Adnoc Denies Hedge Funds the Neat German M&A Trade: Chris Hughes

The first question at the beginning of any German takeover is what the ending looks like. Buying a Frankfurt-listed company is typically a tortuous process which can see hedge funds push for a higher price and workers and politicians cry foul. Abu Dhabi National Oil Co.’s €12 billion ($13 billion) offer for Covestro AG may yet succeed in sidestepping both hurdles — and pave the way for more inbound acquisitions.

First, the technical problem. Corporate and private equity bidders often seek to get 75% ownership of German targets, the voting level where they’re able to implement a so-called domination agreement enabling them ...