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bne October 2020 Companies & Markets I 25
BCS Global Markets on September 23 wrote that Yandex, as one of the leading IT players in Russia, is seen as "a very strong shareholder to support TCS’ future developments with best-in-class technology and strong customer base."
"The deal would create a player covering almost all the cus- tomers’ digital needs, would allow for a cross-sell into existing customer bases and would help offer more relevant products (based on combined customer knowledge," BCS Global Mar- kets commented.
Analysts at BCS GM believe the current management of TCS should see Yandex as a new shareholder as a positive. "Such a player, with its 80-90mn audience and advanced technologies, may indeed change the state of things in the financial sector," they wrote.
BCS GM estimated that the deal price of $27.64 per GDR of TCS makes a 8% premium to the closing price of September 21, 10.4% to one-month weighted-average and 16.9% to three-month weighted-average.
Equity funds acquire Hungary’s leading meat processor
IntelliNews Pro
Hungary’s leading turkey processor Gallicoop has been acquired by three private equity fund managers,
one of which is linked to Hungary’s most powerful oligarch, it was announced on September 11. The financial details of the transaction were not revealed.
The buyers were Hungary’s leading private equity funds, one of which is connected to Hungarian billionaire Lorinc Meszaros. Status Food Private Equity Fund has made several investments in Hungary’s food sector over the years.
Takarek private equity fund is a subsidiary of MTB MagyarTakarekszovetkezeti Bank, the central bank of the country’s savings’ cooperatives, while Beta is controlled by MKB, in which Meszaros has a minority stake. MKB and MTB are in talks of a merger with state-owned Budapest Bank to create the country’s second-largest lender by 2021.
Gallicoop was founded in 1989 by Hungarian entrepreneurs. Over the years it has become a leading meat processor in Hungary with a market capitalisation of HUF1.8 trillion (€5bn). The company generated HUF36.5bn in revenue in 2019,
up from HUF35bn a year earlier. Some 40% of the revenue
The share price of TSC has been on a rollercoaster ride in recent years. The company floated on the LSE at a price of $17.50 in October 2013 but the share price crashed to $1 the following year after Russia annexed the Crimea leading to international sanctions. Since then the shares have made a steady recovery. Yandex has a similar story. It floated
on Nasdaq in May 2011 raising $1.3bn from its IPO. Both companies are amongst the handful of Russian companies that have regained and exceeded their pre-Crimea share price valuations.
As for effects on Yandex, at the set price tag, the deal may be value-accretive, as TCS is a strong banking player, the deal is carried out at a moderate premium, with possibility for synergies, BCS GM notes.
On the flipside the analysts see credit risks, likely net debt and shareholder dilution through a share issue to finance the deal, as well as a risk of a higher price tag for Yandex.
came from exports. After-tax profit grew from HUF1.13bn to HUF2bn in 2019.
Gallicoop operates the country’s largest closed production integration system, as it controls the whole processing-chain from turkey rearing to finished product.
Last year the company processed 39,000 tons of turkeys and rolled out 8,000 tonnes of finished products.
The company has recently received a HUF282mn grant for the installation of solar panels at its base in Szarvas, southwest Hungary.
Gallicoop's board has appointed Andras Muzsek, the former head of sector peer Saga Food, the new CEO, who envisaged further expansion in foreign markets.
"With the right amount of capital, Gallicoop could become a force to be reckoned with on the Central and Eastern European food market," Muzsek said, adding that the integration of its more than 100 suppliers would be strengthened in the interest of expanding in the region while preserving is position on the domestic market.
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