3 Min Read
FRANKFURT, May 18 (Reuters) - German auto supplier Grammer's biggest shareholder accused the company on Thursday of artificially depressing its own share price to allow a rival investor, China's Ningbo Jifeng, to build a stake.
The accusation made by Cascade Investment International GmbH, a company controlled by Bosnia's Hastor family, is the latest twist in a battle for influence over the auto supplier, which has intensified ahead of the company's annual general meeting next week.
The Hastor family, which has a stake of at least 20 percent in Grammer, was reacting to a story in Germany's WirtschaftsWoche magazine on Thursday, which quoted Grammer's Chairman Klaus Probst as saying that the auto supplier's order intake had halved, dropping by about 300 million euros ($334 million). His comments sent Grammer's shares down nearly 10 percent early on Thursday.
"This obviously tactical manoeuvre by management causes enormous damage to the company," Cascade said in a statement.
"Whoever circulated these rumours, is pursuing one interest: to depress the share price in the short term, so Chinese investors, who have been called upon to act as 'White Knight', are able to cheaply increase their stake in the short term," it said.
A Grammer spokesman said: "We emphatically reject the accusation of market manipulation."
Grammer's shares narrowed losses later in the day to close down 2.75 percent at 50.52 euros. Grammer has sought to dilute the influence of the Bosnian investor group, which has criticised Grammer's management and campaigned for seats on the board of directors.
The German company warned late last month that customers would be reviewing their business relations if the Hastor family increased its control over Grammer.
The Hastor family has sought to install three members of the supervisory board at Grammer's annual general meeting on May 24.
Grammer's management has backed plans to deepen ties with a rival car supplier, China's Ningbo Jifeng, which holds a 12.1 percent stake in Grammer.
Ningbo Jifeng has said it plans to increase its Grammer stake beyond 12.1 percent. ($1 = 0.8986 euros) (Reporting by Maria Sheahan and Edward Taylor; Editing by Susan Fenton)