European Event-Driven Analyst

Jesus Rodriguez Aguilar

Jesús is an Insight Provider (Event-driven) on the Smartkarma network, where he looks across sectors at opportunities arising from securities mispricing (both credit and equity), share classes, bid announcements, prospective bids, and special situations. He has served as Economic and Business Advisor at the Spanish Congress in Madrid. Prior to that, he has worked in the City of London: as a Credit Analyst at Bloomberg; Event-driven associate at former boutique European Research; and doubled as Special Situations and Equity-linked VP (convertible bonds) at Merrill Lynch. Jesús has an MBA from the London Business School, a BA (Hons.) degree in Economics from the Complutense University in Madrid, and a BA (Hons.) in Law from U.N.E.D., also in Madrid.

EQT/​Dechra Pharmaceuticals: Recommended Offer

Hellman & Friedman Matches EQT in Contest for Zooplus AG

Event-Driven

In my insight <a href="https://www.smartkarma.com/insights/hellman-friedman-matches-eqt-in-contest-for-zooplus-ag" target="_blank" data-smartkarma-citation="insights:58682" rel="noopener">Hellman &amp; Friedman Matches EQT in Contest for Zooplus AG</a>, I cautioned about the unfavorable risk/reward in the <a href="https://www.smartkarma.com/entities/zooplus-ag" target="_blank" data-smartkarma-citation="entities:21749:1" rel="noopener">zooplus AG (ZO1 GR)</a> bid battle, and mentioned that EQT should better its bid to reach its minimum acceptance condition (50% plus one share). I did not discard a further offer by EQT, but if that happened, it would be a small price increase.
On 25 October, <a href="https://investors.zooplus.com/en/press-release_zooplus-supports-increased-and-final-offer-of-eur-480-per-share-by-hf-in-partnership-with-eqt/" target="_blank" rel="noopener">H&amp;F informed zooplus AG</a> that an affiliate of Zorro Bidco S.à r.l., a holding company currently controlled by funds advised by H&amp;F, has purchased shares in zooplus at €480/share. This triggers an increase in the offer price. Moreover, both H&amp;F and EQT have partnered to acquire zooplus AG, thus putting an end to the takeover contest. The Management Board and the Supervisory Board of zooplus AG happily support this price increase: after several rounds, the increased consideration represents a 72% premium to the day prior to the first offer by H&amp;F, 85% premium to the 3-month VWAP.
The increased offer represents an implied equity value of €3,408 million and an implied EV of €3,334.4 million, and rather generous multiples: 1.4x EV/2022e Sales, 41.6x EV/2022e EBITDA and 119.1x P/2022e E.
The acceptance period will expire unchanged on 3 November, 24:00 hrs. CET. The minimum acceptance threshold is still 50% plus one share; and all prior irrevocable undertakings remain valid.
Results should be announced on 8 November, with the 22 November being the last possible date for acceptance of a successful takeover offer.
There isn't much to get from a 0.33% gross spread, unless there is a market slump. Almost €40 million worth of zooplus AG shares traded today. Tender.

In my insight Hellman &amp; Friedman Matches EQT in Contest for Zooplus AG, I cautioned about the unfavorable risk/reward in the zooplus AG (ZO1 GR) bid battle, and mentioned that EQT should better its bid to reach its minimum acceptance condition (50% plus one share). I did not discard a further offer by EQT, but if that happened, it would be a small price increase.
On 25 October, H&amp;F informed zooplus AG that an affiliate of Zorro Bidco S.à r.l., a holding company currently controlled by funds advised by H&amp;F, has purchased shares in zooplus at €480/share. This triggers an increase in the offer price. Moreover, both H&amp;F and EQT have partnered to acquire zooplus AG, thus putting an end to the takeover contest. The Management Board and the Supervisory Board of zooplus AG happily support this price increase: after several rounds, the increased consideration represents a 72% premium to the day prior to the first offer by H&amp;F, 85% premium to the 3-month VWAP.
The increased offer represents an implied equity value of €3,408 million and an implied EV of €3,334.4 million, and rather generous multiples: 1.4x EV/2022e Sales, 41.6x EV/2022e EBITDA and 119.1x P/2022e E.
The acceptance period will expire unchanged on 3 November, 24:00 hrs. CET. The minimum acceptance threshold is still 50% plus one share; and all prior irrevocable undertakings remain valid.
Results should be announced on 8 November, with the 22 November being the last possible date for acceptance of a successful takeover offer.
There isn't much to get from a 0.33% gross spread, unless there is a market slump. Almost €40 million worth of zooplus AG shares traded today. Tender.

zooplus AG

EQT and H&F Will Partner in Raised Offer