The current UniCredit/Commerzbank and Schaeffler/Vitesco cases revive the longstanding, but still very much unsettled, legal questions of whether, and if so how, synergies and stock prices should be treated in company valuations. Does the proposition that Ballwieser put so pointedly in 1997 still hold true: “There seems to me to be no real dispute that synergy effects must be taken into account in mergers and acquisitions. After all, you pay for what you can extract. It is as simple as that.”

Of course, it is not quite that simple, as we explained in Part I of our article, using UniCredit/Commerzbank as an example, on the REUTER Corporate+Compliance Blog of May 25, 2026. Over the past 25 years, legal debate has developed a strong tendency to value each of the companies involved on a stand-alone basis, thus generally excluding synergies, and to accord greater weight to stock prices. In Part I, however, we also showed that this approach can be misleading where a corporate integration measure generates substantial synergies that the stock market leaves unreflected because the market is unable to assess them. Synergies are a “hidden potential” inherent in a company, much like hidden reserves.

In Part II of our article, we further substantiate our doubts as to whether stand-alone stock prices should be treated as conclusive, using Schaeffler/Vitesco as our example. The fact that potential is “hidden” does not mean that it can be disregarded.

The UniCredit/Commerzbank and Schaeffler/Vitesco cases revive the long-standing, yet still highly virulent legal questions how synergies and stock market prices are to be treated in company valuations. In the legal and academic discussion of recent years, there has been a clear tendency across different valuation contexts to assess the companies involved on a “stand-alone” basis, i.e. generally without taking synergies into account, and to attribute greater binding force to stock market prices. The extent to which this tendency is questionable is illustrated by the current UniCredit/Commerzbank and Continental/Vitesco cases. This analysis is supported by the 2026 revision of the Standard S1 of the Institut der Wirtschaftsprüfer (IDW) on business valuation. The revised version remedies old points of criticism raised by the author with respect to the treatment of synergies in previous S1 versions. The valuation issues also have an impact on the duties of the directors of the involved companies. The following blog addresses these issues using UniCredtit/Commerzbank as a mere sample. Schaeffler/Vitesco will be dealt with in a forthcoming blog.

In the Wirecard case, the German Federal Court of Justice (BGH) issued a decision on November 13, 2025 (IX ZR 127/24), resolving a highly controversial question: If a management board violates ad-hoc disclosure obligations or other capital-market disclosure duties, and shareholders therefore bring capital-markets-based damages claims, but the company subsequently enters insolvency proceedings, what priority do such damages claims have in the insolvency? Are they treated as ordinary insolvency claims of other creditors, or do they rank behind them as membership-related rights? According to the BGH, the latter applies, because the claims are rooted in the shareholders’ status as owners of the company’s shares. This subordinated ranking can significantly improve the recovery rate of ordinary creditors.

The BGH derives the subordination from a comparison of claims from the perspective of insolvency law and its task of allocating the debtor’s financial shortfall appropriately: Who is “closer” to bearing the deficit? This convincing starting point highlights, however, two blind spots in capital-markets law: Capital-markets damages claims ignore (i) that it is the fellow shareholders who ultimately bear the economic loss of the stock purchasers, and (ii) that those who sold shares at an inflated price during the misinformation period may keep that benefit. The sellers thus pocket the gain that the remaining shareholders must compensate. This violates the constitutional guarantees of equal treatment and protection of share ownership.

Breaches of law arising from delayed filing for insolvency account, by case numbers, for the bulk of executive liability claims. At the same time, the number of insolvencies is rising again. The number of court decisions dealing with D&O liability issues or with questions of coverage by D&O insurers is also increasing. For that reason, we periodically make legal forays on our blog into practical aspects of delayed insolvency filings. The following blog contribution addresses the Federal Court of Justice (BGH) judgment of 2014, which made it easier for D&O insurers in coverage litigation to invoke the defence of knowledge where the insured managing director has breached an elemental professional duty (a cardinal duty). The Frankfurt Higher Regional Court (OLG Frankfurt) deepened and extended this case law in three decisions from 2025 concerning breaches of the duty to file for insolvency and the prohibition on payments once insolvency has arisen. The “cardinal-duty case law” inevitably increases the difficulty of the questions insolvency practitioners must confront when pursuing liability claims against managing directors with a view to attain D&O coverage. These difficulties also point to a deeper structural flaw in D&O insurance and its typical knowledge exclusion. This Survey 6 presents the OLG Frankfurt decisions against that background. It opposes a methodologically unfortunate lateral shift in the questions that are at the core of the matter. Once again the finding of US Supreme Court Justice Oliver Wendell Holmes of 1904 holds true: Hard cases make bad law.

Are compliance management systems (CMS) merely legal exercises with no real effect? Empirical evidence suggests that the effectiveness of CMS cannot be demonstrated. Suggestions on how to assess the effectiveness of CMS quantitatively or qualitatively do not, as things stand today, provide a reliable measurement, but only partial insights that tend to obscure the bigger picture. In the absence of reliable measurability, common standards (DIN, IDW PS 980, COSO, etc.), companies, and auditors are resorting to increasingly comprehensive and expensive mandatory programs - a “race to best practice” in order to avoid liability. This costs money that is lacking elsewhere, as well as time, systematically promotes risk aversion in companies beyond the realm of compliance, and is likely to dampen the quest for opportunities. All of this is often lamented, but accepted. However, the mentioned empirical findings have palpable legal consequences: Obligations that entail costs and other burdens must be evidence-based. Standards that are not empirically anchored are therefore not binding, especially since “CMS overinvestment” can itself be negligent. Instead of working through standards, company management can and must rely on their own intuition and trust, the latter all the more so the more “participatory” and “agile” the company is organized. This can—already at the level of legal application—further enhance corporate This can counteract further internal bureaucracy within companies, even at the level of legal application. The author has explained this in more detail in an article in the Journal of Commercial and Economic Law (ZHR 2025, 433 ff.) and in an interview in BOARD 2025, issue 3. The following blog post summarizes the considerations briefly. The BOARD can be found on the Blog.