European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/iberdrola-sa" target="_blank" data-smartkarma-citation="entities:21276:1" rel="noopener">Iberdrola SA (IBE SM)</a> launches a $34.25/share cash offer to acquire the minorities (18.4%) in its US subsidiary <a href="https://www.smartkarma.com/entities/avangrid-inc" target="_blank" data-smartkarma-citation="entities:26503:1" rel="noopener">Avangrid (AGR US)</a>. Premium is 6.8%, and the cost c. $2.5 billion.</li>
<li>The market was awaiting this move since the cancellation of the PNM deal, which explains the recent rise in the share price of Avangrid.</li>
<li>Gross spread is 4.5%. It seems investors are buying in the hope of an offer sweetening, knowing that Iberdrola has some cash available to spend from the profitable Mexico exit.</li>
</ul>



Iberdrola SA (IBE SM) launches a $34.25/share cash offer to acquire the minorities (18.4%) in its US subsidiary Avangrid (AGR US). Premium is 6.8%, and the cost c. $2.5 billion.
The market was awaiting this move since the cancellation of the PNM deal, which explains the recent rise in the share price of Avangrid.
Gross spread is 4.5%. It seems investors are buying in the hope of an offer sweetening, knowing that Iberdrola has some cash available to spend from the profitable Mexico exit.


Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Keisei Electric Railway Co / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> places out 1% of <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a>, but rejects lowering its stake to 15%.  That is the end of the near-term catalyst.</li>
<li>
<a href="https://www.smartkarma.com/entities/new-world-development" target="_blank" data-smartkarma-citation="entities:7037:1" rel="noopener">New World Development (17 HK)</a> popped after property cooling measures were scrapped. Then gave those gains back. And then some, and is now trading at 0.11x P/B, its lowest-ever level.</li>
<li>The spreads for  both <a href="https://www.smartkarma.com/entities/alumina-ltd" target="_blank" data-smartkarma-citation="entities:939:1" rel="noopener">Alumina Ltd (AWC AU) </a> and <a href="https://www.smartkarma.com/entities/azure-minerals-ltd" target="_blank" data-smartkarma-citation="entities:16538:1" rel="noopener">Azure Minerals (AZS AU)</a> are trading wide; both potentially FIRB-related.</li>
</ul>



Keisei Electric Railway Co (9009 JP) places out 1% of Oriental Land (4661 JP), but rejects lowering its stake to 15%.  That is the end of the near-term catalyst.

New World Development (17 HK) popped after property cooling measures were scrapped. Then gave those gains back. And then some, and is now trading at 0.11x P/B, its lowest-ever level.
The spreads for  both Alumina Ltd (AWC AU)  and Azure Minerals (AZS AU) are trading wide; both potentially FIRB-related.


Last Week in Event SPACE: Keisei Electric, New World Development, Alumina Ltd, Azure Minerals, TDCX

<ul>
<li>Stay long in <a href="https://www.smartkarma.com/entities/hs-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:7311:1" rel="noopener">HS Holdings (8699 JP)</a>.But beware. It is possible that there is a slightly uncomfortable outcome. </li>
<li>
<a href="https://www.smartkarma.com/entities/celltrion-pharm-inc" target="_blank" data-smartkarma-citation="entities:992:1" rel="noopener">Celltrion Pharm (068760 KS)</a> is up 37% since the <a href="https://www.smartkarma.com/entities/celltrion-inc" target="_blank" data-smartkarma-citation="entities:991:1" rel="noopener">Celltrion Inc (068270 KS)</a>/<a href="https://www.smartkarma.com/entities/celltrion-healthcare-co-ltd" target="_blank" data-smartkarma-citation="entities:23641:1" rel="noopener">Celltrion Healthcare (091990 KS)</a> merger completed; and Inc is up 22%. That's A LOT of expectation baked in. </li>
<li>NEW NISA details are cute, but governance and corporate buybacks matter more. If better education induces a swing from cash/deposits to risky assets, much of that will happen outside NISA.</li>
</ul>


Stay long in HS Holdings (8699 JP).But beware. It is possible that there is a slightly uncomfortable outcome. 

Celltrion Pharm (068760 KS) is up 37% since the Celltrion Inc (068270 KS)/Celltrion Healthcare (091990 KS) merger completed; and Inc is up 22%. That's A LOT of expectation baked in. 
NEW NISA details are cute, but governance and corporate buybacks matter more. If better education induces a swing from cash/deposits to risky assets, much of that will happen outside NISA.


Last Week in Event SPACE: HS Holdings, Celltrion Pharm, NISA, PICC/PICC P&C

<ul>
<li>
<a href="https://www.smartkarma.com/entities/iberdrola-sa" target="_blank" data-smartkarma-citation="entities:21276:1" rel="noopener">Iberdrola SA (IBE SM)</a>'s U.S. subsidiary <a href="https://www.smartkarma.com/entities/avangrid-inc" target="_blank" data-smartkarma-citation="entities:26503:1" rel="noopener">Avangrid (AGR US)</a> terminated its $8.3 billion deal for <a href="https://www.smartkarma.com/entities/pnm-resources-inc" target="_blank" data-smartkarma-citation="entities:16546:1" rel="noopener">PNM Resources (PNM US)</a> as it could not New Mexico regulatory approval by 31 December 2023.</li>
<li>Iberdrola lost its patience but freed up €11.5 billion from that deal, together with €5.5 billion from assets sold to the Mexican Government. That's a lot for inorganic growth. </li>
<li>PNM, at 9.7x EV/Fwd EBITDA, is trading in line with comparables, thus on a multiples basis there should be limited downside to the share price.</li>
</ul>



Iberdrola SA (IBE SM)'s U.S. subsidiary Avangrid (AGR US) terminated its $8.3 billion deal for PNM Resources (PNM US) as it could not New Mexico regulatory approval by 31 December 2023.
Iberdrola lost its patience but freed up €11.5 billion from that deal, together with €5.5 billion from assets sold to the Mexican Government. That's a lot for inorganic growth. 
PNM, at 9.7x EV/Fwd EBITDA, is trading in line with comparables, thus on a multiples basis there should be limited downside to the share price.


Avangrid (Iberdrola) Terminates Merger Agreement with PNM Resources

<ul>
<li>The New Mexico Supreme Court denied a joint motion filed by <a href="https://www.smartkarma.com/entities/pnm-resources-inc" target="_blank" data-smartkarma-citation="entities:16546:1" rel="noopener">PNM Resources (PNM US)</a>, <a href="https://www.smartkarma.com/entities/avangrid-inc" target="_blank" data-smartkarma-citation="entities:26503:1" rel="noopener">Avangrid Inc (AGR US)</a> and the New Mexico Public Regulation Commission last February.</li>
<li>The New Mexico Court assess the operation in an oral hearing convened next September. The delay of the decision implies higher uncertainty about the closing of this deal.</li>
<li>I continue to believe that Iberdrola/Avangrid's acquisition will be completed. PNM shares look fairly valued on an EV/Fwd EBITDA basis, therefore I see it as a reasonably balanced risk-reward proposition. Long.
</li>
</ul>


The New Mexico Supreme Court denied a joint motion filed by PNM Resources (PNM US), Avangrid Inc (AGR US) and the New Mexico Public Regulation Commission last February.
The New Mexico Court assess the operation in an oral hearing convened next September. The delay of the decision implies higher uncertainty about the closing of this deal.
I continue to believe that Iberdrola/Avangrid's acquisition will be completed. PNM shares look fairly valued on an EV/Fwd EBITDA basis, therefore I see it as a reasonably balanced risk-reward proposition. Long.



Iberdrola/PNM Resources: Long-Distance Race

United States

Avangrid, Inc. operates as an energy services holding company. The Company engages in the regulated energy transmission and distribution business through wind and solar power, as well as natural gas utilities. Avangrid serves customers in the United States.

Avangrid (AGR US)

Iberdrola/Avangrid: Logical Move

Iberdrola SA offers $34.25/share to acquire minorities in US subsidiary Avangrid, with a 6.8% premium and $2.5 billion cost. The market was...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Keisei Electric, New World Development, Alumina Ltd, Azure Minerals, TDCX

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Last Week in Event SPACE: HS Holdings, Celltrion Pharm, NISA, PICC/PICC P&C

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Avangrid (Iberdrola) Terminates Merger Agreement with PNM Resources

Iberdrola's US subsidiary, Avangrid, cancels $8.3 billion deal for PNM Resources due to failure to obtain New Mexico approval. Iberdrola gains...

Jesus Rodriguez Aguilar

Iberdrola/PNM Resources: Long-Distance Race

The New Mexico Supreme Court denied a joint motion filed by PNM, Avangrid and the NMPRC last February. The delay of the decision implies higher...

Jesus Rodriguez Aguilar

Iberdrola/Avangrid: Logical Move

​Iberdrola SA offers $34.25/share to acquire minorities in US subsidiary Avangrid, with a 6.8% premium and $2.5 billion cost. The market was...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Keisei Electric, New World Development, Alumina Ltd, Azure Minerals, TDCX

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Last Week in Event SPACE: HS Holdings, Celltrion Pharm, NISA, PICC/PICC P&C

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Avangrid (Iberdrola) Terminates Merger Agreement with PNM Resources

​Iberdrola's US subsidiary, Avangrid, cancels $8.3 billion deal for PNM Resources due to failure to obtain New Mexico approval. Iberdrola gains...

Jesus Rodriguez Aguilar

Iberdrola/PNM Resources: Long-Distance Race

The New Mexico Supreme Court denied a joint motion filed by PNM, Avangrid and the NMPRC last February. The delay of the decision implies higher...

Jesus Rodriguez Aguilar

Iberdrola SA offers $34.25/share to acquire minorities in US subsidiary Avangrid, with a 6.8% premium and $2.5 billion cost. The market was...

Iberdrola's US subsidiary, Avangrid, cancels $8.3 billion deal for PNM Resources due to failure to obtain New Mexico approval. Iberdrola gains...