Daimler AG / Key word(s): Strategic Company Decision
Daimler Board of Management decides on first steps to strengthen divisional structure
Stuttgart, Germany - Daimler AG aims to further focus and strengthen the Group's corporate structure through the creation of legally independent entities. In addition to the existing legally independent division Financial Services, the divisions Mercedes-Benz Cars & Vans as well as Daimler Trucks & Buses may be transferred into two legally independent entities to take greater entrepreneurial responsibility.
This project intends to strengthen the future viability of the business units and better utilize the potential for growth and earnings in the various markets. Daimler AG does not plan to divest any of its divisions.
Based on the positive results of a feasibility study, the Board of Management today decided, subject to the approval of the Supervisory Board, to continue with the project and in this context to take preparatory measures. Daimler will invest a three-digit million euro amount for these first steps.
Close consultation is taking place with the employee representatives; an agreement has been reached on the cornerstones of a balance of interests to secure Daimler's employees' future. Major elements are the extension of the agreement on safeguarding employment until the end of 2029 (»Zukunftssicherung 2030«), increasing the funded status of pension obligations and an extension of the common profit-sharing bonus of Daimler AG. In connection with the balance of interests, Daimler plans a contribution of EUR3.0 billion from liquid funds to the German pension fund of Daimler AG in the fourth quarter 2017, subject to the approval of the Supervisory Board. For full-year 2017, Daimler expects the free cash flow of industrial business, excluding the mentioned pension contribution, to be slightly above prior-year's level.
Until now, neither the Board of Management nor the Supervisory Board of Daimler AG has made a final decision on implementing the new structure for the Daimler Group. Both boards will come to a final resolution after the ongoing assessments and negotiations have been completed. Should the Board of Management and Supervisory Board decide to finally implement the new Group structure, those measures would require the approval of a shareholders' meeting of Daimler AG. Such a motion could be voted on at the earliest at a shareholders' meeting in the year 2019.
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