Neuendorf ‘Poison Pill’ Passes, Complicating Takeover

The takeover attempt at Artnet AG grew more complicated today as shareholders at the company’s annual meeting in Germany passed a measure that allows no major changes at the company without approval of its current owners. Longtime Artnet CEO Hans Neuendorf, whose son Jacob Pabst now holds that title, currently has control of the company, owning about 26 percent of it, and the measure passed today gives the Neuendorf family veto power over many business decisions at Artnet, calling for a 75 percent majority where previously a 50 percent majority would have sufficed.

The news broke in a report by Skate’s, the art investment newsletter founded by Sergey Skaterskhov, who sits on the board of Redline Capital Management SA, the firm leading the takeover effort at Artnet with Weng Fine Art (together the two companies own about 10 percent of Artnet). “Neuendorf Wins, artnet Loses, Redline and Weng Move to Focus on Their Core Businesses” read the headline on of the Skate’s newsletter, which features colorful descriptions of the meeting (e.g. “Mr. Neuendorf and his supporters walked from the shareholders meeting at Fasanenstrasse looking like proud and happy pheasants who had just avoided being shot, while the pheasant hunters looked as though they did not mind just going out for the hunt.”)

Up next, said the newsletter, Redline and Weng will announce their tender offer for the company, which may now include a provision that they will not buy any stock unless they can buy enough to own 75 percent of the company, meaning the takeover might have been averted completely.