European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Naturgy's 10% self-tender offer at €26.50/share offers a 3.5% premium and ~40.6% annualized return, pending CNMV approval with settlement likely by mid-May 2025.</li>
<li>Strategic negotiations may see Taqa acquire up to 29.9% from exiting funds GIP and CVC, rebalancing Naturgy’s ownership toward industrial partners and reducing geopolitical friction.</li>
<li>With treasury shares reissued, free float could rise to 21%, boosting ADTV above €12 million and enhancing index eligibility, while dividend payouts remain attractive despite temporary uplift being unsustainable.</li>
</ul>


Naturgy's 10% self-tender offer at €26.50/share offers a 3.5% premium and ~40.6% annualized return, pending CNMV approval with settlement likely by mid-May 2025.
Strategic negotiations may see Taqa acquire up to 29.9% from exiting funds GIP and CVC, rebalancing Naturgy’s ownership toward industrial partners and reducing geopolitical friction.
With treasury shares reissued, free float could rise to 21%, boosting ADTV above €12 million and enhancing index eligibility, while dividend payouts remain attractive despite temporary uplift being unsustainable.


A Power Move: Naturgy Sparks a Strategic Rebalance

<ul>
<li>Naturgy plans a €2.5 billion share buyback at €26.5 per share, thus increasing free float and liquidity, potentially aiding index inclusion and attracting passive ETF investors.</li>
<li>The 2025-2027 strategic plan targets €6.4 billion investments, focusing on networks and renewables while maintaining EBITDA at €5.3 billion and net profit at €1.9 billion.</li>
<li>A rising dividend from €1.6 to €1.9/share by 2027, with a 100% payout ratio, provides a 7.4% 27e yield, supported by a 2.3x net debt/EBITDA, ensuring sustainability.</li>
</ul>


Naturgy plans a €2.5 billion share buyback at €26.5 per share, thus increasing free float and liquidity, potentially aiding index inclusion and attracting passive ETF investors.
The 2025-2027 strategic plan targets €6.4 billion investments, focusing on networks and renewables while maintaining EBITDA at €5.3 billion and net profit at €1.9 billion.
A rising dividend from €1.6 to €1.9/share by 2027, with a 100% payout ratio, provides a 7.4% 27e yield, supported by a 2.3x net debt/EBITDA, ensuring sustainability.


Strategic Reshuffle, Shareholder Adjustments, and Investment Outlook

<ul>
<li>Diplomatic tensions hinder acquisition: Algeria opposes Taqa’s takeover of Naturgy due to geopolitical conflicts with the UAE, complicating Spain’s energy security and disrupting acquisition negotiations.</li>
<li>Corporate governance challenges: Naturgy faces board restructuring, with five seats up for renewal and shareholder disputes over representation, potentially impacting governance stability and strategic decision-making.</li>
<li>Despite acquisition uncertainties, Naturgy is expected to report solid 2024 financial results and unveil a strategic plan focusing on decarbonization, diversification, and operational efficiency in early 2025.</li>
</ul>


Diplomatic tensions hinder acquisition: Algeria opposes Taqa’s takeover of Naturgy due to geopolitical conflicts with the UAE, complicating Spain’s energy security and disrupting acquisition negotiations.
Corporate governance challenges: Naturgy faces board restructuring, with five seats up for renewal and shareholder disputes over representation, potentially impacting governance stability and strategic decision-making.
Despite acquisition uncertainties, Naturgy is expected to report solid 2024 financial results and unveil a strategic plan focusing on decarbonization, diversification, and operational efficiency in early 2025.


Naturgy Acquisition Talks: Diplomatic and Financial Hurdles Persist

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Singtel (Singapore Telecommunications) / Technical Analysis

<ul>
<li>We have been expecting near-term downside on ACWI-US and the S&amp;P 500 since our February 27 Int’l Compass, when both ACWI-US and the S&amp;P 500 displayed false breakouts.</li>
<li>Market dynamics have continued to deteriorate to the point where we don't see it as a buying opportunity, and we believe $115 support is not likely to hold on ACWI-US.</li>
<li>Therefore, we are cautious and would get defensive, as we believe the odds of a more prolonged downturn in global equities are rising.</li>
</ul>


We have been expecting near-term downside on ACWI-US and the S&amp;P 500 since our February 27 Int’l Compass, when both ACWI-US and the S&amp;P 500 displayed false breakouts.
Market dynamics have continued to deteriorate to the point where we don't see it as a buying opportunity, and we believe $115 support is not likely to hold on ACWI-US.
Therefore, we are cautious and would get defensive, as we believe the odds of a more prolonged downturn in global equities are rising.


Odds of a Prolonged Downturn Are Rising; We Are Cautious; Get Defensive

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>If you don't think <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>'s Standalone Plan has legs to go north of here, or ACT gets its act together,  then you should sell into strength.</li>
<li>
<a href="https://www.smartkarma.com/entities/enn-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:316:1" rel="noopener">ENN Energy (2688 HK)</a>'s cash and scrip (into a unlisted H-share-equivalent entity) Offer was not what the doctor ordered.</li>
<li>
<a href="https://www.smartkarma.com/entities/sun-corp" target="_blank" data-smartkarma-citation="entities:10803:1" rel="noopener">Sun Corp (6736 JP)</a> is cheap to its holding in <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite DI (CLBT US)</a>. How cheap depends on the form and structure of its eventual exit.</li>
</ul>


If you don't think Seven &amp; I (3382 JP)'s Standalone Plan has legs to go north of here, or ACT gets its act together,  then you should sell into strength.

ENN Energy (2688 HK)'s cash and scrip (into a unlisted H-share-equivalent entity) Offer was not what the doctor ordered.

Sun Corp (6736 JP) is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit.


Last Week in Event SPACE: Seven & I, ENN Energy, Sun Corp, Great Eastern Holdings

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.

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Naturgy Energy Group SA (NTGY SM)

A Power Move: Naturgy Sparks a Strategic Rebalance

Naturgy's self-tender offer at €26.50/share aims to rebalance ownership, boost free float, and enhance index eligibility, pending CNMV approval...

Jesus Rodriguez Aguilar

Strategic Reshuffle, Shareholder Adjustments, and Investment Outlook

Naturgy plans €2.5 billion share buyback at €26.5/share, aims for €6.4 billion investments in networks and renewables by 2027, with rising...

Jesus Rodriguez Aguilar

Naturgy Acquisition Talks: Diplomatic and Financial Hurdles Persist

Algeria's opposition to Taqa's takeover of Naturgy complicates Spain's energy security, while Naturgy faces corporate governance challenges and...

Jesus Rodriguez Aguilar

Odds of a Prolonged Downturn Are Rising; We Are Cautious; Get Defensive

Odds of a Prolonged Downturn are Rising; We are Cautious; Get Defensive; $115 on ACWI-US Remains Key Level, and is at Risk of Breakdown. Actionable...

Vermilion Research

Last Week in Event SPACE: Seven & I, ENN Energy, Sun Corp, Great Eastern Holdings

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

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

A Power Move: Naturgy Sparks a Strategic Rebalance

​Naturgy's self-tender offer at €26.50/share aims to rebalance ownership, boost free float, and enhance index eligibility, pending CNMV approval...

Jesus Rodriguez Aguilar

Strategic Reshuffle, Shareholder Adjustments, and Investment Outlook

​Naturgy plans €2.5 billion share buyback at €26.5/share, aims for €6.4 billion investments in networks and renewables by 2027, with rising...

Jesus Rodriguez Aguilar

Naturgy Acquisition Talks: Diplomatic and Financial Hurdles Persist

​Algeria's opposition to Taqa's takeover of Naturgy complicates Spain's energy security, while Naturgy faces corporate governance challenges and...

Jesus Rodriguez Aguilar

Odds of a Prolonged Downturn Are Rising; We Are Cautious; Get Defensive

Odds of a Prolonged Downturn are Rising; We are Cautious; Get Defensive; $115 on ACWI-US Remains Key Level, and is at Risk of Breakdown. Actionable...

Vermilion Research

Last Week in Event SPACE: Seven & I, ENN Energy, Sun Corp, Great Eastern Holdings

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

Naturgy's self-tender offer at €26.50/share aims to rebalance ownership, boost free float, and enhance index eligibility, pending CNMV approval...

Naturgy plans €2.5 billion share buyback at €26.5/share, aims for €6.4 billion investments in networks and renewables by 2027, with rising...

Algeria's opposition to Taqa's takeover of Naturgy complicates Spain's energy security, while Naturgy faces corporate governance challenges and...