European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>White knight <a href="https://www.smartkarma.com/entities/georg-fischer-ag" target="_blank" data-smartkarma-citation="entities:22359:1" rel="noopener">Georg Fischer AG (FI/N SW)</a> announced a voluntary recommended public €28.85/share cash offer for <a href="https://www.smartkarma.com/entities/uponor-oyj" target="_blank" data-smartkarma-citation="entities:21787:1" rel="noopener">Uponor OYJ (UNR1V FH)</a>, a 12% premium to Aliaxis's offer, with c.37% irrevocable undertakings.</li>
<li>Although Aliaxis could still block a squeeze-out, GF and Uponor could make its life difficult and are granting it an honourable exit with capital gains around €55 million.</li>
<li>Spread is 0.52%/1.05% (gross/annualised, assuming settlement by mid-December). Although I believe the deal will close, it is probably not worth going long Uponor it on this spread level.</li>
</ul>


White knight Georg Fischer AG (FI/N SW) announced a voluntary recommended public €28.85/share cash offer for Uponor OYJ (UNR1V FH), a 12% premium to Aliaxis's offer, with c.37% irrevocable undertakings.
Although Aliaxis could still block a squeeze-out, GF and Uponor could make its life difficult and are granting it an honourable exit with capital gains around €55 million.
Spread is 0.52%/1.05% (gross/annualised, assuming settlement by mid-December). Although I believe the deal will close, it is probably not worth going long Uponor it on this spread level.


Georg Fischer/Uponor: Terms and Aliaxis's Honourable Exit

<ul>
<li>
<a href="https://www.smartkarma.com/entities/aliaxis-sa" target="_blank" data-smartkarma-citation="entities:21313:1" rel="noopener">Aliaxis SA (ALIVP BB)</a> seeks market expansion and by offering a 55% premium (€25.75/share,10.0x EV/Fwd EBITDA) it's quickly accumulated a 20% stake in <a href="https://www.smartkarma.com/entities/uponor-oyj" target="_blank" data-smartkarma-citation="entities:21787:1" rel="noopener">Uponor OYJ (UNR1V FH)</a>, whose Board isn't engaging.</li>
<li>The shares trade c.7% above the offer on expectations of others suitors, but the stake already owned by Aliaxis should act as a deterrent. My fair value estimate (EV/EBITDA) is €27.09/share.</li>
<li>The share price implies 6.6% perpetuity growth (in a mature industry) on a conservative 11.5% WACC. Oras (25% stake) isn't giving into temptation. Aliaxis'd be happy with another 30%.</li>
</ul>



Aliaxis SA (ALIVP BB) seeks market expansion and by offering a 55% premium (€25.75/share,10.0x EV/Fwd EBITDA) it's quickly accumulated a 20% stake in Uponor OYJ (UNR1V FH), whose Board isn't engaging.
The shares trade c.7% above the offer on expectations of others suitors, but the stake already owned by Aliaxis should act as a deterrent. My fair value estimate (EV/EBITDA) is €27.09/share.
The share price implies 6.6% perpetuity growth (in a mature industry) on a conservative 11.5% WACC. Oras (25% stake) isn't giving into temptation. Aliaxis'd be happy with another 30%.


Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Wisdomtree Japan Hedged Eq / Technical Analysis

Market dynamics continue to send mixed signals, but the bottom line is that not one MSCI ACWI Sector is breaking down, and important price support levels are holding in the US, Europe, and Japan. Additionally, the MSCI ACWI, ACWI ex-US, and EAFE indexes all remain above critical support levels. Until supports start to break we cannot be bearish. It is also worth noting that various indicators could be making a turn for the better, including early signs of interest rates bottoming in the US and Germany, a potential false breakdown in crude oil, and high yield spreads leveling-out.

Market dynamics continue to send mixed signals, but the bottom line is that not one MSCI ACWI Sector is breaking down, and important price support levels are holding in the US, Europe, and Japan. Additionally, the MSCI ACWI, ACWI ex-US, and EAFE indexes all remain above critical support levels. Until supports start to break we cannot be bearish. It is also worth noting that various indicators could be making a turn for the better, including early signs of interest rates bottoming in the US and Germany, a potential false breakdown in crude oil, and high yield spreads leveling-out.

Critical Supports Holding in the US, Europe, & Japan; Buying Health Care, Utilities, Materials, Tech

Risk-on signals continue to pile up, which continues to support our constructive outlook. Building off of last week's report, growth Sectors such as Technology and Communications continue to improve and we recommend adding exposure (e.g., Bilibili BILI-US/9626-HK).

Risk-on signals continue to pile up, which continues to support our constructive outlook. Building off of last week's report, growth Sectors such as Technology and Communications continue to improve and we recommend adding exposure (e.g., Bilibili BILI-US/9626-HK).

Global Equity Strategy: Growth Sectors Continue To Improve -- Add Exposure

Broad global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) were able to shrug off recent news of a more contagious Covid variant that popped-up in the UK. Additionally, Covid fears have done nothing to derail ongoing positive market dynamics. As long as support levels hold and market dynamics remain positive, our outlook remains bullish and we continue to view any weakness as a buying opportunity. Actionable Themes in today's report: Services, Technology, Manufacturing, and Materials.

Broad global indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) were able to shrug off recent news of a more contagious Covid variant that popped-up in the UK. Additionally, Covid fears have done nothing to derail ongoing positive market dynamics. As long as support levels hold and market dynamics remain positive, our outlook remains bullish and we continue to view any weakness as a buying opportunity. Actionable Themes in today's report: Services, Technology, Manufacturing, and Materials.

Global Equity Strategy: Support Levels Holding; Bullish Outlook Intact

Switzerland

Georg Fischer AG produces automobile parts, piping systems, plastics processing equipment, and tool and mold making machinery.  The Company manufactures cast and machined components for road vehicles and machinery, plastic and metal pipes and fittings, electric discharge machines, milling centers, automation equipment, and plastics factories and compounding systems.

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Georg Fischer AG (FI/N SW)

Georg Fischer/Uponor: Terms and Aliaxis's Honourable Exit

White knight Georg Fischer announced a voluntary recommended €28.85/share cash offer for Uponor, a 12% premium to Aliaxis's offer, with c.37%...

Jesus Rodriguez Aguilar

Aliaxis/Uponor: Hostile Offer

Aliaxis SA (ALIVP BB) seeks market expansion and by offering a 55% premium (€25.75/share,10.0x EV/Fwd EBITDA) it's quickly accumulated a 20% stake...

Jesus Rodriguez Aguilar

Critical Supports Holding in the US, Europe, & Japan; Buying Health Care, Utilities, Materials, Tech

Various indicators are making a turn for the better, including early signs of interest rates bottoming in the US and Germany, a false breakdown in...

Vermilion Research

Global Equity Strategy: Growth Sectors Continue To Improve -- Add Exposure

Building off of last week's report, growth Sectors such as Technology and Communications continue to improve and we recommend adding exposure...

Vermilion Research

Global Equity Strategy: Support Levels Holding; Bullish Outlook Intact

As long as support levels hold and market dynamics remain positive, our outlook remains bullish and we continue to view any weakness as a buying...

Vermilion Research

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