Corporate restructuring of an energy group

• Management of project team
• Close consultation and cooperation with Group Project and external advisors

• At Group level change of shareholder from an international investment organization (EQT Group, Stockholm/Sweden) to an US investment bank (JP Morgan, USA)
• Necessity to create a new Group holding structure and legally separate country platforms/subgroups to maximize business growth
• Need to optimize Group structure for controlling, shareholder distribution and debt financing purposes

• At level of platform Germany: Legacy and inappropriate structure of the sub-group with a huge number of companies and an excessive complexity
• Too much ballast within the organization to be able to carry out effective change, lean and innovation management
• Need to reduce the number of legal entities especially through mergers to an economically reasonable and sustainable level

• Project Management (external) Group Reorganization

• Review of the legacy corporate structure of the subgroup of G+E GETEC Holding GmbH, Magdeburg, with regards to the planned reduction in the number of operating companies, in particular through mergers
• Implementation of a feasibility study according to subject areas and documentation of the results, with the aim of identifying opportunities/risks, problems, obstacles and “critical issues” with sufficient certainty and making reliable statements about a future target structure
• Identification of potential networking and synergies in the functional areas of the companies and a reduction in complexity and transaction costs
• Development of an optimised target structure (TAM: Target Architecture Model) in compliance with legal requirements and subject to constraints z. B. DrittelbG)
• Close cooperation with the group project and development of a strategy for the implementation of the new Germany platform
• Preparation of management instruments (e.g. project plan; work breakdown structure; MS project)
• Development of a field-tested concept regarding the consolidation of Finance, Accounting and Controlling systems (Navision/SAP; LucaNet) from a technical perspective, in a clear time frame and in coordination with auditors and internally responsible persons

2.) Reduction of the number of operating companies from the original ten to five predominantly large corporations on platform Germany

3.) Establishment of a leaner structure/streamlining the organization:

• Significant reduction of general administration and transaction costs
• Realization of potential networking and synergies
• Freeing the organization from “ballast“
• Enabling of “Fast Close“ and shorter reporting cycles
• Improvement of both data quality and quality of business decisions

4.) Improving the organization’s ability to achieve goals reliably, overcoming uncertainties and acting with integrity (Corporate Governance; GRC: Governance, Risk & Compliance)

Great coordination effort: Close connection and mutual dependencies between group project and sub project platform Germany

Labor and works constitution law topics, including:

• Supervisory Board (§ 1 DrittelbG; One-Third Participation Act)
• Change in operations/other works council involvement (§ 111 BetrVG; works constitution act)
• Balance of interest and social plan (§ 112 BetrVG; works constitution act)
• Transfer of operations (§ 613a BGB; German Civil Code)

Tax consequences from the target structure:

• Tax group relationships, e.g. VAT Group and management boards
• RETT: Real Estate Transfer Tax: Tax concession Group clause (§6a GrEStG; Real Estate Transfer Tax Act)
• Binding information tax authorities (§ 89 Abs. 2 AO; German Fiscal Code)
• Implementation as planned and in correct sequence, transition plan

Restructuring and implementation steps under company law:

• Mergers/spin-offs
• Contribution of shares in return for the granting of company rights
• Spin-offs from operations
• Transfer of management functions
• (singular succession; Asset Deal, transfer of operations § 613a BGB; German Civil Code)

2.) Regulation of the energy market

• No continuous universal succession for mergers, e.g.:
• Permit electricity, natural gas licences
• Subsidies/governmental grants
• Feed-in remunerations

3.) Dependencies on other initiatives, e.g. Re-Financing of the Group

4.) Internal company resistance to the project, including resources, fear of losing, timeline