European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Davidson Kempner and others may seek an improved offer of up to 3,500p/share, 29.7x EV/Fwd EBIT, in line with Ideagen's acquisition multiples. Gross spread is +2.38%.</li>
<li>Assuming AVEVA can reach 2018a 34.7% EBITDA margins and increase revenues, the offer price would seem cheap. An increase to 3,300p seems feasible, £4,073 million, similar to the Bridge Facility.</li>
<li>Current net debt/EBITDA is 1.3x and EBIT/interest is 33.6x, so it could comfortably take on that additional debt. At 3,300p, proforma net debt/EBITDA would be 1.9x, before adding any synergies.</li>
</ul>


Davidson Kempner and others may seek an improved offer of up to 3,500p/share, 29.7x EV/Fwd EBIT, in line with Ideagen's acquisition multiples. Gross spread is +2.38%.
Assuming AVEVA can reach 2018a 34.7% EBITDA margins and increase revenues, the offer price would seem cheap. An increase to 3,300p seems feasible, £4,073 million, similar to the Bridge Facility.
Current net debt/EBITDA is 1.3x and EBIT/interest is 33.6x, so it could comfortably take on that additional debt. At 3,300p, proforma net debt/EBITDA would be 1.9x, before adding any synergies.


Schneider Electric/​Aveva: Potential Offer Price Sweetening

<ul>
<li>Schneider has agreed a 3,100p (+13p interim) cash offer for the remaining 40.86% of AVEVA (41% premium, 26.7x EV/Fwd EBIT, 30.5x Fwd P/E), which some dub opportunistic.</li>
<li>The offer price is in line with average multiples for the last 5Y, and there's execution risk in the model transition of AVEVA, but riches may lie ahead. </li>
<li>Gross spread is +0.8% (+interim), the market expects a sweetening (no large shareholder has irrevocably undertaken to tender); the daily average GBP volume since 23 August has been c.£62 million.</li>
</ul>


Schneider has agreed a 3,100p (+13p interim) cash offer for the remaining 40.86% of AVEVA (41% premium, 26.7x EV/Fwd EBIT, 30.5x Fwd P/E), which some dub opportunistic.
The offer price is in line with average multiples for the last 5Y, and there's execution risk in the model transition of AVEVA, but riches may lie ahead. 
Gross spread is +0.8% (+interim), the market expects a sweetening (no large shareholder has irrevocably undertaken to tender); the daily average GBP volume since 23 August has been c.£62 million.


Schneider Electric/Aveva: Recommended Minorities Buyout

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/tuya-inc" target="_blank" data-smartkarma-citation="entities:32158:1" rel="noopener">Tuya Inc (1869782D US)</a> provides a backend service for IoT (internet of things) device makers. Tuya offers its customers a Platform-as-a-Service (PaaS) for IoT devices that handles the connectivity, device software and application development. In 2020, Tuya was the largest IoT PaaS business globally as measured by the volume of smart devices powered, according to CIC.</p><p>Tuya is backed by <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a> (10.8% stake) and NEA (23.9% stake). Jeff Immelt, the former chairman and CEO of <a href="https://www.smartkarma.com/entities/general-electric-co" target="_blank" data-smartkarma-citation="entities:782:1" rel="noopener">General Electric Co (GE US)</a>, is a venture partner at NEA and has been appointed as a director at Tuya. Tuya has filed for an NYSE IPO to raise proceeds of $1 billion, according to press reports. </p><p>Despite the growing user demand for smart IoT enabled devices driven by increased affordability and improved user experiences, most products are not connected yet. Devices related to smart home and smart business reached 762.8 million in 2019 and is expected to grow to 2.5 billion by 2024, representing a CAGR of 26.7%, according to CIC. This is a huge opportunity for companies that can offer their customers a cost-effective solution to bring their products online. </p><div class="content-highlight"><p>PaaS is a key enabler to accelerate the launch of smart IoT enabled devices by making the software development cycles and feature update process time and cost-efficient. PaaS is a platform where third-party providers deliver software, infrastructure and hardware tools needed for software developers to build and manage software efficiently. Tuya’s PaaS solutions are well-positioned to benefit from the rising need for third-party IoT PaaS providers who can provide the required tools. Overall, we believe that Tuya’s fundamentals are attractive.</p></div>

Tuya Inc (1869782D US) provides a backend service for IoT (internet of things) device makers. Tuya offers its customers a Platform-as-a-Service (PaaS) for IoT devices that handles the connectivity, device software and application development. In 2020, Tuya was the largest IoT PaaS business globally as measured by the volume of smart devices powered, according to CIC.Tuya is backed by Tencent Holdings (700 HK) (10.8% stake) and NEA (23.9% stake). Jeff Immelt, the former chairman and CEO of General Electric Co (GE US), is a venture partner at NEA and has been appointed as a director at Tuya. Tuya has filed for an NYSE IPO to raise proceeds of $1 billion, according to press reports. Despite the growing user demand for smart IoT enabled devices driven by increased affordability and improved user experiences, most products are not connected yet. Devices related to smart home and smart business reached 762.8 million in 2019 and is expected to grow to 2.5 billion by 2024, representing a CAGR of 26.7%, according to CIC. This is a huge opportunity for companies that can offer their customers a cost-effective solution to bring their products online. PaaS is a key enabler to accelerate the launch of smart IoT enabled devices by making the software development cycles and feature update process time and cost-efficient. PaaS is a platform where third-party providers deliver software, infrastructure and hardware tools needed for software developers to build and manage software efficiently. Tuya’s PaaS solutions are well-positioned to benefit from the rising need for third-party IoT PaaS providers who can provide the required tools. Overall, we believe that Tuya’s fundamentals are attractive.

<p><a href="https://www.smartkarma.com/entities/rib-software-ag" target="_blank" data-smartkarma-citation="entities:21701:1" rel="noopener">RIB Software AG (RIB GR)</a> is an application software company that develops and markets planning and control software solutions to the building and construction industry. On 13 February, its shares rose around 40% on the back of a voluntary public tender offer from <a href="https://www.smartkarma.com/entities/schneider-electric-se" target="_blank" data-smartkarma-citation="entities:21555:1" rel="noopener">Schneider Electric Se (SU FP)</a>. Schneider Electric has offered €29.00 cash per share, which will not be deducted for dividends. </p><div class="content-highlight"><p>In Germany, bidders face three big hurdles if they want to win control of listed companies - two-tier board system, high control threshold and far-reaching safeguards for minority shareholders. Overall, we believe that the offer is attractive and has a strong chance to meet the minimum acceptance threshold, but offers limited DPLTA arbitrage opportunity. </p></div>

RIB Software AG (RIB GR) is an application software company that develops and markets planning and control software solutions to the building and construction industry. On 13 February, its shares rose around 40% on the back of a voluntary public tender offer from Schneider Electric Se (SU FP). Schneider Electric has offered €29.00 cash per share, which will not be deducted for dividends. In Germany, bidders face three big hurdles if they want to win control of listed companies - two-tier board system, high control threshold and far-reaching safeguards for minority shareholders. Overall, we believe that the offer is attractive and has a strong chance to meet the minimum acceptance threshold, but offers limited DPLTA arbitrage opportunity. 

RIB Software Tender Offer from Schneider Electric

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>Schneider Electric on Thursday (13<sup>th</sup> February) announced that it will be launching a voluntary public tender offer to acquire Germany’s RIB Software for EUR29 per share, valuing RIB at approximately EUR1.4bn. The offer is supported by RIB Software’s administrative board.</li>
<li>The offer price of EUR29 per share implies a premium of 40.6% on RIB’s last close of EUR20.62 per share on Wednesday.</li>
<li>The acquisition will complement Schneider’s Smart Buildings vision and will help enhance Schneider’s capabilities in the construction/building phase where digitalisation is still lower and as a result suffers from inefficiencies.</li>
</ul>


Schneider Electric on Thursday (13th February) announced that it will be launching a voluntary public tender offer to acquire Germany’s RIB Software for EUR29 per share, valuing RIB at approximately EUR1.4bn. The offer is supported by RIB Software’s administrative board.
The offer price of EUR29 per share implies a premium of 40.6% on RIB’s last close of EUR20.62 per share on Wednesday.
The acquisition will complement Schneider’s Smart Buildings vision and will help enhance Schneider’s capabilities in the construction/building phase where digitalisation is still lower and as a result suffers from inefficiencies.


Schneider Electric to Buy Germany’s RIB Software for EUR1.4bn

France

Schneider Electric SE manufactures power distribution and automation systems. The Company produces circuit breakers, remote installation management equipment, panelboards, programmable logic controllers, industrial control products, detectors, human-machine interfaces, and process controls.  Schneider's products are sold various brands.

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Schneider Electric Se (SU FP)

Schneider Electric/Aveva: Potential Offer Price Sweetening

Hedge fund Davidson Kempner Capital Management is building a stake in Aveva (currently 3.5%) and will join others in pushing Schneider Electric...

Jesus Rodriguez Aguilar

Schneider Electric/Aveva: Recommended Minorities Buyout

The offer price does not come as a surprise and the operation, however dilutive, makes strategic sense for Schneider. Gross spread is positive and...

Jesus Rodriguez Aguilar

Tuya IPO Initiation: Connected Future

Tencent-backed Tuya has filed for an NYSE IPO to raise proceeds of $1 billion, according to press reports. Overall, we believe that Tuya’s...

Arun George

RIB Software Tender Offer from Schneider Electric

RIB Software AG (RIB GR) is an application software company that develops and markets planning and control software solutions to the building and...

Arun George

Schneider Electric to Buy Germany’s RIB Software for EUR1.4bn

Schneider Electric on Thursday (13th February) announced that it will be launching a voluntary public tender offer to acquire Germany’s RIB...

Shifara Samsudeen, FCMA, CGMA

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Schneider Electric/​Aveva: Potential Offer Price Sweetening

Hedge fund Davidson Kempner Capital Management is building a stake in Aveva (currently 3.5%) and will join others in pushing Schneider Electric...

Jesus Rodriguez Aguilar

Schneider Electric/Aveva: Recommended Minorities Buyout

The offer price does not come as a surprise and the operation, however dilutive, makes strategic sense for Schneider. Gross spread is positive and...

Jesus Rodriguez Aguilar

Tuya IPO Initiation: Connected Future

Tencent-backed Tuya has filed for an NYSE IPO to raise proceeds of $1 billion, according to press reports. Overall, we believe that Tuya’s...

Arun George

RIB Software Tender Offer from Schneider Electric

RIB Software AG (RIB GR) is an application software company that develops and markets planning and control software solutions to the building and...

Arun George

Schneider Electric to Buy Germany’s RIB Software for EUR1.4bn

Schneider Electric on Thursday (13th February) announced that it will be launching a voluntary public tender offer to acquire Germany’s RIB...

Shifara Samsudeen, FCMA, CGMA

Schneider Electric/Aveva: Potential Offer Price Sweetening