The recent proposed settlement offer from Deutsche Bank in a long-standing case has been met with harsh criticism from the plaintiffs’ lawyer, describing it as a “late low ball” offer. The core of the dispute revolves around the accusation that Deutsche Bank undervalued its acquisition of Postbank, a major German retail banking giant, during the late 2000s. Legal proceedings related to this multi-phase deal have been ongoing since 2010, involving hundreds of claimants from both institutional and private investors.
The settlement offer of 36.50 euros per Postbank share presented by Deutsche Bank has raised concerns among the claimants, who have until the upcoming Monday to respond. However, it seems that the offer faces resistance, with one claimant already rejecting it. The plaintiffs’ lawyer has expressed skepticism about the feasibility of the settlement deal going through, especially given the approaching court hearing scheduled to take place at the Higher Regional Court in Cologne.
The abruptness and timing of the settlement offer, particularly during the holiday season, have added another layer of complexity to the situation. The plaintiffs’ law firm, representing primarily institutional claimants seeking around 1 billion euros in claims, has raised doubts about the practicality of reaching out to all claimants within the tight deadline. The spokesperson for Deutsche Bank has refrained from divulging more details about the ongoing negotiations.
The unresolved Postbank litigation has taken its toll on Deutsche Bank’s financial performance, as evident from the net loss reported in the second-quarter results due to a significant provision made for Postbank-related cases. Despite the initial negative impact on Deutsche Bank shares following the announcement, the year-to-date data shows a positive trend in share performance. The legal dispute surrounding the obligation to make a higher takeover offer remains contentious, with conflicting claims from both sides.
The legal battle took a twist when the Higher Regional Court of Cologne dismissed all claims in the proceedings in 2020, only to be overturned by Germany’s Federal Court of Justice in 2022. The case was sent back to the Higher Regional Court for further examination and a fresh decision, prolonging the dispute and adding to the uncertainties surrounding the outcome.
The unfolding legal saga between the plaintiffs and Deutsche Bank regarding the disputed settlement offer for the acquisition of Postbank continues to present challenges and complexities for both parties. The conflicting claims, court rulings, and financial ramifications underscore the intricacies involved in such high-stakes legal battles within the corporate landscape. The forthcoming court hearing and the responses from the claimants will determine the next course of action, potentially shaping the resolution of this long-standing dispute.
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