European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>TAQA has admitted considering a full takeover of <a href="https://www.smartkarma.com/entities/naturgy-energy-group-sa" target="_blank" data-smartkarma-citation="entities:21271:1" rel="noopener">Naturgy Energy Group SA (NTGY SM)</a> and discussions with CriteriaCaixa regarding a possible cooperation pact, with CriteriaCaixa remaining a shareholder.</li>
<li>GIP and CVC have exceeded the typical investment maturity period and may be willing to dispose of their stakes in Naturgy if presented with a good offer.</li>
<li>The possibility of corporate actions could bolster the stock from these levels. I assign a &gt;50% probability to a full/partial takeover bid at around €25/26 per share actually materializing.</li>
</ul>


TAQA has admitted considering a full takeover of Naturgy Energy Group SA (NTGY SM) and discussions with CriteriaCaixa regarding a possible cooperation pact, with CriteriaCaixa remaining a shareholder.
GIP and CVC have exceeded the typical investment maturity period and may be willing to dispose of their stakes in Naturgy if presented with a good offer.
The possibility of corporate actions could bolster the stock from these levels. I assign a &gt;50% probability to a full/partial takeover bid at around €25/26 per share actually materializing.


<ul>
<li>The Discounts to NAV of covered holdcos mainly widened during April. Discounts to NAV: C.F.Alba, 49.1% (vs. 47.3%); GBL, 39% (vs. 38.1%); Heineken Holding, 17.3% (vs 16.7%); </li>
<li>Industrivärden C, 4.7% (vs. 1.4%); Investor B, 8.3% (vs. 6.1%); Porsche Automobile Holding, 41.1% (vs. 45.4%). Rio DLC spread tightened to 22.5% (vs. to 24.9%).</li>
<li>What seems interesting: Porsche SE vs. listed assets and the Rio DLC (long RIO LN/short RIO AU).</li>
</ul>


The Discounts to NAV of covered holdcos mainly widened during April. Discounts to NAV: C.F.Alba, 49.1% (vs. 47.3%); GBL, 39% (vs. 38.1%); Heineken Holding, 17.3% (vs 16.7%); 
Industrivärden C, 4.7% (vs. 1.4%); Investor B, 8.3% (vs. 6.1%); Porsche Automobile Holding, 41.1% (vs. 45.4%). Rio DLC spread tightened to 22.5% (vs. to 24.9%).
What seems interesting: Porsche SE vs. listed assets and the Rio DLC (long RIO LN/short RIO AU).


Selected European HoldCos and DLC: April'24 Report

Equity Bottom-Up

Naturgy Energy Group SA / Equity Bottom-Up

<ul>
<li>S&amp;P has raised <a href="https://www.smartkarma.com/entities/naturgy-energy-group-sa" target="_blank" data-smartkarma-citation="entities:21271:1" rel="noopener">Naturgy Energy Group SA (NTGY SM)</a>'s credit outlook from negative to stable considering that the company may not finally carry out the Gemini spin-off project.</li>
<li>Naturgy's shares do not trade on fundamentals, rather on expectations that IFM tries to increase its stake (free float is just 15%). There's some potential overhang risk though.</li>
<li>IFM has not acquired any significant stake since April, but I would not short the shares as IFM could resume share purchases on an opportunistic basis.</li>
</ul>


S&amp;P has raised Naturgy Energy Group SA (NTGY SM)'s credit outlook from negative to stable considering that the company may not finally carry out the Gemini spin-off project.
Naturgy's shares do not trade on fundamentals, rather on expectations that IFM tries to increase its stake (free float is just 15%). There's some potential overhang risk though.
IFM has not acquired any significant stake since April, but I would not short the shares as IFM could resume share purchases on an opportunistic basis.


Equity Analyst, Event-driven, Quiddity Advisors

Janaghan Jeyakumar, CFA

Equity Analyst, Event-driven

Quiddity Advisors

Pan-Asia Catalysts/Events

<ul>
<li>The EURO STOXX 50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.</li>
<li>Historically, these Rebalance events have had significant volume impact and they generally involve large cap names. </li>
<li>In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2022.</li>
</ul>


The EURO STOXX 50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.
Historically, these Rebalance events have had significant volume impact and they generally involve large cap names. 
In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2022.


Euro Stoxx 50 Quiddity Leaderboard for Sep 22: Eurozone's Annual Big Impact Rebal Trades

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

<ul>
<li>
<a href="https://www.smartkarma.com/entities/pasona-group-inc" target="_blank" data-smartkarma-citation="entities:15778:1" rel="noopener">Pasona (2168 JP)</a>will pay out 10-20% of the extraordinary gain from the <a href="https://www.smartkarma.com/entities/benefit-one-inc" target="_blank" data-smartkarma-citation="entities:14502:1" rel="noopener">Benefit One (2412 JP)</a> sale. It will take its sweet time doing so. For no apparent reason.</li>
<li>
<a href="https://www.smartkarma.com/entities/hang-lung-properties-ltd" target="_blank" data-smartkarma-citation="entities:49:1" rel="noopener">Hang Lung Properties (101 HK)</a>'s first-ever scrip dividend provides the means for the Chan Family to indirectly chip away at minorities. </li>
<li>
<a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys Automation Technologies (HOLI US)</a> accountant resignation announcement is a nothing burger. An  update on PRC regulatory approvals would be welcome about now though. </li>
</ul>



Pasona (2168 JP)will pay out 10-20% of the extraordinary gain from the Benefit One (2412 JP) sale. It will take its sweet time doing so. For no apparent reason.

Hang Lung Properties (101 HK)'s first-ever scrip dividend provides the means for the Chan Family to indirectly chip away at minorities. 

Hollysys Automation Technologies (HOLI US) accountant resignation announcement is a nothing burger. An  update on PRC regulatory approvals would be welcome about now though. 


Last Week in Event SPACE: Pasona/Benefit One, Hang Lung Properties, Hollysys, Azure Minerals

Spain

Naturgy Energy Group S.A. distributes natural gas. The Company operates gas storage facilities, as well as owns and operates a fiber optic backbone telecommunications networks. Naturgy Energy Group also markets energy management products, household gas appliances, and installs gas heating systems. Naturgy Energy serves clients worldwide.

Naturgy Energy Group SA (NTGY SM)

TAQA/Naturgy: Takeover Interest

TAQA has admitted considering a full takeover of Naturgy Energy Group SA (NTGY SM) and discussions with CriteriaCaixa regarding a possible...

Jesus Rodriguez Aguilar

Selected European HoldCos and DLC: April'24 Report

The Discounts to NAV of covered holdcos mainly widened during April. What seems interesting: Porsche SE vs. listed assets and the Rio DLC (long RIO...

Jesus Rodriguez Aguilar

Gemini Postponed Sine Die

Standard & Poor's has raised Naturgy's credit outlook from negative to stable given the possibility that the company will not finally carry out the...

Jesus Rodriguez Aguilar

Euro Stoxx 50 Quiddity Leaderboard for Sep 22: Eurozone's Annual Big Impact Rebal Trades

There are 3 ADDs/DELs based on current data but these rankings could fluctuate. There might some interesting pair trades involving the highest...

Janaghan Jeyakumar, CFA

Last Week in Event SPACE: Pasona/Benefit One, Hang Lung Properties, Hollysys, Azure Minerals

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