European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Rejected Offer: Grifols' independent committee rejected Brookfield's proposed valuation of €10.50 per Class A share €7.62 per Class B share, citing significant undervaluation of the company's long-term prospects.</li>
<li>Stakeholder Dynamics: Brookfield seeks a statutory amendment to differentiate Class A and B share prices, while opposition from Brandes (13.5% of Class B shares) and Mason complicates negotiations.</li>
<li>Financial Recovery: Grifols achieved 12% revenue growth in Q3 2024, reduced net debt to €8.1 billion, and targets a 4.5x leverage ratio by year-end, supporting improved financial stability.</li>
</ul>


Rejected Offer: Grifols' independent committee rejected Brookfield's proposed valuation of €10.50 per Class A share €7.62 per Class B share, citing significant undervaluation of the company's long-term prospects.
Stakeholder Dynamics: Brookfield seeks a statutory amendment to differentiate Class A and B share prices, while opposition from Brandes (13.5% of Class B shares) and Mason complicates negotiations.
Financial Recovery: Grifols achieved 12% revenue growth in Q3 2024, reduced net debt to €8.1 billion, and targets a 4.5x leverage ratio by year-end, supporting improved financial stability.


Lowball Non-Binding Indication from Brookfield

<ul>
<li>Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have tightened, 9 widened). Most spreads that were already tightening, kept doing so.</li>
<li>Most spreads that were already tightening, kept doing so. Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe.</li>
<li>Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.</li>
</ul>


Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have tightened, 9 widened). Most spreads that were already tightening, kept doing so.
Most spreads that were already tightening, kept doing so. Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe.
Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.


Liquid Universe of European Ordinary and Preferred Shares: November‘24 Report

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>There are people who'll take profit in <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I (3382 JP)</a> because of path dependency til year-end. It will drag out a while: buy the dips, trim on pops.</li>
<li>Just like in <a href="https://www.smartkarma.com/entities/lufax-holding-ltd-b751749a-8feb-4b4d-85a7-d99ac0308fe7" target="_blank" data-smartkarma-citation="entities:40067:1" rel="noopener">Lufax Holding (6623 HK)</a>'s special dividend, expect Ping An to boost its holding in <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Healthcare and Technology (1833 HK)</a> via the stealthy scrip dividend option. </li>
<li>The landscape for <a href="https://www.smartkarma.com/entities/nec-networks-system-integr" target="_blank" data-smartkarma-citation="entities:16396:1" rel="noopener">Nec Networks &amp; System Integr (1973 JP)</a> has FULLY changed. The details now matter quite a bit. NEC has two basic choices. Neither are that palatable.  </li>
</ul>


There are people who'll take profit in Seven &amp; I (3382 JP) because of path dependency til year-end. It will drag out a while: buy the dips, trim on pops.
Just like in Lufax Holding (6623 HK)'s special dividend, expect Ping An to boost its holding in Ping An Healthcare and Technology (1833 HK) via the stealthy scrip dividend option. 
The landscape for Nec Networks &amp; System Integr (1973 JP) has FULLY changed. The details now matter quite a bit. NEC has two basic choices. Neither are that palatable.  


Last Week in Event SPACE: Seven & I, PA Gooddoctor, Nec Networks, Genscript/Legend, ASM PT, Hanwha

<ul>
<li>Brookfield has secured an €11 billion loan to refinance Grifols’ €9.2 billion net debt, paving the way for a potential takeover and significant control over Grifols’ operations.</li>
<li>Grifols' Q3 results reveal 12% revenue growth, strong free cash flow, and lower net debt, with 2024 targets reaffirmed for 7%+ revenue growth, €1.8 billion EBITDA, and 4.5x leverage.</li>
<li>The narrowing discount between Grifols’ A and B shares signals market optimism, reflecting confidence in a takeover. This would be my preferred strategy of playing this situation.</li>
</ul>


Brookfield has secured an €11 billion loan to refinance Grifols’ €9.2 billion net debt, paving the way for a potential takeover and significant control over Grifols’ operations.
Grifols' Q3 results reveal 12% revenue growth, strong free cash flow, and lower net debt, with 2024 targets reaffirmed for 7%+ revenue growth, €1.8 billion EBITDA, and 4.5x leverage.
The narrowing discount between Grifols’ A and B shares signals market optimism, reflecting confidence in a takeover. This would be my preferred strategy of playing this situation.


<ul>
<li>The bigger question for investors is whether <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a> will keep up with global auto market needs or will they suffer as Toyota may suffer?</li>
<li>The FSS may put the breaks on <a href="https://www.smartkarma.com/entities/korea-zinc-co-ltd" target="_blank" data-smartkarma-citation="entities:17944:1" rel="noopener">Korea Zinc (010130 KS)</a>'s massive capital raise. </li>
<li>Murakami-San has won <a href="https://www.smartkarma.com/entities/exedy-corp" target="_blank" data-smartkarma-citation="entities:6516:1" rel="noopener">Exedy Corp (7278 JP)</a>. The company has decided to up its dividend payout and future dividend payout ratio and buy back a boatload of shares. </li>
</ul>


The bigger question for investors is whether Denso Corp (6902 JP) will keep up with global auto market needs or will they suffer as Toyota may suffer?
The FSS may put the breaks on Korea Zinc (010130 KS)'s massive capital raise. 
Murakami-San has won Exedy Corp (7278 JP). The company has decided to up its dividend payout and future dividend payout ratio and buy back a boatload of shares. 


Last Week in Event SPACE: Denso/Toyota, Korea Zinc, Exedy, Good Drinks, Shinsegae

Spain

Grifols S.A. develops, manufactures, and markets plasma derivatives, IV Therapy, enteral nutrition, diagnostic systems, and medical materials.

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Grifols SA (GRF SM)

Lowball Non-Binding Indication from Brookfield

Rejected Offer: Grifols' independent committee rejected Brookfield's proposed valuation of €10.50 per Class A share, citing significant...

Jesus Rodriguez Aguilar

Liquid Universe of European Ordinary and Preferred Shares: November‘24 Report

Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Seven & I, PA Gooddoctor, Nec Networks, Genscript/Legend, ASM PT, Hanwha

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

Brookfield Refinances Grifols' Debt

Brookfield has secured an €11 billion loan to refinance Grifols’ debt, paving the way for a potential takeover and significant control over...

Jesus Rodriguez Aguilar

Last Week in Event SPACE: Denso/Toyota, Korea Zinc, Exedy, Good Drinks, Shinsegae

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

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