(Bloomberg) -- AMS AG is planning to discuss a potential renewed bid for German lighting group Osram AG following the failure of a 4 billion-euro ($4.4 billion) offer earlier this month, according to people familiar with the matter.
The Austrian sensor maker's supervisory board is scheduled to meet Friday to explore options, the people said, declining to be identified because the information is private. Should AMS decide on a fresh approach, it would have to at least match the former offer price of 41 euros per share, the people said.
One option being discussed is to lower the minimum acceptance threshold for the deal to boost the chance of success, the people said. AMS may also increase the capital it needs to finance the deal, thereby lowering the debt, according to one of the people.
AMS shares dropped 4.5% to 42.78 francs in Zurich as of 9:39 a.m., while Osram rose 0.9% to 39.31 euros in Frankfurt.
AMS needs approval from its financing banks as a pre-requisite for the firm's supervisory board to agree to a renewed approach, they said. Private equity firms Bain Capital and Advent International, which have also pursued Osram, are reviewing their options now that AMS has built a 19.99% stake in the German company, effectively blocking any counter bid, the people said.
AMS and Osram declined to comment.
Osram Takeover Battle Set for Next Round After AMS Bid Setback
Osram representatives have urged AMS to address lingering concerns around strategy, job cuts and the massive debt burden for the deal, one of the people said. AMS planned to invest in the company's Regensburg, Germany site that makes high-tech chip components, but said it would sell the digital division that makes lighting controls, stage and theater lights.
AMS earlier failed to attract enough support from shareholders with its earlier 41 euro per share bid after Osram investors tendered 51.6% of their shares, short of a 62.5% acceptance threshold.
The Austrian company has also hit up against resistance from Osram's workforce. The IG Metall union's representative of Osram's board has sought to pressure AMS largest investor, Temasek to reject the attempted "hostile" takeover. Singapore's sovereign wealth fund, which owns about 5.4% of AMS, won't intervene in AMS's plans, according to a report Frankfurter Allgemeine, citing a statement.
The supplier of facial recognition technology for Apple Inc.'s iPhone subsequently said it will seek a regulator nod to raise its current stake in Osram.
To contact the reporters on this story: Oliver Sachgau in Munich at osachgau@bloomberg.net;Eyk Henning in Frankfurt at ehenning1@bloomberg.net
To contact the editors responsible for this story: Kenneth Wong at kwong11@bloomberg.net, ;Aaron Kirchfeld at akirchfeld@bloomberg.net, John Bowker
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