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.

Ergomed - Solid FY22 marked by broad-based growth

Event-Driven

<ul>
<li>The 1,350p offer for <a href="https://www.smartkarma.com/entities/ergomed-plc" target="_blank" data-smartkarma-citation="entities:23411:1" rel="noopener">Ergomed Plc (ERGO LN)</a> (28% premium, 18.9x EV/Fwd NTM EBITDA using IBES estimated) seems optically attractive considering share underperformance, and in line with closest peer Medpace at 19.06x.</li>
<li>Nevertheless there'd be synergies available to a trade buyer and other than 18% from the Founder, there aren't any other irrevocables, which indicates the offer price is far from knock-out.</li>
<li>I set my TP at 1,350p. Spread turned negative last week, now 0.59%/1.71% (gross/annualised, assuming settlement by mid-February). I would be long considering there's still time for a competing offer.</li>
</ul>


The 1,350p offer for Ergomed Plc (ERGO LN) (28% premium, 18.9x EV/Fwd NTM EBITDA using IBES estimated) seems optically attractive considering share underperformance, and in line with closest peer Medpace at 19.06x.
Nevertheless there'd be synergies available to a trade buyer and other than 18% from the Founder, there aren't any other irrevocables, which indicates the offer price is far from knock-out.
I set my TP at 1,350p. Spread turned negative last week, now 0.59%/1.71% (gross/annualised, assuming settlement by mid-February). I would be long considering there's still time for a competing offer.


Ergomed Plc

No Danger in Being Long