In today’s briefing:
- StubWorld: On Valuing Toyota Industries (6201)’s Stub Ops
- [Alert] Buy Lionsgate Entertainment
- Analyzing Active Quick Pitches: Takeovers, Tender Offers, Strategic Reviews and More
- KRON Acquisition by Kevin Tang: Analyzing the CVR Structure and Potential Shareholder Value Outcomes
- Strategic Reviews, Company Sales, and Litigation: Analyzing Active Portfolio Ideas
- Weekly Financial Insights: KRON Buyout, SAGE Earnings, BOOM Performance and More
StubWorld: On Valuing Toyota Industries (6201)’s Stub Ops
- Yes, I agree with Travis Lundy that the ¥6tn headline price tag for Toyota Industries (6201 JP) backs out a ~6x forward EBITDA for the unlisted stub ops.
- Preceding my comments on the Toyota Group are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
[Alert] Buy Lionsgate Entertainment
On a sum-of-the-parts basis, LION and STRZ are worth significantly more than is reflected in LGF.A’s stock price.
At the close today, investors could buy 1 share of Lionsgate Entertainment (LGF.A) for $8.90. On May 6, that investor will receive 1.12 shares of LION and 1.12 shares of STRZ.
I estimate LION is worth $11 and STRZ is worth $1.71. As such, it looks like there is ~60% upside
Analyzing Active Quick Pitches: Takeovers, Tender Offers, Strategic Reviews and More
- Theratechnologies (THTX) received takeover offers from Future Pak, with a $3.51/share cash offer plus a CVR worth $0.99/share.
- Naturgy Energy Group (NTGY:MC) plans to repurchase 9% of shares at €26.5/share, with priority for tenders below 375 shares.
- Lensar (LNSR) is being acquired by Alcon for $14/share cash plus a CVR worth up to $2.75/share.
KRON Acquisition by Kevin Tang: Analyzing the CVR Structure and Potential Shareholder Value Outcomes
- KRON is being acquired at $0.57/share plus a CVR, below expected net cash of $1/share.
- The CVR includes four components, with the “Additional Closing Net Cash” being the primary potential value source.
- Management’s 27% ownership suggests deal approval, despite potential risks and uncertainties in CVR payout assumptions.
Strategic Reviews, Company Sales, and Litigation: Analyzing Active Portfolio Ideas
- Lifeway Foods is likely to be sold to Danone, with a potential 14%+ upside, following board changes.
- Sage Therapeutics rejected Biogen’s offer, initiating a strategic review, indicating potential for a higher acquisition premium.
- Liquidia’s patent lawsuit win enables drug commercialization, expected to gain market share and significantly increase valuation.
Weekly Financial Insights: KRON Buyout, SAGE Earnings, BOOM Performance and More
- Kronos Bio (KRON) signed an acquisition agreement at $0.57/share plus a CVR, below expected net cash value.
- Sage Therapeutics (SAGE) reported Q1 revenue growth, ongoing strategic review, and management urged to cut costs or sell.
- DMC Global (BOOM) exceeded Q1 guidance but faces uncertain outlook due to tariffs and demand destruction.
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