European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>KKR offers €17.50/share for <a href="https://www.smartkarma.com/entities/encavis-ag" target="_blank" data-smartkarma-citation="entities:21595:1" rel="noopener">Encavis AG (ECV GR)</a>, 53% premium, implied equity value of €2,818 million. This shows interest in renewables after the falls on the stock market in 2023-24.</li>
<li>The offer represents 12.7x EV/Fwd NTM EBITDA and 32.4x Fwd P/E. On  a P/E basis, the offer seems fair vs. (depressed) comparables.</li>
<li>Given the current negative perception surrounding renewable energy companies, I think the shareholders are likely to tender at an attractive price. Spread is 3.77%/5.24% (gross/anualised, assuming closing by mid-December).</li>
</ul>


KKR offers €17.50/share for Encavis AG (ECV GR), 53% premium, implied equity value of €2,818 million. This shows interest in renewables after the falls on the stock market in 2023-24.
The offer represents 12.7x EV/Fwd NTM EBITDA and 32.4x Fwd P/E. On  a P/E basis, the offer seems fair vs. (depressed) comparables.
Given the current negative perception surrounding renewable energy companies, I think the shareholders are likely to tender at an attractive price. Spread is 3.77%/5.24% (gross/anualised, assuming closing by mid-December).


<ul>
<li>On June 24, a share purchase agreement was signed between Brookfield and several shareholders, to acquire 53.12% of Neoen's outstanding shares at €39.85/share. Brookfield has also received irrevocables for 4.36%.</li>
<li>The offer price is generous and this looks a done deal. Spread 5.19%/7.29% (gross/annualised) seems interesting in spite of the longer approval process in energy deals.</li>
<li>The convertible NEOEN 2.875 14-SEP-2027 has a balanced profile. It is trading at (mid) 100.75 (vs. €37.82), vs. a fair price estimate of 113.773.</li>
</ul>


On June 24, a share purchase agreement was signed between Brookfield and several shareholders, to acquire 53.12% of Neoen's outstanding shares at €39.85/share. Brookfield has also received irrevocables for 4.36%.
The offer price is generous and this looks a done deal. Spread 5.19%/7.29% (gross/annualised) seems interesting in spite of the longer approval process in energy deals.
The convertible NEOEN 2.875 14-SEP-2027 has a balanced profile. It is trading at (mid) 100.75 (vs. €37.82), vs. a fair price estimate of 113.773.


Brookfield/Neoen: Share Purchase Agreement, Spread and Convertibles

<ul>
<li>
<a href="https://www.smartkarma.com/entities/brookfield-corp-e3b4f84d-56b4-4ae2-87f3-1c3e83138aea" target="_blank" data-smartkarma-citation="entities:25297:1" rel="noopener">Brookfield (BN CN)</a> has entered exclusive negotiations with the top shareholders of <a href="https://www.smartkarma.com/entities/neoen-sa" target="_blank" data-smartkarma-citation="entities:33002:1" rel="noopener">Neoen (NEOEN FP)</a> to acquire a 53.32% stake at €39.85/share, 26.9% premium, which will trigger a mandatory offer.</li>
<li>The offer represents 15.1x EV/NTM Fwd EBITDA vs. the median of peers at 9.3x. My fair-value estimate (DCF-based) is €33.76/share, therefore the offer is generous, in my view.</li>
<li>Expect the shares to close the spread tomorrow and trade around 3% gross spread and the convertibles to price higher (2% 06/25 at around €51.85, 2.875% 09/27 around 111.72%).</li>
</ul>



Brookfield (BN CN) has entered exclusive negotiations with the top shareholders of Neoen (NEOEN FP) to acquire a 53.32% stake at €39.85/share, 26.9% premium, which will trigger a mandatory offer.
The offer represents 15.1x EV/NTM Fwd EBITDA vs. the median of peers at 9.3x. My fair-value estimate (DCF-based) is €33.76/share, therefore the offer is generous, in my view.
Expect the shares to close the spread tomorrow and trade around 3% gross spread and the convertibles to price higher (2% 06/25 at around €51.85, 2.875% 09/27 around 111.72%).


Brookfield to Launch Mandatory Offer for Neoen

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

<ul>
<li>In this insight, we take a look at the potential ADDs/DELs for the DAX index and the MDAX index in the run up to the June 2024 index rebal event.</li>
<li>There could be two regular MDAX changes in June including the long-anticipated deletion of M&amp;A candidate <a href="https://www.smartkarma.com/entities/morphosys-ag" target="_blank" data-smartkarma-citation="entities:21675:1" rel="noopener">MorphoSys AG (MOR GR)</a>. </li>
<li>We do not see any changes for the DAX index based on the current numbers.</li>
</ul>


In this insight, we take a look at the potential ADDs/DELs for the DAX index and the MDAX index in the run up to the June 2024 index rebal event.
There could be two regular MDAX changes in June including the long-anticipated deletion of M&amp;A candidate MorphoSys AG (MOR GR). 
We do not see any changes for the DAX index based on the current numbers.


Quiddity Leaderboard DAX/MDAX Jun 24: Hellofresh MDAX Deletion Hinges on Encavis Tender Offer Result

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

<ul>
<li>Even if you were an activist, or a trader with an activism tilt, be long <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> vs. <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a>.</li>
<li>Reportedly, <a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a> is negotiating a sale of Optus. Both Singtel and Optus scotch those rumours. </li>
<li>
<a href="https://www.smartkarma.com/entities/alumina-ltd" target="_blank" data-smartkarma-citation="entities:939:1" rel="noopener">Alumina Ltd (AWC AU)</a> and <a href="https://www.smartkarma.com/entities/alcoa-corp" target="_blank" data-smartkarma-citation="entities:6510:1" rel="noopener">Alcoa (AA US)</a> enter into a Scheme. As expected. The key question: is CITIC, with 18.9% of shares out, supportive?</li>
</ul>


Even if you were an activist, or a trader with an activism tilt, be long Keisei Electric Railway Co (9009 JP) vs. Oriental Land (4661 JP).
Reportedly, Singtel (ST SP) is negotiating a sale of Optus. Both Singtel and Optus scotch those rumours. 

Alumina Ltd (AWC AU) and Alcoa (AA US) enter into a Scheme. As expected. The key question: is CITIC, with 18.9% of shares out, supportive?


Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning

Germany

Encavis AG provides electricity generation from power plants. The Company produces power from renewable energy sources which includes solar energy plants and wind farms, as well as specializes in the technical operation of solar parks, routine maintenance, monitoring, incident management, and performance analysis. Encavis serves renewable energy sector in Europe.

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Encavis AG (ECV GR)

KKR/Encavis AG: Voluntary Offer

KKR offers €17.50/share for Encavis AG, showing interest in renewables post-stock market falls. Offer seems fair vs. comparables. Shareholders...

Jesus Rodriguez Aguilar

Brookfield to Launch Mandatory Offer for Neoen

Brookfield (BN CN) has entered exclusive negotiations with the top shareholders of Neoen (NEOEN FP) to acquire a 53.32% stake at €39.85/share,...

Jesus Rodriguez Aguilar

Quiddity Leaderboard DAX/MDAX Jun 24: Hellofresh MDAX Deletion Hinges on Encavis Tender Offer Result

Hellofresh could be deleted from the MDAX index in June 2024. However, this depends on the final outcome of the Encavis Tender Offer.

Janaghan Jeyakumar, CFA

Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

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52-week Range

Market Cap (USDm)

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Dividend (Yield)

KKR/Encavis AG: Voluntary Offer

​KKR offers €17.50/share for Encavis AG, showing interest in renewables post-stock market falls. Offer seems fair vs. comparables. Shareholders...

Jesus Rodriguez Aguilar

Brookfield/Neoen: Share Purchase Agreement, Spread and Convertibles

On June 24, a share purchase agreement was signed between Brookfield and several shareholders, to acquire 53.12% of Neoen's outstanding shares at...

Jesus Rodriguez Aguilar

Brookfield to Launch Mandatory Offer for Neoen

Brookfield (BN CN) has entered exclusive negotiations with the top shareholders of Neoen (NEOEN FP) to acquire a 53.32% stake at €39.85/share,...

Jesus Rodriguez Aguilar

Quiddity Leaderboard DAX/MDAX Jun 24: Hellofresh MDAX Deletion Hinges on Encavis Tender Offer Result

Hellofresh could be deleted from the MDAX index in June 2024. However, this depends on the final outcome of the Encavis Tender Offer.

Janaghan Jeyakumar, CFA

Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

KKR offers €17.50/share for Encavis AG, showing interest in renewables post-stock market falls. Offer seems fair vs. comparables. Shareholders...