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.

HAL Holding/​Royal Boskalis Westminster: Offer Launch & Precedent of Orange/Orange Belgium

HAL Holding/​​Royal Boskalis Westminster: Sweetened Offer

Contested Orange Plans to Takeout Orange Belgium

Orange Belgium - Orange: Final Offer and Holdouts

TalkTalk - Toscafund: Preliminary & Non-Binding Proposal

Event-Driven

On 27 April, <a href="https://www.smartkarma.com/entities/orange-sa" target="_blank" data-smartkarma-citation="entities:21522:1" rel="noopener">Orange SA (ORA FP)</a> published the results of its offer for <a href="https://www.smartkarma.com/entities/orange-belgium-sa" target="_blank" data-smartkarma-citation="entities:21340:1" rel="noopener">Orange Belgium SA (MOBB EU)</a>. It now holds a 74.68% stake.
Orange has decided to re-open the tender for five trading days (28 April to 4 May inclusive, offer price unchanged) with the aim of gaining more acceptances.
Orange Belgium closed at €22.25 on 27 April, a 1.8% higher vs. the prior trading session and 1.1% above Orange's re-opened offer. The shares are inexpensive, trading at 5.2x EV/Fwd EBITDA (vs. 5.96x for peers), and offer a 9.3% 21e EFCF yield.
Its seems difficult that Orange will gain any more offer acceptances and as per Polygon's statement, it is far from being able to squeeze-out and delist. In the absence of any negotiations about bumping the offer price, TP lowered to €26.6, in line with peers' median EV/Fwd EBITDA. Reiterate long.
Risks: lower liquidity for the shares (I estimate c. €1 mn daily), lower revenues from higher competition and/or rising wholesale cable costs, higher capex investments than expected (Orange has not made clear whether they will be with a FTTH partner or will seek to acquire a cable company), entrance of a fourth mobile operator.

On 27 April, Orange SA (ORA FP) published the results of its offer for Orange Belgium SA (MOBB EU). It now holds a 74.68% stake.
Orange has decided to re-open the tender for five trading days (28 April to 4 May inclusive, offer price unchanged) with the aim of gaining more acceptances.
Orange Belgium closed at €22.25 on 27 April, a 1.8% higher vs. the prior trading session and 1.1% above Orange's re-opened offer. The shares are inexpensive, trading at 5.2x EV/Fwd EBITDA (vs. 5.96x for peers), and offer a 9.3% 21e EFCF yield.
Its seems difficult that Orange will gain any more offer acceptances and as per Polygon's statement, it is far from being able to squeeze-out and delist. In the absence of any negotiations about bumping the offer price, TP lowered to €26.6, in line with peers' median EV/Fwd EBITDA. Reiterate long.
Risks: lower liquidity for the shares (I estimate c. €1 mn daily), lower revenues from higher competition and/or rising wholesale cable costs, higher capex investments than expected (Orange has not made clear whether they will be with a FTTH partner or will seek to acquire a cable company), entrance of a fourth mobile operator.

Orange Belgium

Orange/Orange Belgium: Offer Re-Opening