Categories Archivespublic

12-Jan-16: Panta Event Note (Ten Cate; Wincor Nixdorf; BG Group; Bouygues) standard

 – Koninklijke Ten Cate (KTC NA): Ten Cate says based on preliminary reports, it expects to have generated FY15 sales of approx €1.16bn implying organic growth of about 5% vs €1.042bn in 2014 and EBITDA (excl exceptional items) of approx €97.5mn or about 15% EBITDA growth vs €85m in 2014. In October 2015, TenCate had indicated to expect full-year organic sales growth of approximately 4%, similar to 2014, and EBITDA (excluding exceptional items) of approximately € 95 million. Although obviously a touch better than originally stated, these numbers hardly justify further stubborn opposition to Gilde’s 30%+ premium current EUR 24.60 cash offer (valuing Ten Cate around 9x 2015 EBITDA). After allowing for marginally better fundamental performance and using Dutch AEX index as reference index ...

Continue Reading

11-Jan-16: Panta Event Note (BG Group; Home Retail; Xchanging; Syngenta) standard

– BG Group plc (BG/ LN): Despite crude prices further collapsing and 2.1% Shell shareholder Standard Life (unsurprisingly) publicly coming out against the deal, the other important proxy advisor Glass Lewis also recommended that Shell shareholders vote in favour of the deal: Glass Lewis, which is more US geared, has some relevance heres as around 30% of Shell’s shareholders are US based. With about 2 more weeks before the crucial vote happens, and still some lingering but very present risk that one of the 2 larger Shell shareholders could make a public negative statement on the deal, we would slightly reduce our BG position  below GBp 65 – but still would remain spread as a core position. – Home Retail Group ...

Continue Reading

08-Jan-15: Panta Event Note (BG Group, Home Retail, Melrose) standard

– BG Group plc (BG/ LN): After we highlighted the importance of a positive ISS recommendation yesterday, it was widely reported that ISS has now given its support for the (compelling strategic) transaction (ignoring the short term crude price weakness/volatility). Although ISS is understood to be advising only 5%, the backing by ISS could represent significant positive momentum in gaining 50% Shell approval in 3 weeks. Furthermore, Shell is stepping up its charm offensive convincing larger shareholders like BlackRock and Capital Group stating that the deal will not compromise its dividend in a lower oil price environment as the deal can work even if oil prices average $50 a barrel for two years and a as it plans to cut capital spending further below the ...

Continue Reading

BG Group: Shell shareholder vote dynamics standard

Although over last 5 years, Shell shareholders have almost always unanimously backed Shell’s Board, previous shareholder turnouts at Shell’s AGMs have been relatively low (54-63% turn outs).   A lower turnout makes shareholder approval obviously much trickier if Shell’s largest shareholder Capital Group (who have been switching from BG into Shell and understood to be getting close to 10% voting stake in Shell) would be opposing the deal. With already a divided shareholder base in a crude price collapsing world, ISS recommendation is becoming increasingly important. – CONDITION LANGUAGE: The Combination is conditional on, among other things, the Shell Resolution being passed by the requisite majority of Shell Shareholders at the Shell General Meeting, being more than 50 per cent. of the votes cast on the Shell ...

Continue Reading

06-Jan-16: Panta Event Note (Home Retail Group; PostNL; Bouygues) standard

– Home Retail Group (HOME LN): Besides various overnight editorial commentary on the deal rationale (or absence of it) for Sainsbury’s, The Times reported that Sainsbury’s “bear hug” of Home Retail could flush out rival bidders and believe that any offer would have to be pitched “at least at more than £1.1 billion” to merit “serious attention (Note: £1.1 bn offer is about Gbp 146 per share). Also very interestingly, Daily Mail reported that the 2 largest Home Retail shareholders, Schroders Investment Management and Toscafund Asset Management, with respectively a 20% and 5.5% stake, have become increasingly frustrated with Home Retail’s Board, and seem sympathetic to Sainsbury’s approach. With shareholders now coming out in favour of a Sainsbury approach, Home Retail is increasingly ...

Continue Reading

Home Retail Group plc (HOME LN): Sainsbury’s knocking on the door standard

– Home Retail Group plc (HOME LN): J Sainsbury plc (SBRY LN) just confirmed that it made an approach in November 2015 to Home Retail Group plc’s Board of Directors regarding a possible offer for Home Retail Group, in the form of Sainsbury‘s shares and cash. The approach was rejected by Home Retail Group and Sainsbury‘s is considering its position. No indication on what price level and/or consideration mix, with PUSU date set for 02 February 2016. We are slightly surprised by this leftfield announcement by Sainsbury’s (as we somehow question the rationale of bringing these 2 different retail models together under 1 roof). Home Retail’s M&A rumours have mainly circled around its Homebase segment (about 25% of Home Retail’s total revenues and EBITDA): as recently ...

Continue Reading

05-Jan-16: Panta Event Note (Bouygues; BG Group; Ten Cate; Kuoni Reisen) standard

– Bouygues (EN FP)/ Orange SA (ORA FP): Orange confirms this morning the well flagged rumours that it has renewed preliminary discussions with the Bouygues Group with a view to a consolidation with Bouygues Telecom. No indication on structure/pricing or timing. With i) Bouygues now having outperformed wider market by almost 15% since 08-Dec-15 rumours;  ii)  pre-rumour Bouygues EUR 34.5 pricing in already about EUR 8bn or EUR 23-24 per share for Bouygues’s Telecom assets; iii) Orange share price hardly moved since mid-Dec rumours of tie up started (despite any consideration understood to be 80% in Orange shares), and iv) any deal would be long dated with large execution/regulatory risk; would sell/short Bouygues here above EUR 38. – BG Group (BG/ LN): ...

Continue Reading

Kuoni Reisen Holding AG (KUNN SW): Break-up bid looming? standard

– Kuoni Reisen Holding AG (KUNN SW): After Bloomberg reported yesterday afternoon that EQT Partners has emerged as a strong contender among other financial investors to take Kuoni private, Kuoni confirmed this morning it has received preliminary approaches from third parties regarding a potential offer for the Kuoni Group and its businesses. These statements/rumours follow Nov-15 news that Kuoni had appointed a new CEO and mid-Dec Swiss reports that it had hired Credit Suisse and Morgan Stanley to examine options for the group and find potential buyers for any of the 3 group units. Kuoni currently consists of 3 units: i) Global Travel Distribution (GTD) which is a travel distributor that provides travel companies with  access to hotel accommodation and destination services. (CHF 2bn in revenues; low single digit margins; small single digit revenue growth; peers: Expedia/Priceline); ii) Global Travel Services (GTS) sources ...

Continue Reading

04-Jan-16: Panta Event Note (BG Group; Bouygues) standard

– BG Group (BG/ LN): UK newspaper Telegraph gave more editorial space to Ian McVeigh, head of governance at Jupiter Fund Management, who again likes to be leading the attack on the BG deal, and wants to lead the UK institutional investors in rethinking their role in the world… This follows earlier 2015 commentary by McVeigh likening the BG/Shell deal to the disastrous purchase of ABN Amro by Royal Bank of Scotland in 2007, soon before the financial crisis (we de-constructed some of his arguments in November). Although BG situation remains the most concentrated arb situation and will attract much more volatility and headlines in the next 3 weeks leading to the crucial Shell vote, we still remain convinced that this deal will pass (despite ...

Continue Reading

30-Dec-15: Panta Event Note (Melrose, Rexam) standard

– 2016 Event driven investment opportunities: Quote by Doug Hirsch who is closing his event-driven $500 million Seneca Capital:  “Despite negligible redemption requests and increasing market opportunities that are the result of a challenging year in event-driven investing, I cannot in good faith start next year with the dedication required to manage your capital.” – Melrose Industries plc (MRO LN): Melrose announced the completion of the £3.3bn disposal of its Elster business to Honeywell International Inc. yesterday and the proposed return of approximately £2.4 billion in cash to shareholders. The timing of deal closing is touch quicker than we had anticipated (as we saw good chance that EC could have launched a full Phase 2 investigation) and £2.4bn capital return is about £100m higher than original ...

Continue Reading

PostNL N.V. (PNL NA): Sceptical of near-term M&A interest standard

– PostNL (PNL NA): There were rumours in low quality source The Daily Mail last week on 24-Dec that Royal Mail was on the verge of bidding €5 a share for Dutch postal operator PostNL (or more than 50% premium vs previous closing price of €3.24), with Deutsche Post also said to be interested. Says it ‘could yet be a Christmas cracker, but word is it will now be rubber-stamped early in the new year.’ Despite company last week pouring cold water on that speculation, PostNL’s share price above €3.60 stubbornly has stayed up more than 10% vs pre-rumour pricing (most likely because of  ‘cheap’ headline standalone valuation and/or presence of well-followed Dutch media tycoon John De Mol in shareholder register with 5% stake). Although we appreciate ...

Continue Reading

22-Dec-15: Panta Event Note (USG People; Ten Cate; BG Group) standard

– USG People (USG NA):  Dutch recruitment firm USG people announced that Japanese Recruit Holdings Co (6098 JP) (with EV of around EUR 14bn) has made an all-cash bid on all outstanding USG shares for EUR 17.50 per share, valuing USG at around EUR 1.6bn. The bid is supported by the Executive and  Supervisory Board of USG and 19.8%  founding shareholder Alex Mulder.  Deal is conditional on typical Dutch (pre-)conditions like AFM approval, 95% shareholder acceptances (waivable) and required competition clearances. Offer closing targeted for 2Q16. Fully valued 30% premium bid valuing USG at 2015 and 2016 P/E of 24x and 16x and EV/EBITDA of 13x and 10.5x at 10-30% premium to direct peers Adecco and Randstad (blended trading at 2015 ...

Continue Reading

This is a unique website which will require a more modern browser to work!

Please upgrade today!