Ströer SE & Co. KGaA SAX
Muddy Waters publishes the translated transcript of Ströer's June 2016 AGM, where CEO Udo Müller defends the company against MW's short attack amid sharp shareholder questions.
Thesis
This is Muddy Waters' English translation of the Ströer SE & Co. KGaA annual general meeting held in Cologne on June 22, 2016, roughly two months after MW publicly shorted the German out-of-home advertising group. CEO Udo Müller devotes much of his address to rebutting MW's April 21, 2016 report — characterising MW as an 'activist short seller' who borrowed seven to eight million shares, flooded the market, then went on Bloomberg TV to call management 'criminals.' He cites Ernst & Young and Freshfields reviews clearing the company and touts 2015 revenue of €824m (+14%), EBITDA of €208m (+40%) and a 75% dividend hike. Activist retail shareholders including Klein and Kiel press repeatedly on the freeXmedia related-party transaction, the €2.5m advisory fees, Sambara Foundation share transfers, and why management refuses to actually sue MW.
SCQA
Ströer is Germany's leading out-of-home advertising group, pivoting aggressively into digital media via T-Online and Interactive Media acquisitions; it reported record 2015 results and was trading near €50 before the MW attack.
On April 21, 2016 Muddy Waters publicly shorted Ströer, alleging related-party self-dealing, creative accounting and governance failures — triggering a share-price crash from €52 to roughly €35 within 45 minutes.
Management rejects every allegation, points to EY and Freshfields reviews that cleared the company, declines to sue MW or launch a buyback, and asks shareholders to approve the results, dividend and board slate.
The share price recovered above €50 within days; all eleven sell-side analysts maintain Buy ratings with an average target of €72.40, roughly 40% above the meeting-day price.
The three reasons
- 1
Ernst & Young and Freshfields reviews found none of MW's allegations substantiated
- 2
MW manipulated the price by flooding the market with 7-8m borrowed shares
- 3
2015 was a record year: revenue +14% to €824m, EBITDA +40%, dividend +75%
KPIs cited
Pattern membership
Precedents cited
- Sino-Forest (Chinese company with fabricated forests) — cited by management as the archetypal MW short
Slide gallery ·
Notes
Unusual format: not a short report but Muddy Waters' English translation of Ströer's ordinary general meeting transcript (~90 pages, two-column verbatim record). MW added its own branded cover, amended ToS and a disclaimer disclosing a continued short position. The bulk of content is CEO Udo Müller's rebuttal of MW's April 21, 2016 short report, followed by lengthy hostile Q&A from retail activists — notably Klein and Kiel — whose questions closely track MW's allegations (freeXmedia/Interactive related-party deal, Sambara Foundation share transfers, €2.5m advisory fees, corporate-governance independence, Turkey operations). Classified document_type='other' and is_primary_material=false because the document's content is management's defence even though MW is the publisher — MW's value-add is the framing/translation rather than a new thesis. No charts, images or slides — pure text transcript, low visual interest but a rich specimen of how a shorted issuer defends itself live at an AGM.