and Supervisory Board note that Tognum shareholders must each make their own decision whether to accept the tender offer and, if so, for how many Tognum shares, giving account to all relevant circumstances and their personal assessment of the company’s future performance, stock market share price and the value of Tognum shares.

The joint statement by the Board of Management and the Supervisory Board of Tognum AG in accordance with Section 27 of the German Securities Acquisition and Takeover Act (WpÜG) will be available for viewing in its entirety later today in the Investor Relations section of www.tognum.com. Tognum AG will also keep the statement available for viewing at the address Maybachplatz 1, 88045 Friedrichshafen, Germany. This will be stated in an information announcement in the Elektronische Bundesanzeiger (German Electronic Federal Gazette) on Monday, 18 April 2011.

It is expressly noted that the information provided in this press release does not explain or supplement the information provided in the joint statement and that solely the joint statement in accordance with Section 27 of the German Securities Acquisition and Takeover Act (WpÜG) is authoritative.

The statement is published in German and English. The German-language version is authoritative.

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Joint statement by the Board of Management and Supervisory Board in accordance with Section 27 of the German Securities Acquisition and Takeover Act (WpÜG)

Tognum Headquarters Friedrichshafen/Germany

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Joint statement by the Board of Management and Supervisory Board in accordance with Section 27 of the German Securities Acquisition and Takeover Act (WpÜG)

For 2011, Tognum expects a further increase in revenues and margins.

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Stefan Wortmann
Head of Communications and Sustainability
+49 7541 90-4350

stefan.wortmann@rrpowersystems.com

Dieter Royal
Investor Relations
+49 7541 90-3318

ir@tognum.com

Michael Frank
Investor Relations
+49 7541 90-3318

ir@tognum.com

Folker Dries
Press Contact
+49 151 16 23 15 56

fdries@heringschuppener.com

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