Five more face trial in Mannesmann court action

23 Sep 2003

Five former officials of the German telecoms conglomerate Mannesmann are to stand trial over their role in the company’s takeover by Vodafone in 2000. The five – former CEO Klaus Esser, chairman Joachim Funk, head of personnel Dietmar Droste and two board members, Jurgen Ladberg and Klaus Zwickel – will join Deutsche Bank’s chief executive Josef Ackerman, already called for trial, in fighting their innocence. All of the defendants, bar Esser and Droste, are being charged with breach of trust, following an investigation which found that the Mannesmann supervisory board on which they sat approved ‘appreciation awards’ totalling EUR70 million to Esser and other managers during the Vodafone takeover. The payments were made shortly after Esser, previously opposed to the Vodafone bid, backed down and approved the takeover. Breach of trust carries a penalty of up to five years imprisonment. Esser and Droste are being charged with abetting a breach of trust. Any ruling against Ackerman, the architect of the turnaround in Deutsche Bank’s fortunes, would throw the country’s biggest bank into turmoil, as there are no obvious successors capable of taking the reins in the short term. Mr Ackerman has vowed to fight the charges and insists he will not ‘do a deal’ with prosecutors, though worried bank insiders say an out of court settlement cannot be ruled out.

Germany