European Event-Driven Analyst

Jesus Rodriguez Aguilar

Jesús is an Insight Provider (Event-driven) on the Smartkarma network, where he looks across sectors at opportunities arising from securities mispricing (both credit and equity), share classes, bid announcements, prospective bids, and special situations. He has served as Economic and Business Advisor at the Spanish Congress in Madrid. Prior to that, he has worked in the City of London: as a Credit Analyst at Bloomberg; Event-driven associate at former boutique European Research; and doubled as Special Situations and Equity-linked VP (convertible bonds) at Merrill Lynch. Jesús has an MBA from the London Business School, a BA (Hons.) degree in Economics from the Complutense University in Madrid, and a BA (Hons.) in Law from U.N.E.D., also in Madrid.

Entra - SBB - Castellum: Bidding War Heats Up

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Event-Driven

<a href="https://www.smartkarma.com/entities/fastighets-ab-balder" target="_blank" data-smartkarma-citation="entities:22289:1" rel="noopener">Fastighets Ab Balder (BALDB SS)</a> intends to make an offer to acquire the remaining 66.33% stake in <a href="https://www.smartkarma.com/entities/entra-asa" target="_blank" data-smartkarma-citation="entities:22229:1" rel="noopener">Entra ASA (ENTRA NO)</a> for NOK 24.5 bn after it crossed the 33.3% mandatory offer threshold on 12 October. Under the Offer, Balder intends to acquire the remaining 120,811,936 shares of Entra at NOK 202.5/share. Balder prefer Entra to continue to be listed on the Oslo Stock Exchange. The consideration represents 29x EV/EBITDA, 27.0x deal value/est. FFO, deal value/consensus NAV of 119.4% and c. 2.3% premium to EPRA NRV.
Swedish real estate firms <a href="https://www.smartkarma.com/entities/samhallsbyggnadsbolaget-i-norden-ab" target="_blank" data-smartkarma-citation="entities:31109:1" rel="noopener">Samhällsbyggnadsbolaget I Norden AB (SBBB SS)</a> and <a href="https://www.smartkarma.com/entities/castellum-ab" target="_blank" data-smartkarma-citation="entities:22321:1" rel="noopener">Castellum AB (CAST SS)</a> had previously tried to acquire Entra, but both withdrew their bids last February after their offers failed to win enough backing (see <a href="https://www.smartkarma.com/insights/entra-asa-competing-offers" target="_blank" data-smartkarma-citation="insights:45673" rel="noopener">Entra ASA: Competing Offers</a> and <a href="https://www.smartkarma.com/insights/entra-sbb-castellum-bidding-war-heats-up" target="_blank" data-smartkarma-citation="insights:46523" rel="noopener">Entra - SBB - Castellum: Bidding War Heats Up</a>).
Castellum acquired a 11.8% stake in Entra from the Norwegian government pension fund in August. The acquisition price was NOK 210/share and Castellum now holds a 30.6% stake. At that time, Balder still held a 30% stake.
The contest for Entra seems far from over. On 13 October, the shares closed at NOK 214.8, 6% above the intended mandatory offer price, and 2.3% above the price paid by Castellum when it acquired a 11.8% stake in August. Castellum may keep on acquiring shares before triggering the mandatory offer threshold.
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An improved bid could come from Castellum, up to a level of NOK 228/share, 15% premium to Entra’s Q2 2021 EPRA NRV, but would surely involve cash and shares.
Regarding takeover offers in Norway, the mandatory offer obligation is again triggered by acquisitions of shares representing more than 40% and 50% of the voting rights (repeat offer obligation).
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Fastighets Ab Balder (BALDB SS) intends to make an offer to acquire the remaining 66.33% stake in Entra ASA (ENTRA NO) for NOK 24.5 bn after it crossed the 33.3% mandatory offer threshold on 12 October. Under the Offer, Balder intends to acquire the remaining 120,811,936 shares of Entra at NOK 202.5/share. Balder prefer Entra to continue to be listed on the Oslo Stock Exchange. The consideration represents 29x EV/EBITDA, 27.0x deal value/est. FFO, deal value/consensus NAV of 119.4% and c. 2.3% premium to EPRA NRV.
Swedish real estate firms Samhällsbyggnadsbolaget I Norden AB (SBBB SS) and Castellum AB (CAST SS) had previously tried to acquire Entra, but both withdrew their bids last February after their offers failed to win enough backing (see Entra ASA: Competing Offers and Entra - SBB - Castellum: Bidding War Heats Up).
Castellum acquired a 11.8% stake in Entra from the Norwegian government pension fund in August. The acquisition price was NOK 210/share and Castellum now holds a 30.6% stake. At that time, Balder still held a 30% stake.
The contest for Entra seems far from over. On 13 October, the shares closed at NOK 214.8, 6% above the intended mandatory offer price, and 2.3% above the price paid by Castellum when it acquired a 11.8% stake in August. Castellum may keep on acquiring shares before triggering the mandatory offer threshold.

An improved bid could come from Castellum, up to a level of NOK 228/share, 15% premium to Entra’s Q2 2021 EPRA NRV, but would surely involve cash and shares.
Regarding takeover offers in Norway, the mandatory offer obligation is again triggered by acquisitions of shares representing more than 40% and 50% of the voting rights (repeat offer obligation).


Samhällsbyggnadsbolaget I Norden AB (SBBB SS)

Balder/Entra ASA: Game of Thrones in Scandinavian Real Estate