European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/unipol-gruppo-s-p-a" target="_blank" data-smartkarma-citation="entities:21235:1" rel="noopener">Unipol Gruppo S.p.A (UNI IM)</a> has reached 95% of the share capital of <a href="https://www.smartkarma.com/entities/unipolsai-spa" target="_blank" data-smartkarma-citation="entities:21236:1" rel="noopener">UnipolSai SpA (US IM)</a>, therefore the conditions for the squeeze-out are met.</li>
<li>The dividend-adjusted offer price is €2.535. Unipol has three months from 26 April to implement the squeeze-out. The holding discount, as expected, has closed.</li>
<li>Spread to cash offer is 0.51%/3.85% (gross, annualized assuming settlement of squeeze-out by 26 July). The share alternative is now trading at a premium.</li>
</ul>



Unipol Gruppo S.p.A (UNI IM) has reached 95% of the share capital of UnipolSai SpA (US IM), therefore the conditions for the squeeze-out are met.
The dividend-adjusted offer price is €2.535. Unipol has three months from 26 April to implement the squeeze-out. The holding discount, as expected, has closed.
Spread to cash offer is 0.51%/3.85% (gross, annualized assuming settlement of squeeze-out by 26 July). The share alternative is now trading at a premium.


Unipol Gruppo/UnipolSai: Squeeze-Out and Spread

<ul>
<li>
<a href="https://www.smartkarma.com/entities/unipol-gruppo-s-p-a" target="_blank" data-smartkarma-citation="entities:21235:1" rel="noopener">Unipol Gruppo S.p.A (UNI IM)</a> offers €2.7/share to buy out <a href="https://www.smartkarma.com/entities/unipolsai-spa" target="_blank" data-smartkarma-citation="entities:21236:1" rel="noopener">UnipolSai SpA (US IM)</a>, for an implied €7.64 billion equity value, 12.6% premium, in an awaited move to simplify the group's structure.</li>
<li>If taken in full, would be worth €1,126.9 million. The share alternative is 3 UNI MI x 10 US IM, and does not account for the huge discount/NAV of Unipol.</li>
<li>Gross spread is: 1.63%/21.5% (cash/share alternative respectively). Annualised return of cash offer is 7.51%. I would expect the share alternative to progressively close the discount.</li>
</ul>



Unipol Gruppo S.p.A (UNI IM) offers €2.7/share to buy out UnipolSai SpA (US IM), for an implied €7.64 billion equity value, 12.6% premium, in an awaited move to simplify the group's structure.
If taken in full, would be worth €1,126.9 million. The share alternative is 3 UNI MI x 10 US IM, and does not account for the huge discount/NAV of Unipol.
Gross spread is: 1.63%/21.5% (cash/share alternative respectively). Annualised return of cash offer is 7.51%. I would expect the share alternative to progressively close the discount.


Unipol Gruppo/UnipolSai: Take the Stock Instead

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>A new tool highlights which TSE companies have disclosed a policy/consideration; sometimes referred to as the "name and shame" list. In practice, more "name" than "shame". </li>
<li>
<a href="https://www.smartkarma.com/entities/jardine-cycle-carriage-ltd" target="_blank" data-smartkarma-citation="entities:347:1" rel="noopener">Jardine Cycle &amp; Carriage (JCNC SP)</a> is trading rich to its NAV. And the simple ratio (JCNC/<a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>) is the highest level outside the 2008 GFC. </li>
<li>This is a rubbish Offer for <a href="https://www.smartkarma.com/entities/asia-cement-china-holdings" target="_blank" data-smartkarma-citation="entities:3374:1" rel="noopener">Asia Cement China (743 HK)</a>. Given how shareholders voted at last year's AGM, expect this Scheme to be voted down. Avoid.</li>
</ul>


A new tool highlights which TSE companies have disclosed a policy/consideration; sometimes referred to as the "name and shame" list. In practice, more "name" than "shame". 

Jardine Cycle &amp; Carriage (JCNC SP) is trading rich to its NAV. And the simple ratio (JCNC/Astra International (ASII IJ)) is the highest level outside the 2008 GFC. 
This is a rubbish Offer for Asia Cement China (743 HK). Given how shareholders voted at last year's AGM, expect this Scheme to be voted down. Avoid.


Last Week in Event SPACE: Jardine Cycle & Carriage, "Name & Shame", Asia Cement, Northern Minerals

<ul>
<li>There is no suggestion of precondition breach attached to <a href="https://www.smartkarma.com/entities/outsourcing-inc" target="_blank" data-smartkarma-citation="entities:7431:1" rel="noopener">Outsourcing Inc (2427 JP)</a>'s impairment losses. </li>
<li>Seven Group, now holding 71.6%, has returned to the well, and made a cash/scrip Offer for shares not owned in <a href="https://www.smartkarma.com/entities/boral-ltd" target="_blank" data-smartkarma-citation="entities:1487:1" rel="noopener">Boral (BLD AU)</a>, with certain tendering thresholds triggering more cash.</li>
<li>
<a href="https://www.smartkarma.com/entities/itoki-corp" target="_blank" data-smartkarma-citation="entities:18032:1" rel="noopener">Itoki Corp (7972 JP)</a>'s mega ToSTNeT-3 buyback is now done.</li>
</ul>


There is no suggestion of precondition breach attached to Outsourcing Inc (2427 JP)'s impairment losses. 
Seven Group, now holding 71.6%, has returned to the well, and made a cash/scrip Offer for shares not owned in Boral (BLD AU), with certain tendering thresholds triggering more cash.

Itoki Corp (7972 JP)'s mega ToSTNeT-3 buyback is now done.


Last Week in Event SPACE: Outsourcing, Boral, Itoki, CIMC Vehicle, Dissentient Shareholder Rights

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

<ul>
<li>CASA’s enhanced offer for <a href="https://www.smartkarma.com/entities/credito-valtellinese-spa" target="_blank" data-smartkarma-citation="entities:21175:1" rel="noopener">Credito Valtellinese SpA (CVAL IM)</a> confirms the appetite for M&amp;A in Southern Europe, and Italy in particular</li>
<li>We expect Italian M&amp;A to be largely intra-country, as the key factors driving consolidation is the need for greater domestic scale given the lower for longer interest rates, especially in Europe, as well as the march of digital banking globally</li>
<li>After <a href="https://www.smartkarma.com/entities/intesa-sanpaolo-spa" target="_blank" data-smartkarma-citation="entities:21200:1" rel="noopener">Intesa Sanpaolo (ISP IM)</a>-UBI, and now potentially the conclusion of CASA Italia-CreVal, the focus is on the future of <a href="https://www.smartkarma.com/entities/banca-monte-dei-paschi-di-siena" target="_blank" data-smartkarma-citation="entities:21162:1" rel="noopener">Banca Monte dei Paschi di Siena (BMPS IM)</a> </li>
<li>A combination between <a href="https://www.smartkarma.com/entities/banco-bpm-spa" target="_blank" data-smartkarma-citation="entities:28121:1" rel="noopener">Banco BPM SpA (BAMI IM)</a> and <a href="https://www.smartkarma.com/entities/bper-banca-s-p-a" target="_blank" data-smartkarma-citation="entities:21165:1" rel="noopener">BPER Banca S.p.A (BPE IM)</a> now seems less likely; this implies that Banco BPM is a potential contender, once again, to combine with BMPS; the latter has largely de-risked its balance sheet, even if its core capital ratio is low</li>
<li>We would see a BPM-BMPS union as a major positive catalyst for a <a href="https://www.smartkarma.com/entities/unicredit-spa" target="_blank" data-smartkarma-citation="entities:21234:1" rel="noopener">UniCredit SpA (UCG IM)</a>  re-rating; even if Unicredit were to acquire BMPS, we believe that, at current valuations, a lot of the risks are discounted</li>
<li>Risks to our positive Unicredit view include Unicredit’s acquisition of BMPS on unfavourable terms, as well as worse than expected organic performance of revenue growth, given the challenging interest rate environment</li>
</ul>


CASA’s enhanced offer for Credito Valtellinese SpA (CVAL IM) confirms the appetite for M&amp;A in Southern Europe, and Italy in particular
We expect Italian M&amp;A to be largely intra-country, as the key factors driving consolidation is the need for greater domestic scale given the lower for longer interest rates, especially in Europe, as well as the march of digital banking globally
After Intesa Sanpaolo (ISP IM)-UBI, and now potentially the conclusion of CASA Italia-CreVal, the focus is on the future of Banca Monte dei Paschi di Siena (BMPS IM) 
A combination between Banco BPM SpA (BAMI IM) and BPER Banca S.p.A (BPE IM) now seems less likely; this implies that Banco BPM is a potential contender, once again, to combine with BMPS; the latter has largely de-risked its balance sheet, even if its core capital ratio is low
We would see a BPM-BMPS union as a major positive catalyst for a UniCredit SpA (UCG IM)  re-rating; even if Unicredit were to acquire BMPS, we believe that, at current valuations, a lot of the risks are discounted
Risks to our positive Unicredit view include Unicredit’s acquisition of BMPS on unfavourable terms, as well as worse than expected organic performance of revenue growth, given the challenging interest rate environment


Southern Europe Banks: Focus on Italian Banks M&A

Italy

Unipol Gruppo S.p.A sells life and property/casualty insurance and reinsurance in Italy.  The Company's non-life insurance coverage includes accident, health, automobile, railroad rolling stock, aircraft, marine, and fire.

Banca Mediolanum S.p.A. provides banking services. The Bank, through its component companies, provides banking, financial, insurance, retirement, and real estate products and services. Banca Mediolanum operates in Italy.

Banca Monte dei Paschi di Siena S.p.A. provides retail and commercial banking services. The Bank offers leasing and factoring, corporate finance, asset management, insurance, mutual funds, and investment banking services.

BPER Banca S.p.A is a cooperative bank that operates branches throughout Italy.  The Bank attracts deposits and offers loans, credit cards, pension plans, investment funds, insurance, and asset management and online trading services.

Banco BPM S.p.A. operates as a bank. The Bank offers private and corporate banking, loans, e-banking, investment, and other related services. Banco BPM serves customers in Italy.

Banca Generali S.p.A. is an Italian asset gathering company targeting affluent and private clients through a network of financial advisors, private bankers and relationship managers. Banca Generali provides a full range of banking services, asset management and insurance products, combining in-house expertise with a multi-brand offer for asset management products.

FinecoBank Banca Fineco SpA provides a full range of commercial banking services. The Bank offers a product range including savings, investments, mortgage loans, financing, insurance and online banking.

Azimut Holding SpA offers investment management services.  The Company manages open-end mutual and pension funds, and offers investment advice and insurance. Azimut distributes its products through financial consultants in northern and central Italy.

Banca Popolare di Sondrio Scrl attracts deposits and offers co-operative banking services.  The Bank offers mortgage and other consumer loans, business loans, closed-end funds, treasury and securities brokerage services, asset management, and portfolio management.  Banca Popolare operates in Italy, Switzerland and Hong Kong.

Credito Emiliano S.p.A. attracts deposits and offers commercial, retail, and investment banking and financial services.  The bank offers short and medium to long term loans and finance leasing and factoring, fund management, and security trading and placement services.  Credito Emiliano also provides corporate finance and private banking services and insurance products.

Medibank Private Limited offers private health care coverage for hospital and ancillary services. The Company offers a range of health insurance products such as health, travel, pet, and life coverage to overseas students and visitors. Medibank serves customers throughout Australia.

Samsung Fire & Marine Insurance Co., Ltd. provides insurance services. The Company offers auto, fire, marine, casualty, health, leisure, and retirement products and services. Samsung Fire & Marine Insurance serves customers in South Korea.

Samsung Fire & Marine Insurance (000810 KS)

Japan Post Insurance Co. Ltd. operates life insurance business. The Company offers whole life insurance, education endowment, ordinary endowment, medical insurance, and special endowment insurance. Japan Post Insurance provides services for individuals and businesses throughout Japan.

Globe Life Inc. operates as an insurance company. The Company offers term, whole, and children's life insurance, as well as accidental benefits, mortgage protection, and medicare supplement plans. Globe Life operates in the State of Texas.

Assurant, Inc. provides specialized insurance and insurance-related products. The Company offers individual and small employer group health insurance, group dental insurance, pre-funded funeral insurance, group disability and life insurance, creditor-placed homeowners insurance, manufactured housing homeowners insurance, debt protection administration, credit insurance, and warranties.

Primerica Inc. distributes financial products to middle income households in North America. The Company products include term life insurance, mutual funds, variable annuities and other financial products, which are distribute primarily on behalf of third parties.

Old Republic International Corporation is an insurance holding company whose subsidiaries market, underwrite, and provide risk management services.  The Company provides services for a variety of coverages in the property and liability, mortgage guaranty, title, and life and health insurance fields.

RLI Corp., through its subsidiaries, underwrites selected property, casualty, and surety insurance products.  The Company's principal subsidiary, RLI Insurance Group, provides specialty property and casualty coverages for primarily commercial risks.

Mapfre SA offers insurance services.  Through subsidiaries, the Company offers health, life, homeowner's, commercial, industrial risk, burial,  accident, automobile, and third-party liability insurance policies.  Mapfre operates in Europe and the Americas.

Ageas offers international insurance services such as life and non-life, disability, and medical to individuals and groups.

UnipolSai SpA is an multi-line insurance company.  The Company, through its subsidiaries, offers life, health, accident, automobile, marine, fire, general liability, and credit insurance.

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UnipolSai SpA (US IM)

Unipol Gruppo/UnipolSai: Squeeze-Out and Spread

Unipol Gruppo S.p.A (UNI IM) has reached 95% of the share capital of UnipolSai SpA (US IM), therefore the conditions for the squeeze-out are met.

Jesus Rodriguez Aguilar

Unipol Gruppo/UnipolSai: Take the Stock Instead

Unipol Gruppo offers €2.7/share to buy out UnipolSai, simplifying group structure with 12.6% premium. There is potential for the share alternative...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Jardine Cycle & Carriage, "Name & Shame", Asia Cement, Northern Minerals

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

Last Week in Event SPACE: Outsourcing, Boral, Itoki, CIMC Vehicle, Dissentient Shareholder Rights

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

Southern Europe Banks: Focus on Italian Banks M&A

The prospect of Italian bank sector M&A in Italy is overly penalizing Unicredit shares for the risk of a BMPS deal. With the BPM-BPER union called...

Victor Galliano

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52-week Range

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Unipol Gruppo/UnipolSai: Squeeze-Out and Spread

Unipol Gruppo S.p.A (UNI IM) has reached 95% of the share capital of UnipolSai SpA (US IM), therefore the conditions for the squeeze-out are met.

Jesus Rodriguez Aguilar

Unipol Gruppo/UnipolSai: Take the Stock Instead

​Unipol Gruppo offers €2.7/share to buy out UnipolSai, simplifying group structure with 12.6% premium. There is potential for the share alternative...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Jardine Cycle & Carriage, "Name & Shame", Asia Cement, Northern Minerals

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

Last Week in Event SPACE: Outsourcing, Boral, Itoki, CIMC Vehicle, Dissentient Shareholder Rights

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

Southern Europe Banks: Focus on Italian Banks M&A

The prospect of Italian bank sector M&A in Italy is overly penalizing Unicredit shares for the risk of a BMPS deal. With the BPM-BPER union called...

Victor Galliano

Unipol Gruppo offers €2.7/share to buy out UnipolSai, simplifying group structure with 12.6% premium. There is potential for the share alternative...