Morningstar - Tatts Group Limited New Bidder Emerges for Tatts Group; Fair Value Estimate Unchanged

Report

Morningstar

Ravi Reddy

EUR 147.86 For Business Accounts Only

New Bidder Emerges for Tatts Group; Fair Value Estimate Unchanged

Our AUD 4.40 fair value estimate for narrow-moat Tatts Group is unchanged, following the indicative and nonbinding proposal from a consortium of investors to acquire 100% of Tatts for a combination of cash and scrip.
The new offer from Pacific Consortium values Tatts at between AUD 4.40 and AUD 5.00 per share, composed of AUD 3.40 per share in cash for the lottery business and one share in the wagering and gaming business, valued by the bidders at between AUD 1.00 and AUD 1.60 per share. The pr...

13/12/2016 14 EN

Underlying

Tatts Group Limited

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AU000000TTS5 Australia

Provider

Morningstar

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.

Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.

We have operations in 27 countries.

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Analysts

Ravi Reddy

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Tatts is off to a strong start to fiscal 2018 with first-quarter revenue and EBITDA increasing by 7% and 10%, respectively. The lotteries division was the key driver of the improvement, despite cycling against a weak comparable. Despite tracking marginally ahead of our expectations, the impact on our intrinsic value is negligible. We maintain our Tatts and Tabcorp fair value estimates of AUD 3.80 and AUD 4.20 per share, respectively. At current prices, we believe shares in both companies are sli...

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Corporate Action: Tatts Shareholders Should Vote in Favour of Merger with Tabcorp

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Another Spanner Thrown in the Works for Merger Between Tabcorp and Tatts

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New Bidder Emerges for Tatts Group; Fair Value Estimate Unchanged

Tatts Delivers a Solid Start to Fiscal 2018, Albeit Cycling Against a Weak Comparable

Corporate Action: Tatts Shareholders Should Vote in Favour of Merger with Tabcorp

Another Spanner Thrown in the Works for Merger Between Tabcorp and Tatts

Business as Usual for No-Moat Lonza; Specialty Ingredients Carve-Out on Track for 2020

Astra Posts Solid 2Q, Driven by Strong Cancer Drug Sales and Moving Away From One-Time Divestments

Astra Posts Solid 2Q, Driven by Strong Cancer Drug Sales and Moving Away From One-Time Divestments

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