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INDRA: HENSOLDT COULD SELL 25.1% OF SHARE CAPITAL (ANÁLISIS BANCO SABADELL)

According to Bloomberg, Hensoldt (German defense company) would have confirmed it is in talks to sell a 25.1% stake (held by funds advised by KKR) with interested parties including IDR, Leonardo, Saab and Thales.
MARKET IMPACT
IDR has confirmed it is analyzing the deal and has not made public any details. Accordint to our estiamtes, the acquisition of 25.1% (€~1.6 Bn market cap) would mean € 397 M for IDR (~30% IDR’s market cap), leaving the NFD/EBITDA’21e ratio at 2.9x (vs. 1.6x currently and 2.5x in 2020). Helsoldt is trading at 15x EV/EBIT’21 (vs. IDR’s 8.7x) with an EBIT margin of around 10% (vs. IDR’s 6.6% in 2021). Although these businesses complement each other (Hensoldt produces defence electronics and is also involved in FCAS), we believe that keeping a minority stake might not be sufficient (to create more synergies and consolidate the asset), and thus, we would still have to know the company’s final intentions. We recall that KKR recently sold another 25.1% share package to the German Govt., the valuation of which was not made public but which we estimate at similar levels to the current ones.