European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>KKR has agreed with Albioma on a €50/share+€0.84 dividend offer, €1,583 million implied equity value, c. €2,543 million implied EV. The consideration represents 11.4x EV/Fwd EBITDA and 25.1x Fwd P/E.</li>
<li>The multiples are not as rich as in the Falck transaction, but most shareholders will be happy to tender at a 52% premium. </li>
<li>Albioma closed at €50.7 (a 15.9% increase vs. the prior closing price). Gross spread is 0.28%, and the annual estimated return, assuming settlement by 5 August, is 1.03%, probably low.</li>
</ul>


KKR has agreed with Albioma on a €50/share+€0.84 dividend offer, €1,583 million implied equity value, c. €2,543 million implied EV. The consideration represents 11.4x EV/Fwd EBITDA and 25.1x Fwd P/E.
The multiples are not as rich as in the Falck transaction, but most shareholders will be happy to tender at a 52% premium. 
Albioma closed at €50.7 (a 15.9% increase vs. the prior closing price). Gross spread is 0.28%, and the annual estimated return, assuming settlement by 5 August, is 1.03%, probably low.


KKR / Albioma: Agreed Offer, Est. Timetable

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Last Week in Event SPACE: Singapore Air, Evergrande/Hopson, HomeCo/Aventus, Irongate, Shinsei Bank

Infrastructure Investments Fund, a vehicle advised by J.P. Morgan Investment Management, agreed to buy a 60% stake in <a href="https://www.smartkarma.com/entities/falck-renewables-spa" target="_blank" data-smartkarma-citation="entities:34071:1" rel="noopener">Falck Renewables SpA (FKR IM)</a> from Falck SpA, at €8.81/share. IIF is paying a premium of 29.2% to the 3-month VWAP. Deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic. 
Deal value (for the 60% stake) is c. €1,529 million; the implied equity value is c. €2,548 million and the implied EV is €3,508 million. Multiples: 8x EV/Fwd revenue, vs. the 6.3x median of previous sector transactions and 7.1x at which comps are trading, 16.3x EV/Fwd EBITDA and 59.6x Fwd P/E. Interest for renewables is very strong with pension funds investing in both solar and wind farms as well as clean energies projects, which is leading to large M&amp;A premiums.
IIF invests in infrastructure, with a focus on contracted energy assets and utilities. The deal will increase IIF's exposure in the renewable energies since Falck Renewables has exposure to Italy, the United Kingdom, Germany, France and other countries.
Falck Renewables said the stake transaction should complete by end of Q1 2022. Upon closing of the transaction, IIF will launch a mandatory cash tender offer for Falck Renewables’s remaining share capital at €8.81/share, with the intention to delist the company.
Fair valuation (multiples based) is €6.73/share, the level at which the share was trading prior to the deal announcement. On this basis, the premium offered implies a full price, in my view, and the market believes the deal will complete. The deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic.
On 20 October, Falck Renewables closed 14% higher. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

Infrastructure Investments Fund, a vehicle advised by J.P. Morgan Investment Management, agreed to buy a 60% stake in Falck Renewables SpA (FKR IM) from Falck SpA, at €8.81/share. IIF is paying a premium of 29.2% to the 3-month VWAP. Deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic. 
Deal value (for the 60% stake) is c. €1,529 million; the implied equity value is c. €2,548 million and the implied EV is €3,508 million. Multiples: 8x EV/Fwd revenue, vs. the 6.3x median of previous sector transactions and 7.1x at which comps are trading, 16.3x EV/Fwd EBITDA and 59.6x Fwd P/E. Interest for renewables is very strong with pension funds investing in both solar and wind farms as well as clean energies projects, which is leading to large M&amp;A premiums.
IIF invests in infrastructure, with a focus on contracted energy assets and utilities. The deal will increase IIF's exposure in the renewable energies since Falck Renewables has exposure to Italy, the United Kingdom, Germany, France and other countries.
Falck Renewables said the stake transaction should complete by end of Q1 2022. Upon closing of the transaction, IIF will launch a mandatory cash tender offer for Falck Renewables’s remaining share capital at €8.81/share, with the intention to delist the company.
Fair valuation (multiples based) is €6.73/share, the level at which the share was trading prior to the deal announcement. On this basis, the premium offered implies a full price, in my view, and the market believes the deal will complete. The deal authorization will be subject to Italian Government Golden Power, as the energy sector is deemed strategic.
On 20 October, Falck Renewables closed 14% higher. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

IIF/Falck Renewables: Acquisition of Majority Stake

Italy

Falck Renewables SpA produces energy from renewable sources. The Company is creating a portfolio of wind energy projects across Europe, focusing on certain key countries including the UK, Italy, Spain and France.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Falck Renewables SpA (FKR IM)

KKR / Albioma: Agreed Offer, Est. Timetable

Following two months of conversations, on 28 April, KKR said that it has agreed to launch a public tender offer for French renewables producer...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Singapore Air, Evergrande/Hopson, HomeCo/Aventus, Irongate, Shinsei Bank

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

IIF/Falck Renewables: Acquisition of Majority Stake

The premium offered implies a full price. Gross spread is an unexciting 1.4% for a mandatory offer that could take up to a year to complete.

Jesus Rodriguez Aguilar

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)