Who Owns 1&1 Company?

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Who Owns 1&1 AG?

Understanding a company's ownership is key to grasping its strategic direction and accountability. In a significant move, United Internet AG announced a voluntary public acquisition offer in May 2025 to boost its stake in 1&1 AG. This aims to further consolidate its majority voting rights and solidify its position in the German telecommunications sector.

Founded in 1988 by Ralph Dommermuth, 1&1 AG has grown from a software marketing service provider to a major telecommunications force. As of August 15, 2025, its market capitalization stands at $3.83 billion, with 176 million shares outstanding. The company offers a wide range of services, including broadband internet and mobile plans, and has undergone significant ownership shifts, including a recent acquisition offer from United Internet AG.

Delving into the ownership structure of 1&1 AG reveals a fascinating evolution. We will explore its journey from its inception, the role of early investors, and the current substantial influence of United Internet AG. Examining the board composition and voting power dynamics provides a clear picture of who controls this key player in the German market. For a deeper understanding of the external factors influencing the company, consider a 1&1 PESTEL Analysis.

The origins of 1&1 trace back to 1988 when Ralph Dommermuth established 1&1 EDV Marketing GmbH in Montabaur. Dommermuth, with a background in banking, initially focused on marketing services for software companies before expanding to larger clients. The company that would later become 1&1 AG was formed through a reverse takeover of Drillisch AG.

Dommermuth's Entrepreneurial Vision

Ralph Dommermuth's entrepreneurial drive was the catalyst for 1&1's inception. His initial focus on marketing services laid the groundwork for future expansion.

Drillisch AG's Foundation

Drillisch AG was founded by Hans Jochen Drillisch, Marc Brucherseifer, and Nico Forster in 1997. This entity would later be instrumental in the formation of 1&1 AG.

Early Public Offering of Drillisch AG

Drillisch AG conducted its initial public offering in 1998. This event involved the issuance of shares from both capital increases and existing shareholders.

IPO Share Distribution

During its IPO, Drillisch AG issued up to 600,000 ordinary shares. A significant portion, 360,000 shares, came from a capital stock increase, while 240,000 shares were from existing shareholders.

Founders' Role in Early Ownership

The founders of Drillisch AG played a pivotal role in its early ownership structure. The IPO agreements were key in defining the initial public distribution of shares.

Expansion of Services

Dommermuth's initial marketing focus evolved to encompass a broader range of services. This strategic expansion was crucial for the company's growth trajectory.

The strategic decision to merge 1&1 EDV Marketing GmbH with Drillisch AG through a reverse takeover was a pivotal moment, effectively creating the entity that would become 1&1 AG. This move allowed 1&1 to leverage the public market presence established by Drillisch AG. Understanding the Target Market of 1&1 is essential to appreciating the company's evolution from its early days.

Key Milestones in Early Ownership

The early years were characterized by foundational business development and strategic corporate actions that shaped the ownership landscape.

• Establishment of 1&1 EDV Marketing GmbH in 1988 by Ralph Dommermuth.
• Founding of Drillisch AG in 1997 by Hans Jochen Drillisch, Marc Brucherseifer, and Nico Forster.
• Drillisch AG's IPO in 1998, establishing its public market presence.
• The reverse takeover that led to the formation of 1&1 AG, integrating Dommermuth's business.

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The ownership of 1&1 AG has seen a significant consolidation, primarily driven by the increasing stake held by United Internet AG. This evolution has reshaped the company's strategic direction and operational integration within the broader internet services sector.

The journey of 1&1 AG's ownership is largely defined by the growing influence and control of United Internet AG. Initially going public as Drillisch AG on April 22, 1998, the company experienced a pivotal shift in 2015 when United Internet AG acquired a 20.7% stake, subsequently becoming the majority shareholder by May 27, 2015. This consolidation intensified in 2017 through a reverse takeover, integrating 1&1 Telecommunication SE into Drillisch, which resulted in United Internet AG holding at least 73.7% of the conglomerate. By December 2021, United Internet AG's stake in 1&1 AG reached approximately 78.32%, a figure that continued to climb, surpassing the 80% threshold in April 2025. As of May 16, 2025, United Internet AG held about 80.81% of 1&1 AG's capital stock. A voluntary public partial acquisition offer was launched on the same date to acquire an additional 9.19% of shares, aiming to boost United Internet's ownership to up to 90%. Despite these moves, United Internet has indicated its intention to maintain a free float of at least 10%, avoiding a domination agreement or delisting. As of July 15, 2025, United Internet AG held 78.32% of 1&1 AG's equities, representing 138,437,357 shares. The remaining shares constitute the free float, with the company holding 465,000 treasury shares. Major institutional shareholders within the broader United Internet Group include The Vanguard Group, Inc., BlackRock, Inc., and State Street Global Advisors, Inc. These ownership changes have significantly aligned 1&1 AG's strategy with United Internet's broader telecommunications and internet services portfolio, including its 5G network development. Understanding the Competitors Landscape of 1&1 provides further context to these strategic alignments.

Key Stakeholders and Free Float

United Internet AG is the dominant owner of 1&1 AG, holding a substantial majority stake. The remaining shares form the free float, available for public trading.

• United Internet AG: Majority owner with approximately 80.81% as of May 16, 2025.
• Free Float: Represents the shares available for public trading, intended to remain at least 10%.
• Major Institutional Shareholders (within United Internet Group): The Vanguard Group, Inc., BlackRock, Inc., State Street Global Advisors, Inc.
• Treasury Shares: 465,000 shares held by the company itself.

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The current Board of Directors and the voting structure of 1&1 AG highlight the significant influence of United Internet AG. Ralph Dommermuth, the founder of United Internet AG, also serves as the CEO and Chairman of the Management Board of 1&1 AG, underscoring a close alignment between the two entities.

The voting power within 1&1 AG is fundamentally tied to its share structure, with a one-share-one-vote principle in effect. As of the Annual General Meeting on May 14, 2025, there were 176,764,649 no-par ordinary shares, each carrying one vote. United Internet AG holds a substantial majority stake, approximately 80.81%, with the potential to increase this to 90% through a recent partial acquisition offer. This concentration of ownership grants United Internet AG considerable control over strategic decisions, while the company maintains a free float of at least 10% to ensure continued stock exchange trading. There have been no public reports of significant challenges to this ownership structure or the decision-making authority of the majority shareholder, indicating a stable governance framework.

Understanding 1&1's Corporate Governance

The corporate structure of 1&1 AG is heavily influenced by its majority owner, United Internet AG. This relationship shapes the company's strategic direction and operational oversight.

• United Internet AG is the primary 1&1 owner.
• Ralph Dommermuth leads both United Internet AG and 1&1 AG.
• The voting power is concentrated due to majority ownership.
• A minimum free float is maintained for trading accessibility.
• The company's structure reflects a stable, albeit concentrated, governance model.

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Over the past few years, the ownership of 1&1 AG has seen a significant consolidation trend, with its parent company, United Internet AG, steadily increasing its stake. This strategic move aims to further integrate operations and leverage infrastructure investments.

Despite the increasing control by United Internet AG, 1&1 AG has maintained a commitment to a public free float, ensuring its continued listing on the stock exchange. This approach is supported by the company's stance against delisting or squeeze-out measures, emphasizing a balanced ownership structure.

Maintaining Free Float

1&1 AG intends to keep at least 10% of its shares in public hands. This ensures ongoing stock exchange trading and accessibility for investors.

Index Inclusion Argument

The company contested its removal from key indices, citing a substantial free float of nearly 15%. This highlights their commitment to maintaining market presence.

Management Transition

Sascha D'Avis took over as CFO on January 1, 2025, succeeding Markus Huhn. This internal succession reflects continuity within the broader group structure.

Industry Consolidation Trends

The telecommunications sector in 2024-2025 is characterized by asset separation and increased institutional investment in infrastructure. This trend supports strategic focus and efficiency gains.

1&1 AG's significant investment in building Europe's first fully virtualized 5G mobile network, utilizing Open RAN technology, aligns with these industry shifts. This ambitious project, with substantial payments of approximately €170 million expected for network build-out by year-end 2025, underscores the strategic importance of its infrastructure development and the stability provided by its ownership structure. Understanding the Revenue Streams & Business Model of 1&1 is crucial to appreciating the value of these infrastructure investments.

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