Metlen Energy & Metals — Sights set for London and €2bn/year EBITDA

At its recent capital markets day (CMD), Metlen confirmed its preparations for a London Stock Exchange listing and unveiled a new medium-term target to reach EBITDA of €2bn per year through a range of new organic business initiatives. In this note we update our numbers, incorporating some of these growth plans, which, along with some other updates, results in an uplift in our valuation from €49/share to €60/share, driven primarily by a rise in our DCF valuation to €66/share to reflect long-run growth options. Metlen is an energy (renewables, natural gas utility and regional electricity) and metals (bauxite, alumina, aluminium and planned gallium) business, with strong synergies across these activities. It is positioning itself in growth markets and, in our view, will be a unique and attractive new stock when it lists on the London Main Market.