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INDEX. History Structure of OIAG Organisation of OIAG Privatization. Supervisory Board of ÖIAG:. 10 Shareholder 5 Employee 4 Experts for privatisation representatives representatives Appointed by:

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Presentation Transcript
slide1

INDEX

  • History
  • Structure of OIAG
  • Organisation of OIAG
  • Privatization
slide2

Supervisory Board of ÖIAG:

  • 10 Shareholder 5 Employee 4 Experts for privatisation
  • representativesrepresentatives
          • Appointed by:
  • Ministry of Finance Federal chamber 2 by Federal chamber of labor (Bundes- of labor
  • arbeiterkammer) 2 by Federal chamber of commerce
  • 1 direct representative of
  • the Ministry of economy affairs
  • 1 direct representative of
  • the Ministry of Finance
  • Supervisory board members with voting right Advisor; no voting right
the austrian joint stock corporation aktiengesellschaft
The Austrian joint stock corporation (Aktiengesellschaft):
  • Supervisory board Minimum 3 members Appoints, removes and
  • (Aufsichtsrat) (Chairman, Vice chairman) supervises the Management
          • board, but is normally not
          • entitled to give directions
  • Management board 1 or several members Responsible for day-to-
  • (Vorstand) day management and
          • corporate policy
  • Shareholders general elects Supervisory board
  • meeting members
  • (Hauptversammlung)
  • At ÖIAG the general shareholders meeting consists of the Republic of Austria
  • represented by the Ministry of Finance.
shareholders general meeting
Shareholders general meeting:
  • adopts Memorandum and Articles
  • elects and removes Supervisory board members (except for employee
    • representatives)
  • decides increase or reduction of capital and eventual disapplication of
    • shareholders pre-emption rights in the issue of new shares
  • discharges Supervisory board
  • appoints auditors
  • decides profit distribution
  • decides dissolution of the company, merger into another corporation and
    • fundamental change of business
supervisory board
Supervisory Board:
  • size according to capital of the corporation
  • supervises the Management board
  • has the right to request reports by the Management board and to inspect the
    • accounts and assets of the corporation
  • appoints and removes the Management board
  • diligent discharge of responsibilities towards shareholders
  • 1/3 of the members employee representatives
slide6

Supervisory Board:

  • Management board has to seek the Supervisory board´s consent for major
    • transactions, such as
    • - acquisitions and sale of companies or interests therein, acquisition and
    • sale or closure of companies or plants;
    • - acquisition, sale and mortgaging of real estate;
    • - establishment and closure of subsidiaries;
    • - investments above certain limits;
    • - taking or granting of loans above a certain amount to be specified
    • by the Articles of Association;
    • - opening or closure of business or production units;
    • - setting of general principles of business policy;
    • - setting of principles for profit or turn-over related renumeration and pension
    • grants to leading employees;
    • - grant of a power of procuration
  • Additionally, the Articles may provide that the Supervisory board´s consent is also
  • necessary for other matters.
decision flow
DECISION FLOW

Reports

Parliament

Appoints the Supervisory Board

Minister

Stock company

ÖIAG

Stock company

Presides inSupervisoryBoard

OMV, VA Stahl etc

Limited liability comp.

Company(Subsidiary)

organisation and administration for the nationalized industry
Organisation and administration for the nationalized industry
        • OrganisationPolitical responsibility
  • 1946-59 Ministry for transport and public economy
  • 1959-66 Chancellery
  • 1966-67 Ministry for transport and public economy
  • 1967-70 Limited comp. "Österr. Ministry for transport
      • Industrieverwaltungs and public economy GmbH (ÖIG)" as trustee for the Republic of Austria
organisation and administration for the state owned industry
OrganisationPolitical responsibility

1970-86 OIAG (Austrian Industries Federal chancellery Holding Comp.): joint stock company; speciality: super- visory board reflects socio- political landscape of Austria

1986-93 politically indipendent Ministry for transport and supervisory board members public economy

1993 New OIAG-law changes task Ministry for transport and of OIAG: OIAG shall no longer public economy form an industrial conern, but shall privatise the majority of its companies. OIAG shall remain minority shareholder of the most important industrial companies of Austria.

Organisation and administration for the state-owned industry
history of the state owned industry
1946: First Nationalisation Law: approved by all parties in parliament (conservative people party, socialist party, communist party)

1950-1970: Period of economic boom:

high level of demand

high production level

high capital expenditure

full employment

increasing wages

high social benefits (f.i.: company pension schemes etc.)

History of the state-owned industry
history of the state owned industry1
1970-1985: economic decline

increasing competition

worldwide recession (oil price shock 1973, 1975)

political influence on nationalised companies to maintain employment level by diversifiing into new production areas

merger of carbon & special steel firms (VOEST & ALPINE)

economic problems of Voest-Alpine because of losses in the new production areas

History of the state-owned industry
history of state owned industry
1985-1987:

government changes management of Voest and ÖIAG, big enterprises are split into legally iandependent market oriented companies

parliament approves a large capital injection, imposing that it will be for the last time and that further new capital could only be raised by privatisations

Restructuring of Voest-Alpine:

- decentralisation: devisions are split into legally indipendent business units

History of state-owned industry
history of the state owned industry2
1987-1989: Reorganisation and Consolidation period

1990-1992:

general economic upswing

Austrian Industries group issues convertible bonds, intending to convert them into shares within 5 years

Internationalisation of the group by an aggressive acquisition policy

History of the state-owned industry
slide14
1993:

recession: lowest steel-price of the cycle, lowest aluminium prices since the 1950ies

aluminium group of Austrian Industries is nearly bankrupt due to the worldwide aluminium crisis and too expensive acquisitions; OIAG as the mother Company of Austrian Industries can no longer carry its debt burden and has to be helped by the state.

government passes a new law: OIAG gets a subordinated loan, repayable after repayment of bank loans. All liabilities have to be paid back by privatisation revenues.- ÖIAG shall privatise all its companies in due time. The companies and the extent to which they shall be privatised are determined in the law.- Austrian Industries has to be merged with ÖIAG. ÖIAG shall no longer form a conern.

History of the state-owned industry

debt reduction
Debt Reduction

bn ATS bn Euro

Ⅰ) OIAG Net Debt as of 31.12.93

% Privatisation proceeds

ÖIAG Net Debt as of 31.12.99

22,2

1,61

-22,8

- 1,66

0

0

Ⅱ) Additional ÖIAG Privatisation Proceeds

8,1

0,59

Ⅲ) PTBG Debt as of 31.12.1996

Privatisation Proceeds minus interest

PTBG Debt as of 31.12.1999

50,0

3,63

21,0

1,53

29,0

2,11

Ⅳ) Old ÖIAG Debt to be payed back by further

privatisation proceeds

46,2

3,36