Weapons company - Shareholder dispute at Heckler & Koch continues
After the cancelled annual general meeting of weapons manufacturer Heckler & Koch, the power struggle among shareholders continues. Major shareholder Andreas Heeschen appeared before the Stuttgart Higher Regional Court on a Wednesday (Case No. 31 O 131/22 KfH), aiming to overturn Heckler & Koch's annual general meeting resolutions from 2022. In the first instance, he had withdrawn his claim at the Stuttgart District Court, now comes the next instance.
Heckler & Koch is the largest German manufacturer of assault rifles, machine guns, pistols, and grenade launchers, with around 1100 employees, of whom approximately 1000 are based at the headquarters in Oberndorf (Black Forest).
Investor Heeschen had transferred a significant shareholding to the Luxembourg financial holding CDE in the past decade as part of a pledge agreement. According to CDE, Heeschen later lost his ownership rights to the shares and thus the majority of the company. Heeschen disagrees – from his perspective, he still holds the majority. Since the CDE exercised the majority of the voting rights at the 2022 annual general meeting, Heeschen considers the resolutions invalid.
The legal dispute in Stuttgart, which also involves other shareholder meetings, is a side issue in the bitter confrontation between the two major shareholders at Heckler & Koch. The parties have already met before Frankfurt courts. There, the question was whether the CDE is the lawful owner of the shares or not – the Federal Court of Justice will soon have to decide on this matter.
On a Tuesday, the annual general meeting of H&K took place in Rottweil. The chairman of the meeting did not grant the voting rights from a large shareholding to either the CDE or Heeschen. Since Heeschen did not register for the meeting as expected with another, smaller shareholding, the attendance requirement of at least 50% of the share capital was not met – the ongoing annual general meeting in Rottweil had to be abandoned.
This was a notable incident that highlighted the deep rifts between Heeschen and the CDE. The annual general meeting must be held again within three months.
- Despite the power struggle among shareholders, Heckler & Koch, located in the Black Forest's Oberndorf, continues to be the leading defense industry company in Germany, employing around 1100 individuals, with a significant portion working at the headquarters.
- At the cancelled annual general meeting of Heckler & Koch in Rottweil, Major shareholder Andreas Heeschen was expected to attend with another, smaller shareholding, but he did not, resulting in the meeting's abandonment due to not meeting the attendance requirement.
- Andreas Heeschen, the controversial investor, currently has a dispute ongoing at the Stuttgart Regional Court (Case No. 31 O 131/22 KfH), aiming to challenge Heckler & Koch's annual general meeting resolutions from 2022, which he considers invalid due to his continued majority ownership.
- After withdrawing his claim at the Stuttgart District Court in the initial instance, Heeschen is now proceeding to the next level of proceedings at the Stuttgart Higher Regional Court, seeking to overturn the annual general meeting resolutions.
- Heckler & Koch's annual general meeting resolutions from 2022 were introduced at a meeting held in Rottweil, whereas Major shareholder Heeschen lost his right to the majority of the company following a significant shareholding transfer to Luxembourg financial holding CDE.
- The defense industry company's shares were heavily impacted by the ongoing legal dispute between Andreas Heeschen and the CDE, which is not only affecting the Stuttgart Regional Court but also involves shareholder meetings and decisions made at Frankfurt courts.
