– Rexam plc (REX LN): Encouraging FY15 published numbers for what is supposed to be Rexam’s last set of (public) numbers, with total revenues having risen from £3,832m to £3,925m (consensus £3,919m) and underlying EBIT having fallen only from £418m to £404m (consensus £409.5m), and underlying EPS of continuing businesses increasing from 37.2p to 39.1p (consensus 37.9p). Confirmation of additional dividend of Gbp 11.9 on top of offer consideration, with ex-dividend date set for 08-Apr-16. Company also confirms that anticipated completion of the Ball deal is towards the end of the first half of 2016. Although these numbers largely confirm (slightly 1-2% improving) 15-20% break downside to around Gbp 500 levels (please contact us at email@example.com for more detailed downside analysis), this should be largely non-event, with all focus on global sale process of divested assets.
– Darty plc (DRTY LN) / FNAC Groupe (FNAC FP): Both FNAC and Darty reported decent numbers this morning (with Darty doing better than FNAC): 1) Darty reported strong 3Q15 top-line numbers for the period 1 November 2015 to 31 January 2016 with revenues +2.6% (like-for-like sales +2.7%) vs last year, mainly driven by very strong 4.4% like for like sales in in France, which were partially offset by negative performance in Belgium/Netherlands; and 2) FNAC reported mixed FY15 numbers with Net income having risen to €48.0M from €41.3M in 2014, however on slightly negative like for like sales. Numbers largely non-event for deal (spread), however strong Darty numbers show why FNAC would want to close on this deal, with FNAC commenting that ‘acquisition process continues to proceed in accordance with the timetable presented when the Proposed Aquisition was announced on November 20, 2015. The French Competition Authority in France was formally notified on February 17, 2016. The group has planned to notify the Belgian Competition Authority within the next few days.’ Still trading at 10%+ net spread (which would translate to more than 20%+ pa if we would assume summer 2016 closing in line with FNAC’s CEO comments on deal closing), this continues to represent solid and attractive spread.
– Syngenta AG (SYNN VX): Overly worried editorial/commentary that there might be negative read-across for Chemchina’s offer for Syngenta on the back of 2 Chinese buyers having to walk away from their respective overseas acquisitions (US semiconductor Fairchild semiconductor and Israel Phoenix holdings). Each of these situations should be evaluated in their respective context, and we cannot see any immediate direct relevant read-through for Syngenta.