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.

Cerved Group - Castor Srl: Sweet Opportunity in Loans Gone Sour

Trading Above Terms at the Start of the Tender Offer Period

Event-Driven

Since the offer was first announced in March, I had been long <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>  (target prices of €10.00/share, raised to €11.04/share). At the time of publishing my last Insight (see <a href="https://www.smartkarma.com/insights/castor-raises-bid-for-cerved" target="_blank" data-smartkarma-citation="insights:56921" rel="noopener">Castor Raises Bid for Cerved</a>), gross spread to the increased consideration (€10.20/share) was 2.3%. In a last push, Castor (ION's bidco) offered a success premium of €0.30/share, taking the total consideration to €10.50/share, in case it reached over 90% acceptances.
Castor announced that at the end of the tender period, 78.9% of the shares were tendered, which together with a 1.1% stake acquired in the market by Castor over different purchases, represent in total 80% of the share capital of Cerved, thus fulfilling the minimum threshold condition. The offer is effective and the final price is €10.20/share.
Since Castor did not reach the 90% threshold in its takeover bid, there's no obligation to buy the shares of minority shareholders (voluntary sell-out procedure). Still, a delisting could still happen through a merger between Cerved and one of ION’s subsidiaries.
ION has said owning more than two-thirds of Cerved would allow it to call an EGM at which it could seek approval for a merger between Cerved and one of its units. A candidate could be Cedacri, an Italian banking software provider acquired by ION in March 2021.
The shares are still liquid, between €6 mn and €9 mn over the last two sessions and trading at €10.21 (VWAP), a wee bit above the offer price. Time to offload.

Since the offer was first announced in March, I had been long Cerved Group S.p.A. (CERV IM)  (target prices of €10.00/share, raised to €11.04/share). At the time of publishing my last Insight (see Castor Raises Bid for Cerved), gross spread to the increased consideration (€10.20/share) was 2.3%. In a last push, Castor (ION's bidco) offered a success premium of €0.30/share, taking the total consideration to €10.50/share, in case it reached over 90% acceptances.
Castor announced that at the end of the tender period, 78.9% of the shares were tendered, which together with a 1.1% stake acquired in the market by Castor over different purchases, represent in total 80% of the share capital of Cerved, thus fulfilling the minimum threshold condition. The offer is effective and the final price is €10.20/share.
Since Castor did not reach the 90% threshold in its takeover bid, there's no obligation to buy the shares of minority shareholders (voluntary sell-out procedure). Still, a delisting could still happen through a merger between Cerved and one of ION’s subsidiaries.
ION has said owning more than two-thirds of Cerved would allow it to call an EGM at which it could seek approval for a merger between Cerved and one of its units. A candidate could be Cedacri, an Italian banking software provider acquired by ION in March 2021.
The shares are still liquid, between €6 mn and €9 mn over the last two sessions and trading at €10.21 (VWAP), a wee bit above the offer price. Time to offload.

Cerved Group S.p.A.

ION/Cerved: Offer Results, What Next?