European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

Siemens Gamesa Renewable Energy, S.A. / Event-Driven

<ul>
<li>Q3 2022 results were received as weak by the market. Guidance was (again) revised downwards. Otherwise, the takeover bid continues in the process of authorization by the CNMV.</li>
<li>I don't expect any relevant changes in the offer: Siemens Energy already has control, operating problems persist and the financial position continues to deteriorate. Downwards risks to consensus estimates persist.</li>
<li>Gross spread is 0.33%. The estimated annual return is 1.63% (assuming settlement on 24 October). Sell on strength/tender during the offer in case there's a (low probability) improvement in the offer.</li>
</ul>


Q3 2022 results were received as weak by the market. Guidance was (again) revised downwards. Otherwise, the takeover bid continues in the process of authorization by the CNMV.
I don't expect any relevant changes in the offer: Siemens Energy already has control, operating problems persist and the financial position continues to deteriorate. Downwards risks to consensus estimates persist.
Gross spread is 0.33%. The estimated annual return is 1.63% (assuming settlement on 24 October). Sell on strength/tender during the offer in case there's a (low probability) improvement in the offer.


Siemens Energy/Siemens Gamesa: Downwards Guidance

<ul>
<li>Siemens Energy seems to have the backing of both BlackRock and Norges, and could then count on 72.55% of the votes vs. 75% approval at EGM needed for delisting.</li>
<li>The shares have seen high purchasing activity since the offer announcement (€158 million average turnover since Monday). Gross spread is 1.5%, 3.7% estimated annual return (assuming settlement on 24 October).</li>
<li>One could sell part of the shares if the share price rises above the offer price and await a possible sweetening, and tender the rest during the acceptance period.</li>
</ul>


Siemens Energy seems to have the backing of both BlackRock and Norges, and could then count on 72.55% of the votes vs. 75% approval at EGM needed for delisting.
The shares have seen high purchasing activity since the offer announcement (€158 million average turnover since Monday). Gross spread is 1.5%, 3.7% estimated annual return (assuming settlement on 24 October).
One could sell part of the shares if the share price rises above the offer price and await a possible sweetening, and tender the rest during the acceptance period.


<ul>
<li>Siemens Energy hasn't expected to its CMD and instead announced on Saturday late evening an <strong>€18.05/share</strong> voluntary cash tender offer for the remaining 32.9% of Siemens Gamesa it doesn't own.</li>
<li>The consideration represents a 27.7% premium and 23.1x EV/Fwd EBITDA. It seems fair and higher than that initially expected. Siemens Energy is likely to issue a convertible.</li>
<li>Upon market open on 23 May, expect the shares to close most of the gap with the offer price. Siemens Gamesa will likely exit the Ibex 35 in H2 2022.</li>
</ul>


Siemens Energy hasn't expected to its CMD and instead announced on Saturday late evening an €18.05/share voluntary cash tender offer for the remaining 32.9% of Siemens Gamesa it doesn't own.
The consideration represents a 27.7% premium and 23.1x EV/Fwd EBITDA. It seems fair and higher than that initially expected. Siemens Energy is likely to issue a convertible.
Upon market open on 23 May, expect the shares to close most of the gap with the offer price. Siemens Gamesa will likely exit the Ibex 35 in H2 2022.


<ul>
<li>Siemens Energy is considering a cash offer for the 32.9% of Siemens Gamesa it does not own. Group simplification and major restructuring would make sense.</li>
<li>Applying the 6-month VWAP rule, the offer price could reach c. <strong>€18.1/share</strong>. Takeover regulation says the offer must be in cash and the price equitable, allowing for other calculation methods.</li>
<li>Siemens Energy does not need to offer a high premium and could make an announcement on 24 May (CMD). Recommendation is long.</li>
</ul>


Siemens Energy is considering a cash offer for the 32.9% of Siemens Gamesa it does not own. Group simplification and major restructuring would make sense.
Applying the 6-month VWAP rule, the offer price could reach c. €18.1/share. Takeover regulation says the offer must be in cash and the price equitable, allowing for other calculation methods.
Siemens Energy does not need to offer a high premium and could make an announcement on 24 May (CMD). Recommendation is long.


Siemens Energy/Siemens Gamesa: Possible Delisting Offer

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>DAX is a German blue-chip index that tracks the 40 largest companies listed on the Regulated Market of the Frankfurt Stock Exchange. </li>
<li>The DAX Index is reviewed on a quarterly basis in March, June, September, and December. </li>
<li>In this insight, we take a look at the potential constituency changes for the June 2022 review. This is a follow-up insight to <a href="https://www.smartkarma.com/insights/dax-index-quiddity-leaderboard-for-june-2022" target="_blank" data-smartkarma-citation="insights:68078" rel="noopener">DAX Index: Quiddity Leaderboard for June 2022</a> </li>
</ul>


DAX is a German blue-chip index that tracks the 40 largest companies listed on the Regulated Market of the Frankfurt Stock Exchange. 
The DAX Index is reviewed on a quarterly basis in March, June, September, and December. 
In this insight, we take a look at the potential constituency changes for the June 2022 review. This is a follow-up insight to DAX Index: Quiddity Leaderboard for June 2022 


DAX Index: Quiddity Leaderboard for June 2022 (2.0): Rheinmetall Looks Interesting

Germany

Siemens Energy AG operates as a renewable energy company. The Company offers power generation and transmission, technical consultancy, and operation and maintenance services. Siemens Energy serves customers worldwide.

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Siemens Energy AG (ENR GR)

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