Petrus Advisers vs. Aareal Bank: Turbo capitalism with a human face?

Dear readers of GermanBoardNews,

it is strikingly reminiscent of the escalation of the conflict between ThyssenKrupp and Cevian Capital: on the one hand, a company rich in tradition that is facing major challenges. And on the other side an activist investor who keeps increasing the pressure on the executive and supervisory boards.

In the case of ThyssenKrupp, the escalation in summer 2018 led to CEO Heinrich Hiesinger and Supervisory Board Chairman Ulrich Lehner resigning in quick succession. At the time, we ran the headline “The end of Rhineland capitalism” because both stand for long-term corporate governance for the benefit of all stakeholders.

The conflict between London-based hedge fund Petrus Advisers and Wiesbaden-based property financier Aareal Bank could now take a similar course. CEO Hermann Josef Merkens has just resigned (albeit for health reasons – get well soon). At the same time, Petrus Advisers is pushing with growing vehemence for the departure of supervisory board chairwoman Marija Korsch.

Laber vs. Korsch: Showdown in May

Therefore, a showdown will take place at the annual general meeting in four weeks: Petrus is sending former HVB board member Theodor Heinz Laber into the race to replace Korsch. In addition, the activists, who hold just under ten percent of the shares, have nominated two further candidates for the twelve-member supervisory body.

Now I must add that I experienced Petrus partner Till Hufnagel at the German Supervisory Board Day (DART) in November 2019 as a bright mind and pleasant conversational partner. My impression at the time: he is less aggressive than other activists and pays more attention to the congruence of interests with other shareholders.

After all, the very name “Petrus Advisers” suggests: we are dealing with sky watchers here – and not with hell hounds. Moreover, the Londoners (also) see themselves as advisors, not pure investors.

Are we witnessing a radicalisation of activists?

However, Jens Tischendorf, the head of Cevian Germany at the time, was always polite and constructive. But the longer the hoped-for share price gains and lavish dividends failed to materialize, the harsher the tone towards ThyssenKrupp’s top management became – and the more offensively Tischendorf took the conflict public.

In doing so, he made it clear once and for all that the interests of Cevian investors were far more at stake than those of ThyssenKrupp and other stakeholders. The result is well known.

I have the impression that we are currently experiencing a similar development at Petrus – especially as analysts are of the opinion that Aareal Bank is “basically doing well” or is “on a good path”. Against this backdrop, the guns that Till Hufnagel is bringing out seem completely disproportionate.


Yours, Peter H. Dehnen