Daily Brief Industrials: Helios Techno Holding, CoreCivic , Norcros PLC, Skywest Inc and more

• Today at noon JST, Rs Technologies (3445 JP) released an announcement on TDNet, “Our policy regarding the tender offer for Helios Techno Holding Co., Ltd. shares”
• In it, they indicated that the price offered – ¥825/share – is a price which “fully returns to general shareholders the increased enterprise value that will result from [transaction] synergies.”
• They acknowledge the market price is trading higher than the TOB Price, but say they have no plans to raise the Tender Offer Price. So now what? It depends.

• The contract termination was driven primarily by costs, according to the WSJ.
• Unlike most CXW ICE contracts, the center has been operated under a costlier model because it was initially opened in 2014 to house families, then was transitioned in 2021 to detention primarily of individual adults.
• Despite the expected short-term challenge of the contract termination, longer term we expect rising demand from ICE under the traditional detention model.

Norcros’s FY24 results highlight its resilience in the face of tough markets, but we continue to believe that the outlook is improving in both of its core markets, the UK and South Africa. Despite the improving outlook we have maintained our revenue and profit forecasts and 251p/share valuation post the results, with the company trading on an undemanding P/E rating of 6.6x. However, it is worth highlighting the scale of the opportunity on offer to Norcros, which was illustrated at the recent capital markets day.

• Regional airlines like SkyWest were established to operate connecting routes under contracts with major airlines
• SkyWest’s efficient operations and strong relationships with major carriers have made it a dominant player in the regional airline market
• The company’s financial success and potential for future growth indicate a positive outlook for the coming years

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.