Yep, its the magnetic adjuster for the cam timing. Had almost the exact same oil leak on the M119 in my S500.
Remove the three allen headed screws you see and it comes right off. There is no gasket.
Clean up the mating surfaces, put a small film of RTV on it and refasten it. No more leaks. Takes about 5 minutes.

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KenP

1996 S500 W140 Coupe