In this briefing:
1. Versum Materials – Merck KGaA Not Going Away (Part II)
Since my initial report on Versum Materials (VSM US) last week, Versum Materials – Entegris Beaten to the Punch by Merck KGaA , I’ve dug deeper and feel even more confident that Merck KGaA (MRK GR) is intent on seeing its proposal to acquire Versum to a successful conclusion, with or without a recommendation from the Versum board.
In this follow-up note I provide an update of events since last week, look at VSM’s corporate governance documents, review relevant landmark Delaware takeover case law, and elaborate on a possible path to control of Versum for Merck KGaA.
2. MINT’s First Post-Acquisition Update
We caught up with MINT and Bangkok Dec-Con today. Some highlights from the meeting:
- MINT has gained international presence following the acquisition of NH Hotels in Spain, but the first benefits is mainly coming from the top line side (34% revenue growth) rather than profit level at this stage. Having said that, NH itself has turned around significantly.
- Synergies expected through branding, loyalty programs, and cross-selling, though perhaps not all at once.
- Leverage reduction. Much has already been achieved by asset revaluation, but the next step involves sales of some selected Tivoli assets and issuance of new warrants entailing a maximum dilution of 20%.
- Bangkok Dec-Con acquired a 40% stake in Phuket water concessionaire Gold Shores in December for Bt600m. A sizable diversification, eventhough they are really growing their profits like crazy in 2018.
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