Slovenian Weekly Report 11.6.2018-15.6.2018
GORENJE:
Panasonic Corporation, holding 10.7419% of Gorenje shares, also sold its entire position as they have accepted the takeover offer by Hisense. This was expected, namely that Panasonic will seek and accept an exit after it decided not to pursue strategic alliance with Gorenje in late 2016. Note that majority of their holding was gained in 2013 cap increase for EUR 4.31 per share.
In addition it was speculated whether state entity KAD d.d. will be able to accept the offer since states strategy classified Gorenje as important (therefore not meant for divestment). Nevertheless KAD supervisory board decided to accept the offer and sell its 16.4% stake to Hisense. This is a prudent decision given the situation.
On 14th June 2018 data showed Hisense already gained 32.96% stake.
With this 3 bullet points, Hisense already surpassed 50% of Gorenje ownership. We believe that takeover will be successful and completed at EUR 12 per share.
Since our last report indicated standalone valuation of EUR 5.8m (with hold rating attached and dated 11th May 2018) and since the takeover multiples (premium) deems generous we believe accepting the offer is prudent.
Therefore at price EUR 12 per share our recommendation is to sell the shares of Gorenje (accept the offer).
Gorenje dd is a Slovenia-based company engaged in the production and sale of household appliances. The Company operates through three business segments: Home, producing and selling products and services for home, such as major domestic appliances (MDA), small domestic appliances (SDA), heating, ventilation, air conditioning (HVAC) and kitchen furniture; Ecology, providing ecology-related services; and Other, with such activities as tool-making, engineering, hotels and hospitality services, trade, and design services. The Company covers the global markets with a portfolio of ten brands: Gorenje, Gorenje+, Korting, Sidex, Mora, Atag, Etna, Pelgrim, Asko and Upo. As of December 31, 2011, the Company was the parent company of the Gorenje Group, which consisted of numerous companies in such countries as Slovenia, Austria, Germany, Italy, France, Spain, the United Kingdom, Denmark, Sweden,, Norway, the Czech Republic, Slovakia, Hungary, Poland, Bulgaria and Croatia, among others.
ALTA Invest, investicijske storitve, d.d., (ALTA Invest, investment services, Inc.) is a part of ALTA Group, the biggest financial non-banking group in Slovenia. ALTA Invest has around 28% market share on the domestic Ljubljana Stock Exchange and has more than EUR 95m of assets under management.
Our trading advantage is our execution of large trading blocks with low impact on the market. We offer trading on several platforms on numerous markets, with a wide variety of financial instruments. Our advantage is also a research department, which is both sell side and buy side and has the far most extensive and regular coverage of domestic companies. We cover 9 companies on Ljubljana Stock Exchange, which is around 90% of Mcap on LJSE – and here we are practically the only local broker providing this kind of extensive and regular coverage for Slovenian companies.
A part of ALTA Group are ALTA Skladi, a mutual fund asset management company with roughly EUR 260m of asset under management. ALTA Group is also extensively involved in corporate finance projects and raised considerable assets (fixed income and equity) in the last two years for several companies.
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