War on Cerved, here are the latest news
Several funds asked Cerved, an Italian group specializing in business information and credit management, to find alternative offers or to negotiate better terms of the tender offer with the consortium led by Ion and Fsi. Facts, numbers and tensions
The funds are holding back on the (unsolicited) takeover bid by Fsi and Ion Capital by Andrea Pignataro for Cerved (an Italian group specializing in business information and credit management).
As Repubblica reported yesterday , "the shareholder funds consider the 9.5 euros of the tender offer insufficient to represent the potential of the company that collects and sells the data of the Chambers of Commerce to banks and companies".
Several funds therefore asked Cerved, led by Andrea Mignanelli, to find alternative offers or to negotiate the best possible conditions with Ion and Fsi.
For Cerved, this is the second acquisition attempt in less than two years, after Advent International launched an offer in 2019 . Subsequently withdrew after the Italian group's share price had risen due to the rise in the market price.
A long preparatory board meeting was also held on Monday for the shareholders' meeting on April 27, which approved the financial statements at December 31, 2020.
As Bebeez pointed out , since Monday 19 April the group's prices on Piazza Affari have remained above the takeover bid price.
Today, at 1.30 pm, Cerved shares are trading up 0.16% to 9.65 euros, equal to a capitalization of 1.878 billion euros, against the equity value of 1.855 billion corresponding to the offer price.
All the details.
THE ROLE OF CEDACRI AND CERVED
Over the past few weeks, the Ion fund has orchestrated two significant transactions in Italy: it bought Cedadri and launched a takeover bid on Cerved .
Cedacri and Cerved are two nerve centers in the economic-industrial-financial data of Italian companies.
In fact, Cedacri is the Italian company specializing in IT outsourcing services for the banking sector and Cerved is the company that collects and processes data from the Chambers of Commerce.
THE OPA OF ION
On 9 March Castor srl, whose capital is owned by Ion Capital, launched a voluntary takeover bid on all Cerved Group ordinary shares.
The offer is approximately € 1.85 billion in cash.
The takeover bid aims at reaching 90% of the capital, among the conditions, for the delisting which, if not achieved, can be achieved through the merger of Cerved into the offeror or other unlisted company belonging to the group attributable to Andrea Pignataro.
WHO PROMOTES THE OFFER
Ion's offer was made through Castor srl, controlled by the Irish company Castor Bidco Holdings, in turn wholly owned by FermIon Investment Group, 85.75% owned by Ion Capital Partners and by Gic Private Limited, a fund sovereign investment fund founded by the Singapore government in 1981 for 10%. The remaining 4.25% is in the hands of institutional investors.
The Italian FSI fund led by Maurizio Tamagnini is also part of the binding offer.
THE PRICE OF THE OPA
Ion has therefore declared that it will pay 9.5 euros for each Cerved share. The price incorporates a premium of 43% compared to the average price in the 12 months prior to the announcement of the offer and 34.9% compared to the official share price as of March 5, 2021.
“The consideration – underlines Bebeez – has an implicit multiple of 2022 EV / ebitda of 10 times and a price / profit ratio of 15.6 times. This means that in the event of delivery of all the shares subject to the bid, the consortium of investors will have to put a total of 1.855 billion euros on the table ”.
THE ACTIVISM OF PIGNATARO
London-based Ion, led by Italian entrepreneur Andrea Pignataro , is a group that owns companies such as Dealogic, Acuris, owner of MergerMarket, and Fidessa, producer of trading software.
Also last month, Ion acquired the Cedacri group, an Italian supplier of banking software, together with Maurizio Tamagnini of Fsi, for 1.5 billion.
THE ACQUISITION OF CEDACRI
Fsi had in fact sold its 27% stake in Cedacri together with the other shareholder banks that held the remaining 73% of the capital to Ion di Pignataro itself.
THE COMPANY COMPANY OF CERVED
As regards Cerved, the company holds own shares for 1.53% of the capital while the main shareholders with more than 3% are Wellington Management Group with 5.077%; Massachusetts Financial Services Company with 4.182%; Kayne Anderson Rudnick Investment Management with 3.064%; the MutuiOnline group with 3.015% and Giancarlo Broggian (Servizi Cgn) with 3.006%.
THE FREE GO OF ANTITRUST
On March 25, the Offer Document was filed with Consob. On the same day, the Agcm also gave its clearance for the operation.
BUT THE FUNDS HOLD DOWN
However, there is a storm over Ion and Fsi's offer for Cerved.
“Several funds have asked Cerved – reported La Repubblica – to find alternative offers or to negotiate the best possible conditions with Ion and F2i”.
"Other foreign shareholders, or giants such as Amber Capital, Boussard & Gavaudan Partners, PSquared Asset Management and Tiedemann would have acquired important packages of Cerved on the stock exchange, often at prices higher than those of OPA (yesterday the share was worth € 9.6) , to block the offer of the Ion-F2i tandem. According to Boussard (rising to 5% last April 12) Cerved is worth much more: by removing the NPL activity – for which there was a negotiation of about 400 million with Centerbridge – the financial information group is evaluated by the current offer eleven times the gross operating margin, which is about half the multiple that rival companies such as Expernian and TransUnion treat. After all, since the takeover bid on Cerved was announced on 9 March, about 55% of the volumes traded have ended up in the hands of hedge funds ”.
SINCLAIR CAPITAL HAS ALREADY PULLED BACK
Already in mid-April Massimo Stabilini, founder of Sinclair Capital (an alternative investment company with over 100 million dollars in assets under management), at that time owner of a 1% stake in Cerved, had told Reuters that he would not have contributed its share package at the takeover bid precisely because the price was not adequate.
"We expect the board not to approve the offer," said Stabilini. "We think other players may show interest in the group," he added.
Stabilini said the price of Ion's offer with Fsi was too low, considering that Cerved's credit management division alone could be sold for 400-500 million euros.
According to the founder of Sinclair Capital, the price did not take into account potential efficiencies with Cedacri and the impact of the coronavirus pandemic on Cerved's share price over the past year.
THE MOVEMENTS ON THE CERVED SHARE
"Meanwhile, in recent days there have been several movements on the stock by Morgan Stanley and JP Morgan," said Bebeez . "In particular, in the latest Consob communication on relevant shareholders published on Friday 23 April, we read that JP Morgan fell to 3.874% from 5.169% on 20 April and exited the equity swap contracts it had in place for a potential stake equal to 0.02%; while Morgan Stanley on 19 April fell from 6.371% (of which 5.76% the potential participation from equity swap contracts) to 6.351% (of which 5.324% in equity swaps) ".
THE ASSEMBLY ON APRIL 27
Finally, yesterday the Cerved Group shareholders' meeting approved the financial statements as at 31 December 2020 and the proposal of the board of directors to cover the loss resulting from the 2020 financial statements, equal to 296,070 euros, through the use for equal amount of retained earnings reserves.
As expected, the shareholders' meeting did not approve the distribution of a dividend of 0.50 euro per share, proposed by the shareholders of the Mutuionline Group (3.3% of the share capital) and its subsidiary Centro Istruttorie.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/guerra-su-cerved-ecco-le-ultime-novita/ on Wed, 28 Apr 2021 12:54:15 +0000.