Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>On 23 August, Intel announced that it will partner with Canada's Brookfield Asset Management to jointly fund up to $30 billion to make advanced semiconductor chips in Arizona. </li>
<li>Despite Intel's aggressive plans to expand the semiconductor chip production, we are more concerned about the overall downturn in the semiconductor sector which lead to further decline in sales. </li>
<li>Despite our negative view of Intel's shares in the near term, Intel could gain market share versus Samsung and TSMC in the semiconductor sector in the next three years.</li>
</ul>


On 23 August, Intel announced that it will partner with Canada's Brookfield Asset Management to jointly fund up to $30 billion to make advanced semiconductor chips in Arizona. 
Despite Intel's aggressive plans to expand the semiconductor chip production, we are more concerned about the overall downturn in the semiconductor sector which lead to further decline in sales. 
Despite our negative view of Intel's shares in the near term, Intel could gain market share versus Samsung and TSMC in the semiconductor sector in the next three years.


Intel's $30 Billion JV with Brookfield Asset Mgmt: To Take Away Market Share from TSMC & Samsung?

European Event-Driven Analyst

Jesus Rodriguez Aguilar

<ul>
<li>Media reports that HomeServe and Brookfield are close to reaching an agreement. Since news of the approach broke, the share price of HomeServe has increased by c. 52%.</li>
<li>My fair value estimate (DCF based) is 1,206p, which could presumably be enough for the founder to sell its 12.1% stake (enough to prevent a squeeze-out).</li>
<li>At1,206p (71% premium to the price prior to disclosures), a financial buyer could obtain a 15.3% cumulative IRR by year 8. <strong>Long HSV LN</strong>.</li>
</ul>


Media reports that HomeServe and Brookfield are close to reaching an agreement. Since news of the approach broke, the share price of HomeServe has increased by c. 52%.
My fair value estimate (DCF based) is 1,206p, which could presumably be enough for the founder to sell its 12.1% stake (enough to prevent a squeeze-out).
At1,206p (71% premium to the price prior to disclosures), a financial buyer could obtain a 15.3% cumulative IRR by year 8. Long HSV LN.


Brookfield/HomeServe Close to Reaching an Agreement

Writing about High Quality Companies, Enlightened Capital

Enlightened Capital

Writing about High Quality Companies

I have more than 8 years of investing experience across Equities and Fixed Income (Investment Grade/High Yield). I have largely focused on Financials, Energy, and Utilities professionally, but I am interested in exploring new sectors to find attractive opportunities. Right now, the Payments sector is occupying much of my time.

Equity Bottom-Up

Apollo Global Management  / Equity Bottom-Up

<ul><li>APO is a top 5 alternative asset manager globally with $513bn of AUM as of 1Q22.</li><li>APO’s AUM is diversified across 73% of AUM in Yield strategies, 17% in Equity strategies, and 10% in Hybrid strategies.</li><li>APO recently acquired the remaining 65% of Athene (ATH), for $10.4bn (6x ’22 EPS), adding ~$200bn of insurance liabilities to APO’s balance sheet including fixed indexed annuities, fixed annuities, group annuities, and funding agreements.</li></ul>

APO is a top 5 alternative asset manager globally with $513bn of AUM as of 1Q22.APO’s AUM is diversified across 73% of AUM in Yield strategies, 17% in Equity strategies, and 10% in Hybrid strategies.APO recently acquired the remaining 65% of Athene (ATH), for $10.4bn (6x ’22 EPS), adding ~$200bn of insurance liabilities to APO’s balance sheet including fixed indexed annuities, fixed annuities, group annuities, and funding agreements.

<ul>
<li>GIP/Brookfield/ACS weigh launching a €15 billion unsolicited offer for Atlantia. Blackstone may partner with the Benettons to acquire Atlantia at €24/share (26% premium ). Italian Government's role will be key.</li>
<li>Atlantia trades at higher multiples than ACS (EV/22e EBITDA: 12.8x vs 3.2x, Capital IQ consensus). A hypothetical ACS/Abertis would become a world leader in infrastructure, but leverage is key. </li>
<li>The opposition of Edizione makes the operation difficult/more expensive. A joint-bid Edizione/Blackstone, would force the GIP-led group to present an improved offer. Nearly 50% of Atlantia's NAV is cash.</li>
</ul>


GIP/Brookfield/ACS weigh launching a €15 billion unsolicited offer for Atlantia. Blackstone may partner with the Benettons to acquire Atlantia at €24/share (26% premium ). Italian Government's role will be key.
Atlantia trades at higher multiples than ACS (EV/22e EBITDA: 12.8x vs 3.2x, Capital IQ consensus). A hypothetical ACS/Abertis would become a world leader in infrastructure, but leverage is key. 
The opposition of Edizione makes the operation difficult/more expensive. A joint-bid Edizione/Blackstone, would force the GIP-led group to present an improved offer. Nearly 50% of Atlantia's NAV is cash.


<ul>
<li>Brookfield has agreed to acquire (scheme of arrangement) underperforming Hibernia REIT at €1.60 + €0.034 dividend, a 35.6% premium and 5.7% discount to EPRA NTA (above other recent deals in the sector).</li>
<li>Hibernia's shares are trading at 0.92x BVPS; the offer represents a premium to peers both on trailing and forward 12-month EV/revenue. Capital IQ consensus expects little improvement in EPS growth.</li>
<li>Consideration looks fair and terms are final (except in case of competing offers). Gross spread is 1.22%, 6.54% annualised (assuming settlement on 15 June). <strong>Long HBRN ID</strong>.</li>
</ul>


Brookfield has agreed to acquire (scheme of arrangement) underperforming Hibernia REIT at €1.60 + €0.034 dividend, a 35.6% premium and 5.7% discount to EPRA NTA (above other recent deals in the sector).
Hibernia's shares are trading at 0.92x BVPS; the offer represents a premium to peers both on trailing and forward 12-month EV/revenue. Capital IQ consensus expects little improvement in EPS growth.
Consideration looks fair and terms are final (except in case of competing offers). Gross spread is 1.22%, 6.54% annualised (assuming settlement on 15 June). Long HBRN ID.


Brookfield/Hibernia REIT: Agreed Fair Offer

Canada

Brookfield Asset Management Ltd. operates as an investment management firm. The Company focuses on property development, renewable energy, infrastructure, insurance, and private equity. Brookfield Asset Management serves customers worldwide.

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Brookfield Asset Management Lt (BAM US)

Brookfield/HomeServe Close to Reaching an Agreement

HomeServe and Brookfield are close to reaching an agreement (around 1200p). Since news of the approach broke, the shares have had an excellent run...

Jesus Rodriguez Aguilar

Apollo Global (APO)

APO is a top 5 alternative asset manager globally with $513bn of AUM as of 1Q22. APO’s AUM is diversified across 73% of AUM in Yield strategies,...

Enlightened Capital

Atlantia in Play?

The GIP/Brookfield/ACS deal seems a priori difficult, due to the size of Atlantia (for ACS) but above all because of the possibility that the...

Jesus Rodriguez Aguilar

Brookfield/Hibernia REIT: Agreed Fair Offer

Brookfield agreed to acquire Hibernia Reit for €1.09 billion (scheme of agreement). The board of Hibernia recommends shareholders accept what I...

Jesus Rodriguez Aguilar

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52-week Range

Market Cap (USDm)

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Intel's $30 Billion JV with Brookfield Asset Mgmt: To Take Away Market Share from TSMC & Samsung?

On 23 August, Intel announced that it will partner with Canada's Brookfield Asset Management to jointly fund up to $30 billion to make advanced...

Douglas Kim

Brookfield/HomeServe Close to Reaching an Agreement

HomeServe and Brookfield are close to reaching an agreement (around 1200p). Since news of the approach broke, the shares have had an excellent run...

Jesus Rodriguez Aguilar

Apollo Global (APO)

APO is a top 5 alternative asset manager globally with $513bn of AUM as of 1Q22. APO’s AUM is diversified across 73% of AUM in Yield strategies,...

Enlightened Capital

Atlantia in Play?

The GIP/Brookfield/ACS deal seems a priori difficult, due to the size of Atlantia (for ACS) but above all because of the possibility that the...

Jesus Rodriguez Aguilar

Brookfield/Hibernia REIT: Agreed Fair Offer

Brookfield agreed to acquire Hibernia Reit for €1.09 billion (scheme of agreement). The board of Hibernia recommends shareholders accept what I...

Jesus Rodriguez Aguilar