European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

On 30 July, Xavier Niel, co-founder and controlling shareholder of <a href="https://www.smartkarma.com/entities/iliad-sa" target="_blank" data-smartkarma-citation="entities:21486:1" rel="noopener">Iliad SA (ILD FP)</a> (70.63% of the share capital and 78.67% of the voting rights) launched a simplified public tender offer for the remaining iliad stake he does not own.
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The offer price will be €182/share, a premium of 61.0% on the closing share price on the prior trading session, c. 50% premium to the 1-month VWAP and 52.7% to the 3-month VWAP.
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<li>
This offer for the remaining 29.37% signals Niel's belief that iliad is undervalued, as per the typical “From now on, a new phase of development for Iliad will require quicker transformations and significant investments that will be easier to carry out as a private company,” Niel said in a statement. “Our ambition for Iliad is to accelerate to become a leader in telecommunications in Europe.”
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Niel had previously boosted its stake in 2019 by buying at €120/share as the stock stagnated at nearly half its all-time highs.
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It is a similar move to that carried out by Patrick Drahi, when he took private Altice Europe (see <a href="https://www.smartkarma.com/insights/altice-next-private-takeover-announcement" target="_blank" data-smartkarma-citation="insights:43240" rel="noopener">Altice - Next Private Takeover Announcement</a> and <a href="https://www.smartkarma.com/insights/altice-next-private-trading-above-terms" target="_blank" data-smartkarma-citation="insights:45873" rel="noopener">Altice - Next Private: Trading Above Terms</a>), because of low valuations of European telecoms. Private equity has been circling <a href="https://www.smartkarma.com/entities/koninklijke-kpn-nv" target="_blank" data-smartkarma-citation="entities:21122:1" rel="noopener">Koninklijke KPN (KPN NA)</a> and KKR (in a consortium) has taken over <a href="https://www.smartkarma.com/entities/masmovil-ibercom-sa" target="_blank" data-smartkarma-citation="entities:29013:1" rel="noopener">Masmovil Ibercom SA (MAS SM)</a> and indirectly it is acquiring <a href="https://www.smartkarma.com/entities/euskaltel-sa" target="_blank" data-smartkarma-citation="entities:21263:1" rel="noopener">Euskaltel SA (EKT SM)</a>.
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<li>Niel has bridge financing which should be comfortably refinanced with high-yield debt. He will be receiving c. €178 mn in dividends from FY2021e.</li>
</ul>
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Since November 2020, iliad's shares have lost nearly a third of their value, both on investor concerns about investments in Italy and price wars in France. European telecoms will also need to carry out significant capex for the 5G deployment and upgrade networks to high-speed fibre.
This is essentially an opportunistic bid, as Xavier Niel thinks the market is undervaluing his company, coupled with the planned Capex investments. This is not too disimilar to the <a href="https://www.smartkarma.com/entities/kaz-minerals-plc" target="_blank" data-smartkarma-citation="entities:21999:1" rel="noopener">KAZ Minerals (KAZ LN)</a> takeout offer.
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iliad has growth ambitions in Poland  to become a convergent player and on 30 July submitted an indicative bid to fully acquire <span title="" data-toggle="tooltip" data-offset="10%" data-trigger="manual" data-html="true" data-container="body" data-template='&lt;div class="tooltip" role="tooltip"&gt;&lt;div class="news-article-tooltip-arrow tooltip-arrow"&gt;&lt;/div&gt;&lt;div class="tooltip-inner"&gt;&lt;/div&gt;&lt;/div&gt;' data-original-title="">Liberty-Global-owned <span title="" data-toggle="tooltip" data-offset="10%" data-trigger="manual" data-html="true" data-container="body" data-template='&lt;div class="tooltip" role="tooltip"&gt;&lt;div class="news-article-tooltip-arrow tooltip-arrow"&gt;&lt;/div&gt;&lt;div class="tooltip-inner"&gt;&lt;/div&gt;&lt;/div&gt;' data-original-title="">UPC Poland. The indicative bid values the Polish operator at 7.3 billion Polish zlotys. iliad said the valuation is based on EBITDA of 782 million zlotys this year for UPC Poland. iliad is debating whether to acquire a broadband operator in the Polish market, or establishing its own broadband company to deploy optic fiber technology in Poland. This follows on the September 2020 acquisition of <a href="https://www.smartkarma.com/entities/play-communications-sa" target="_blank" data-smartkarma-citation="entities:29661:1" rel="noopener">Play Communications SA (1P1 GR)</a> for €3.5 billion (<a href="https://www.smartkarma.com/insights/play-communications-iliad-offer-announcement" target="_blank" data-smartkarma-citation="insights:43457" rel="noopener">Play Communications - Iliad: Offer Announcement</a>).
The takeout and delisting of iliad represents an opportunity for Xavier Niel. The 5G capex schedule   and fiber broadband upgrades will require heavy investments that are discouraging investors from increasing positions in reportedly cheap European telcos. At the same time, it has been the large American tech companies that have reaped the benefits of the higher internet traffic.
The offer represents c. 4.9% CF yield and the shares are trading at c. 6.5x on 2021E EV/EBITDAaL. Although the offer is interesting, and will likely receive majority of acceptances, my estimate of fair value (DCF based) is €190.7/share, which represents a 4.7% upside to the offer price. Market seems to await a sweetened bid. On this basis, and considering the risk/reward, my recommendation is Long ILD FP.
iliad's shares closed, on 30 July, 61% higher at €182.05, just above the offer price, giving it a market cap of c. €10.85b n.
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On 30 July, Xavier Niel, co-founder and controlling shareholder of Iliad SA (ILD FP) (70.63% of the share capital and 78.67% of the voting rights) launched a simplified public tender offer for the remaining iliad stake he does not own.



The offer price will be €182/share, a premium of 61.0% on the closing share price on the prior trading session, c. 50% premium to the 1-month VWAP and 52.7% to the 3-month VWAP.


This offer for the remaining 29.37% signals Niel's belief that iliad is undervalued, as per the typical “From now on, a new phase of development for Iliad will require quicker transformations and significant investments that will be easier to carry out as a private company,” Niel said in a statement. “Our ambition for Iliad is to accelerate to become a leader in telecommunications in Europe.”


Niel had previously boosted its stake in 2019 by buying at €120/share as the stock stagnated at nearly half its all-time highs.


It is a similar move to that carried out by Patrick Drahi, when he took private Altice Europe (see Altice - Next Private Takeover Announcement and Altice - Next Private: Trading Above Terms), because of low valuations of European telecoms. Private equity has been circling Koninklijke KPN (KPN NA) and KKR (in a consortium) has taken over Masmovil Ibercom SA (MAS SM) and indirectly it is acquiring Euskaltel SA (EKT SM).

Niel has bridge financing which should be comfortably refinanced with high-yield debt. He will be receiving c. €178 mn in dividends from FY2021e.


Since November 2020, iliad's shares have lost nearly a third of their value, both on investor concerns about investments in Italy and price wars in France. European telecoms will also need to carry out significant capex for the 5G deployment and upgrade networks to high-speed fibre.
This is essentially an opportunistic bid, as Xavier Niel thinks the market is undervaluing his company, coupled with the planned Capex investments. This is not too disimilar to the KAZ Minerals (KAZ LN) takeout offer.


iliad has growth ambitions in Poland  to become a convergent player and on 30 July submitted an indicative bid to fully acquire Liberty-Global-owned UPC Poland. The indicative bid values the Polish operator at 7.3 billion Polish zlotys. iliad said the valuation is based on EBITDA of 782 million zlotys this year for UPC Poland. iliad is debating whether to acquire a broadband operator in the Polish market, or establishing its own broadband company to deploy optic fiber technology in Poland. This follows on the September 2020 acquisition of Play Communications SA (1P1 GR) for €3.5 billion (Play Communications - Iliad: Offer Announcement).
The takeout and delisting of iliad represents an opportunity for Xavier Niel. The 5G capex schedule   and fiber broadband upgrades will require heavy investments that are discouraging investors from increasing positions in reportedly cheap European telcos. At the same time, it has been the large American tech companies that have reaped the benefits of the higher internet traffic.
The offer represents c. 4.9% CF yield and the shares are trading at c. 6.5x on 2021E EV/EBITDAaL. Although the offer is interesting, and will likely receive majority of acceptances, my estimate of fair value (DCF based) is €190.7/share, which represents a 4.7% upside to the offer price. Market seems to await a sweetened bid. On this basis, and considering the risk/reward, my recommendation is Long ILD FP.
iliad's shares closed, on 30 July, 61% higher at €182.05, just above the offer price, giving it a market cap of c. €10.85b n.




Xavier Niel/Iliad: An Offer Shareholders Can't Refuse?

The tender offer period for <a href="https://www.smartkarma.com/entities/cerved-group-s-p-a" target="_blank" data-smartkarma-citation="entities:21171:1" rel="noopener">Cerved Group S.p.A. (CERV IM)</a> has started, and will end on 5 August. On 16 July, the first day, the shares closed at €10.04, 5.7% above the offer price and in line with my prior TP of €10/share (see <a href="https://www.smartkarma.com/insights/cerved-group-castor-srl-sweet-opportunity-in-loans-gone-sour" target="_blank" data-smartkarma-citation="insights:48990" rel="noopener">Cerved Group - Castor Srl: Sweet Opportunity in Loans Gone Sour</a>).
The Board of Cerved says that the offer from Castor Bidco is inadequate and does not take into account the growth prospects of Cerved, sale of Cerved Management Group, synergies, the premium is low and the bid opportunistic.
Activist investor Berry Street has said it will not tender its 3% stake at the current bid price. Berry Street previously held 1% of <a href="https://www.smartkarma.com/entities/kaz-minerals-plc" target="_blank" data-smartkarma-citation="entities:21999:1" rel="noopener">KAZ Minerals (KAZ LN)</a>, whose takeover offer was increased by c. 36%.
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Castor stated in the announcement that in the event that, following the offer, the offeror comes to hold a total stake greater than 90%, but lower than 95%, the offeror will not restore a free float sufficient to ensure regular trading.
If as a result of the offer, the offeror holds at least 95% of the shares, it will exercise its right to purchase the remaining Cerved Shares. If the right to purchase is exercised, Borsa Italiana will order the suspension from listing and/or the delisting of Cerved Shares. If several shareholders collectively own above 5% of the share capital, they may block a hypothetical squeeze-out.
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I revise upwards my initial €10.0/share valuation of Cerved on a standalone basis. By using inputs from Capital IQ consensus (revenue, EBITDA, Capex), WACC of 8%, 11.5x EV/EBITDA exit multiple and g=2%, my new estimate of fair value on a standalone-basis is €11.04/share, this is a c.10% upside to the current market price and c. 16% above the current offer price. For comparison, mean TP on Capital IQ consensus is €10.23/share.
The market awaits a sweetened offer, which is highly likely in my view. An increase would be justified by better prospects and synergies, which equally split could be worth up to €0.455/share and there is some PE interloper risk. Long CERV IM.
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The tender offer period for Cerved Group S.p.A. (CERV IM) has started, and will end on 5 August. On 16 July, the first day, the shares closed at €10.04, 5.7% above the offer price and in line with my prior TP of €10/share (see Cerved Group - Castor Srl: Sweet Opportunity in Loans Gone Sour).
The Board of Cerved says that the offer from Castor Bidco is inadequate and does not take into account the growth prospects of Cerved, sale of Cerved Management Group, synergies, the premium is low and the bid opportunistic.
Activist investor Berry Street has said it will not tender its 3% stake at the current bid price. Berry Street previously held 1% of KAZ Minerals (KAZ LN), whose takeover offer was increased by c. 36%.

Castor stated in the announcement that in the event that, following the offer, the offeror comes to hold a total stake greater than 90%, but lower than 95%, the offeror will not restore a free float sufficient to ensure regular trading.
If as a result of the offer, the offeror holds at least 95% of the shares, it will exercise its right to purchase the remaining Cerved Shares. If the right to purchase is exercised, Borsa Italiana will order the suspension from listing and/or the delisting of Cerved Shares. If several shareholders collectively own above 5% of the share capital, they may block a hypothetical squeeze-out.


I revise upwards my initial €10.0/share valuation of Cerved on a standalone basis. By using inputs from Capital IQ consensus (revenue, EBITDA, Capex), WACC of 8%, 11.5x EV/EBITDA exit multiple and g=2%, my new estimate of fair value on a standalone-basis is €11.04/share, this is a c.10% upside to the current market price and c. 16% above the current offer price. For comparison, mean TP on Capital IQ consensus is €10.23/share.
The market awaits a sweetened offer, which is highly likely in my view. An increase would be justified by better prospects and synergies, which equally split could be worth up to €0.455/share and there is some PE interloper risk. Long CERV IM.


Trading Above Terms at the Start of the Tender Offer Period

On 26 March, the last day to revise the previous bid under UK takeover rules, <a href="https://www.kazminerals.com/en/repository/news-container/news/2021/final-increased-cash-offer/" target="_blank" rel="noopener">Nova Resources increased its offer</a> from 780p to 850p for the 60.62% of <a href="https://www.smartkarma.com/entities/kaz-minerals-plc" target="_blank" data-smartkarma-citation="entities:21999:1" rel="noopener">KAZ Minerals (KAZ LN)</a> it does not already own, the offer includes a special dividend of $0.27 subject to the final increased offer becoming unconditional.
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<li>The Final Increased Offer represents an aggregate amount of 869p, according to the release.</li>
<li>The financial terms are final and will not be increased.</li>
<li>That is the second increase to its original offer, and it represents a 33% vs. the first offer.</li>
<li>The improved offer values the equity of KAZ at £4,012 mn (not including the special dividend), and 4.8x EV/21e EBITDA (vs. 5.6x for the initial offer, the Capital IQ consensus 2021e EBITDA has since been revised upwards by c. 26%). It is also a 4.5% discount to the median Ind. NAVPS (Capital IQ consensus).</li>
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In my 5 February Insight (<a href="https://www.smartkarma.com/insights/kaz-minerals-sweetened-offer-but-maybe-not-convincing-enough" target="_blank" data-smartkarma-citation="insights:47800" rel="noopener">KAZ Minerals: Sweetened Offer but Maybe Not Convincing Enough</a>) I had mentioned that the 4 February sweetened offer was not final and that an improved offer could come and would take into account the lower end of what investors estimate Baimskaya is worth, an equity value of 846p.
Chinese demand is contributing to the copper price increases. The spot price of copper reached a 5-year high on 25 February 2021 of $9,456/t.
Deadline to accept the offer is 13.00 (London time) on 9 April, two weeks from now, which translates the pressure to either accept the improved and final offer (a good return from the first offer) or let it lapse and trust Chinese demand will keep on pushing copper prices.
In the absence of any material change, I believe this is it (and a good run from the initial offer). Kim and Novachuk will have the company for themselves (with its commodity and political risks) and shareholders have (fairly) grabbed a 33% increase (part of the future FCF from Baimskaya). Recommendation is Long KAZ TP 869 and tender. Gross spread is 0.57%, or c. 2.3% annualized.

On 26 March, the last day to revise the previous bid under UK takeover rules, Nova Resources increased its offer from 780p to 850p for the 60.62% of KAZ Minerals (KAZ LN) it does not already own, the offer includes a special dividend of $0.27 subject to the final increased offer becoming unconditional.

The Final Increased Offer represents an aggregate amount of 869p, according to the release.
The financial terms are final and will not be increased.
That is the second increase to its original offer, and it represents a 33% vs. the first offer.
The improved offer values the equity of KAZ at £4,012 mn (not including the special dividend), and 4.8x EV/21e EBITDA (vs. 5.6x for the initial offer, the Capital IQ consensus 2021e EBITDA has since been revised upwards by c. 26%). It is also a 4.5% discount to the median Ind. NAVPS (Capital IQ consensus).

In my 5 February Insight (KAZ Minerals: Sweetened Offer but Maybe Not Convincing Enough) I had mentioned that the 4 February sweetened offer was not final and that an improved offer could come and would take into account the lower end of what investors estimate Baimskaya is worth, an equity value of 846p.
Chinese demand is contributing to the copper price increases. The spot price of copper reached a 5-year high on 25 February 2021 of $9,456/t.
Deadline to accept the offer is 13.00 (London time) on 9 April, two weeks from now, which translates the pressure to either accept the improved and final offer (a good return from the first offer) or let it lapse and trust Chinese demand will keep on pushing copper prices.
In the absence of any material change, I believe this is it (and a good run from the initial offer). Kim and Novachuk will have the company for themselves (with its commodity and political risks) and shareholders have (fairly) grabbed a 33% increase (part of the future FCF from Baimskaya). Recommendation is Long KAZ TP 869 and tender. Gross spread is 0.57%, or c. 2.3% annualized.

On 4 February, Nova Resources caught up with KAZ Minerals' share price bull run and <a href="https://www.kazminerals.com/media/21872/increased-offer-announcement-4-feb-2020.pdf" target="_blank" rel="noopener">sweetened its offer to 780p</a>, just shy of my previous TP of 787p (see my insight <a href="https://www.smartkarma.com/insights/kaz-minerals" target="_blank" data-smartkarma-citation="insights:47013" rel="noopener">KAZ Minerals</a>), in an effort to woo minority shareholders.
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<li>The increased offer price represents a premium of c. 22% vs. the 640p per share offer (from 28 October) and values the equity of KAZ at £3,685 mn, 6.4x EV/21e EBITDA.</li>
</ul>
Nova and KAZ Minerals aim to complete the deal in H1 2021. If successful, the miner will be delisted in both London and Almaty.
Relevant points:
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<li>As per the release, the offer is not final, and therefore Nova could raise the offer again.</li>
<li>Over 50% gives chairman Oleg Novachuk and director Vladimir Kim (only shareholders of Nova) a stronger majority compared to which they now have, but to delist KAZ, they need 75% acceptances, whilst to squeeze out minority shareholders and fly solo they need over 90% acceptances.</li>
</ul>
Improving market sentiment, vaccines, industry return to normal and prospects for copper have outrun the initial offer, which in hindsight looks a bit opportunistic. However, this improved offer lays the ground for a "final offer".
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<li>The shares closed at 799p on 4 February vs the increased 780p offer.</li>
<li>Most shareholders will choose to keep their shares, and they will stand in the way of Nova's plan to delist unless there is another increase in the offer price, in my view.</li>
<li>The tussle is being very civilized so far, there has not been a huge rebellion, but minority shareholders are airing (and arguing) their views.</li>
<li>An improved offer could be made by raising the prospects for Baimskaya.</li>
<li>This offer could come at the lower end of what some investors estimate for Baimskaya, i.e. 846p per KAZ's share, an 8% increase vs. the improved offer and 32% above the original offer, which does not look unreasonable.</li>
</ul>
Recommendation is LONG KAZ LN.
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The shares closed at 799p, 3.3% higher vs. the previous close and 2.4% above the improved offer (with c. £57 mn traded).
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On 4 February, Nova Resources caught up with KAZ Minerals' share price bull run and sweetened its offer to 780p, just shy of my previous TP of 787p (see my insight KAZ Minerals), in an effort to woo minority shareholders.

The increased offer price represents a premium of c. 22% vs. the 640p per share offer (from 28 October) and values the equity of KAZ at £3,685 mn, 6.4x EV/21e EBITDA.

Nova and KAZ Minerals aim to complete the deal in H1 2021. If successful, the miner will be delisted in both London and Almaty.
Relevant points:

As per the release, the offer is not final, and therefore Nova could raise the offer again.
Over 50% gives chairman Oleg Novachuk and director Vladimir Kim (only shareholders of Nova) a stronger majority compared to which they now have, but to delist KAZ, they need 75% acceptances, whilst to squeeze out minority shareholders and fly solo they need over 90% acceptances.

Improving market sentiment, vaccines, industry return to normal and prospects for copper have outrun the initial offer, which in hindsight looks a bit opportunistic. However, this improved offer lays the ground for a "final offer".

The shares closed at 799p on 4 February vs the increased 780p offer.
Most shareholders will choose to keep their shares, and they will stand in the way of Nova's plan to delist unless there is another increase in the offer price, in my view.
The tussle is being very civilized so far, there has not been a huge rebellion, but minority shareholders are airing (and arguing) their views.
An improved offer could be made by raising the prospects for Baimskaya.
This offer could come at the lower end of what some investors estimate for Baimskaya, i.e. 846p per KAZ's share, an 8% increase vs. the improved offer and 32% above the original offer, which does not look unreasonable.

Recommendation is LONG KAZ LN.


The shares closed at 799p, 3.3% higher vs. the previous close and 2.4% above the improved offer (with c. £57 mn traded).


KAZ Minerals: Sweetened Offer but Maybe Not Convincing Enough

This is an interesting special situation given copper's decent outlook and investor pushback on this takeover offer.
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By making it a straight takeover, the main acceptance threshold changes to 75% of the company shareholders rather than 75% of its minority shareholders voting at an EGM.
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However, it still means the offeror will need 50% of KAZ Minerals’ minority shareholders to vote in favour of the offer, which may prove difficult given soaring gold and copper prices.
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RWC Partners, fifth largest shareholder with a 3.3% stake, said on 8 November that the offer from Nova Resources significantly undervalues KAZ Minerals and plans to vote against the buyout by Nova. CFC Management, a Russia-based investment advisor that represents Maxim Vorobyev and other minority shareholders that jointly hold approximately 3.6%, said on 12 November that its clients intend to vote against the buyout.
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</ul>
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At the time of the offer announcement, copper reserves &amp; resources were valued at 2.24 £/lb. vs. a current price of 2.66 £/lb, c. 19% higher.
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<li>
KAZ minerals has 82% exposure (copper) to EV metals.
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Macro backdrop is supportive and medium-term copper fundamentals are robust; but KAZ will be vulnerable if the copper price consolidates.
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</ul>
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On 29 October the offer itself looked fair and my recommendation was long KAZ as the deal, albeit cheeky, looked likely to succeed,
<ul>
<li>hence irrevocable undertakings for c. 10.63% of the existing issued share capital, which,</li>
<li>together with the shares owned by the Consortium represents approximately 50.02% of the share capital.</li>
<li>The latest bid timetable means shareholders will be able to see FY results when they are announced in February.</li>
</ul>
At the close of 21 January, the share price of KAZ is 19.5% higher than the offer, which makes it increasingly difficult that shareholders tender their shares.
<ul>
<li>
Median target price from 15 analysts on Capital IQ is 668p.</li>
<li>Recent upward revisions mean this TP is likely to increase.</li>
<li>KAZ Minerals trades at 2021e EV/EBITDA of 5.7x, a discount to the 7.0x of the median of peers (Antofagasta is trading at 7.8x).</li>
</ul>
Recommendation from a fundamental point of view is LONG KAZ TP 787p (50% 7x EV/Fwd EBITDA, 50% NPV), 23% upside to the indicated offer price and 4% upside to the last closing. From an arbitrage perspective, things are less clear, unless Nova sweetens its bid, I do not see the current offer succeeding.
This insight is labelled "bearish" because I think the bid by Nova was opportunistic, and the share price of KAZ is on a bull-run and well above the offer price. It seems increasingly unlikely that Nova sweetens its bid, in my view.

This is an interesting special situation given copper's decent outlook and investor pushback on this takeover offer.


By making it a straight takeover, the main acceptance threshold changes to 75% of the company shareholders rather than 75% of its minority shareholders voting at an EGM.


However, it still means the offeror will need 50% of KAZ Minerals’ minority shareholders to vote in favour of the offer, which may prove difficult given soaring gold and copper prices.



RWC Partners, fifth largest shareholder with a 3.3% stake, said on 8 November that the offer from Nova Resources significantly undervalues KAZ Minerals and plans to vote against the buyout by Nova. CFC Management, a Russia-based investment advisor that represents Maxim Vorobyev and other minority shareholders that jointly hold approximately 3.6%, said on 12 November that its clients intend to vote against the buyout.





At the time of the offer announcement, copper reserves &amp; resources were valued at 2.24 £/lb. vs. a current price of 2.66 £/lb, c. 19% higher.


KAZ minerals has 82% exposure (copper) to EV metals.


Macro backdrop is supportive and medium-term copper fundamentals are robust; but KAZ will be vulnerable if the copper price consolidates.




On 29 October the offer itself looked fair and my recommendation was long KAZ as the deal, albeit cheeky, looked likely to succeed,

hence irrevocable undertakings for c. 10.63% of the existing issued share capital, which,
together with the shares owned by the Consortium represents approximately 50.02% of the share capital.
The latest bid timetable means shareholders will be able to see FY results when they are announced in February.

At the close of 21 January, the share price of KAZ is 19.5% higher than the offer, which makes it increasingly difficult that shareholders tender their shares.


Median target price from 15 analysts on Capital IQ is 668p.
Recent upward revisions mean this TP is likely to increase.
KAZ Minerals trades at 2021e EV/EBITDA of 5.7x, a discount to the 7.0x of the median of peers (Antofagasta is trading at 7.8x).

Recommendation from a fundamental point of view is LONG KAZ TP 787p (50% 7x EV/Fwd EBITDA, 50% NPV), 23% upside to the indicated offer price and 4% upside to the last closing. From an arbitrage perspective, things are less clear, unless Nova sweetens its bid, I do not see the current offer succeeding.
This insight is labelled "bearish" because I think the bid by Nova was opportunistic, and the share price of KAZ is on a bull-run and well above the offer price. It seems increasingly unlikely that Nova sweetens its bid, in my view.

United Kingdom

KAZ Minerals PLC is a copper company. The Company mines, processes, and supplies copper. KAZ Minerals conducts its business operations in the United Kingdom, Kazakhstan, and Hong Kong.

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KAZ Minerals (KAZ LN)

Xavier Niel/Iliad: An Offer Shareholders Can't Refuse?

Although the offer will likely receive majority of acceptances, my TP is €190.7, a 4.7% upside to the offer. Market awaits a sweetened bid....

Jesus Rodriguez Aguilar

Trading Above Terms at the Start of the Tender Offer Period

The market awaits a sweetened offer, highly likely in my view. New TP (DCF based) is €11.04/share. An increase would be justified by better...

Jesus Rodriguez Aguilar

Kaz Minerals: Time to Cash In

Kim and Novachuk will have the company for themselves and shareholders have (fairly) grabbed a 33% increase. Folks will tender. Long KAZ, TP 869....

Jesus Rodriguez Aguilar

KAZ Minerals: Sweetened Offer but Maybe Not Convincing Enough

Improving market sentiment, vaccines, industry return to normal and copper prospects have outrun both the initial and the improved offer. A final...

Jesus Rodriguez Aguilar

KAZ Minerals

Long KAZ TP 787p (50% 7x EV/Fwd EBITDA, 50% NPV), 23% upside to the offer price. From an arbitrage perspective, things are less clear, unless Nova...

Jesus Rodriguez Aguilar

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