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Richard Howe

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Stock Spin-Off Investing

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Stock Spin-offs

Event-Driven

<ul><li>I want to use my introduction to provide some comments on Howard Hughes (HHH).</li><li>Bill Ackman’s Pershing Square Capital Management has disclosed a new offer related to Howard Hughes.</li><li>The proposal is that Pershing Square Capital Management purchases 10 million newly issued shares at $90 each, totaling $900 million, which would increase Pershing Square’s stake from 37.6% to 48%.</li></ul>

I want to use my introduction to provide some comments on Howard Hughes (HHH).Bill Ackman’s Pershing Square Capital Management has disclosed a new offer related to Howard Hughes.The proposal is that Pershing Square Capital Management purchases 10 million newly issued shares at $90 each, totaling $900 million, which would increase Pershing Square’s stake from 37.6% to 48%.

Weekly Update (SNDK, LBTYA, MRP, HHH, GTX)

European Event-Driven Analyst

Jesus Rodriguez Aguilar

<ul>
<li>Liberty has waived the 95% threshold condition. Liberty has now mandatorily opened again the tender given it owns more than 90% (93.43%),  on same terms until 13 September (settlement 27 September).</li>
<li>At 5.9x EV/Fwd EBITDA (vs. 5.4x EV/20e EBITDA for Orange Belgium minorities), the offer is relatively cheap, but also reflects the uncertainties surrounding Citymesh's entrance and risk of market share losses.</li>
<li>Spread is positive. After the second acceptance period closes, I believe the delisting is extremely likely. With limited liquidity and floor dividend no longer guaranteed, recommendation is accept the offer. </li>
</ul>


Liberty has waived the 95% threshold condition. Liberty has now mandatorily opened again the tender given it owns more than 90% (93.43%),  on same terms until 13 September (settlement 27 September).
At 5.9x EV/Fwd EBITDA (vs. 5.4x EV/20e EBITDA for Orange Belgium minorities), the offer is relatively cheap, but also reflects the uncertainties surrounding Citymesh's entrance and risk of market share losses.
Spread is positive. After the second acceptance period closes, I believe the delisting is extremely likely. With limited liquidity and floor dividend no longer guaranteed, recommendation is accept the offer. 


Liberty/​​Telenet: Re-Opening of Tender Offer

<ul>
<li>Telenet has announced the publication of the prospectus. The Board of Directors of Telenet has prepared a response memorandum in which it sets out its recommendation of the Offer.</li>
<li>The offer is opportunistic and optically generous, with neither interloper risk nor sweetening to be expected. I believe most investors will cash out. Liberty could eventually drop the acceptance threshold.</li>
<li>Given the ambiguity surrounding both the company and the sector in Belgium, I still think Liberty might acquire Telenet for almost a bargain. Spread is 2.38%/19.8% (gross/annualised).</li>
</ul>


Telenet has announced the publication of the prospectus. The Board of Directors of Telenet has prepared a response memorandum in which it sets out its recommendation of the Offer.
The offer is opportunistic and optically generous, with neither interloper risk nor sweetening to be expected. I believe most investors will cash out. Liberty could eventually drop the acceptance threshold.
Given the ambiguity surrounding both the company and the sector in Belgium, I still think Liberty might acquire Telenet for almost a bargain. Spread is 2.38%/19.8% (gross/annualised).


Liberty/​Telenet: Opening of Acceptance Period

Value Investing

Vladimir Dimitrov, CFA

Equity Bottom-Up

<ul><li>Liberty Global has been a challenging name to hold through its years-long restructuring process.</li><li>In spite of the disappointing returns, the company has secured key deals necessary for fixed-mobile convergence in all of its major markets.</li><li>The company still trades at discount to its fair value, in spite of improving fundamentals.</li></ul>

Liberty Global has been a challenging name to hold through its years-long restructuring process.In spite of the disappointing returns, the company has secured key deals necessary for fixed-mobile convergence in all of its major markets.The company still trades at discount to its fair value, in spite of improving fundamentals.

Liberty Global: Securing Long-Term Competitive Advantages

Quality-Value Investing

Marc Melendez, CFA

Emerging Market Small and Mid Cap Equities

Reperio Capital

Reperio Capital Research was founded in 2013 with the goal of better serving the investment community with in-depth, high quality, value oriented research.

Reperio means to discover in latin. Using value investing principles, we aim to discover a minimum of 12 investment opportunities per year within the Emerging Markets Small and Mid Cap universe.

We take a business owners perspective with a long term investment horizon. We conduct bottom up, fundamental research. We focus on downside risks and require a significant margin of safety in any investment to prevent the permanent loss of capital. All factors differentiating our research from the short term, trading focus of traditional research providers.

<a href="https://www.smartkarma.com/entities/link-net-tbk-pt" target="_blank" data-smartkarma-citation="entities:1050:1" rel="noopener">Link Net (LINK IJ)</a> is a broadband and cable TV provider in Indonesia. It is undervalued under all scenarios with 54% upside to the 2021 fair value per share in bear case and 143% upside to the 2021 fair valuer per share in the base case.The company recently embarked on a new subscriber growth strategy, which so far has been successful. Over the past two quarters, Link Net added an average of 58,154 new subscribers per quarter. Over the previous five years, the average quarterly rate of new subscribers was 12,232. ARPU fell with the subscriber growth, but it seems to be stabilizing.In addition to the new subscriber growth strategy, the company is an efficient operator with a five-year average ROIC of 24%. It also regularly buys back shares when it thinks the company is undervalued. Since IPO in 2014, 9.6% of shares issued have been repurchased with most being canceled.The company also has room to increase the amount of debt in its capital structure. At 3 times EBITDA, Link Net could raise debt by IDR5.5 trillion, which is just below its current market cap of IDR6 trillion.Trading on a EV/TTM EBIT of 5.8 times, Link Net is attractive at current valuations.

Link Net (LINK IJ) is a broadband and cable TV provider in Indonesia. It is undervalued under all scenarios with 54% upside to the 2021 fair value per share in bear case and 143% upside to the 2021 fair valuer per share in the base case.The company recently embarked on a new subscriber growth strategy, which so far has been successful. Over the past two quarters, Link Net added an average of 58,154 new subscribers per quarter. Over the previous five years, the average quarterly rate of new subscribers was 12,232. ARPU fell with the subscriber growth, but it seems to be stabilizing.In addition to the new subscriber growth strategy, the company is an efficient operator with a five-year average ROIC of 24%. It also regularly buys back shares when it thinks the company is undervalued. Since IPO in 2014, 9.6% of shares issued have been repurchased with most being canceled.The company also has room to increase the amount of debt in its capital structure. At 3 times EBITDA, Link Net could raise debt by IDR5.5 trillion, which is just below its current market cap of IDR6 trillion.Trading on a EV/TTM EBIT of 5.8 times, Link Net is attractive at current valuations.

Link Net (LINK:IJ)- New Subscriber Growth Strategy Working. The Company Is Undervalued.

Bermuda

Liberty Global is an international telecommunications company that provides converged broadband internet, video, fixed-line telephony, and mobile communications services to residential customers and businesses primarily across Europe. The company also actively invests in technology, media, sports, and infrastructure sectors through its Liberty Growth division. It was formed in 2005 and is headquartered in London, United Kingdom, with additional principal offices in Amsterdam and Denver.

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Liberty Global (LBTYA US)

Weekly Update (SNDK, LBTYA, MRP, HHH, GTX)

I want to use my introduction to provide some comments on Howard Hughes (HHH). Bill Ackman’s Pershing Square Capital Management has disclosed a new...

Richard Howe

Liberty/Telenet: Re-Opening of Tender Offer

The offer is relatively cheap, but reflects the uncertainties surrounding Citymesh's entrance and market share losses. After the reopened period...

Jesus Rodriguez Aguilar

Liberty/Telenet: Opening of Acceptance Period

On 7 June, Telenet announced the publication of the prospectus. The Board of Directors of Telenet has prepared a response memorandum in which it...

Jesus Rodriguez Aguilar

Liberty Global: Securing Long-Term Competitive Advantages

Liberty Global has been a challenging name to hold through its years-long restructuring process. In spite of the disappointing returns, the...

Vladimir Dimitrov, CFA

Link Net (LINK:IJ)- New Subscriber Growth Strategy Working. The Company Is Undervalued.

Link Net is a growing, efficient cable operator that recently embarked on a new subscriber growth strategy. It is undervalued under all scenarios...

Reperio Capital

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52-week Range

Market Cap (USDm)

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Weekly Update (SNDK, LBTYA, MRP, HHH, GTX)

I want to use my introduction to provide some comments on Howard Hughes (HHH). Bill Ackman’s Pershing Square Capital Management has disclosed a new...

Richard Howe

Liberty/​​Telenet: Re-Opening of Tender Offer

The offer is relatively cheap, but reflects the uncertainties surrounding Citymesh's entrance and market share losses. After the reopened period...

Jesus Rodriguez Aguilar

Liberty/​Telenet: Opening of Acceptance Period

On 7 June, Telenet announced the publication of the prospectus. The Board of Directors of Telenet has prepared a response memorandum in which it...

Jesus Rodriguez Aguilar

Liberty Global: Securing Long-Term Competitive Advantages

Liberty Global has been a challenging name to hold through its years-long restructuring process. In spite of the disappointing returns, the...

Vladimir Dimitrov, CFA

Link Net (LINK:IJ)- New Subscriber Growth Strategy Working. The Company Is Undervalued.

Link Net is a growing, efficient cable operator that recently embarked on a new subscriber growth strategy. It is undervalued under all scenarios...

Reperio Capital

Liberty/Telenet: Re-Opening of Tender Offer

Liberty/Telenet: Opening of Acceptance Period