{"id":341,"date":"2022-02-07T01:00:00","date_gmt":"2022-02-07T01:00:00","guid":{"rendered":"https:\/\/bluegemresearch.co.za\/?p=341"},"modified":"2022-02-06T08:29:24","modified_gmt":"2022-02-06T08:29:24","slug":"arb-holdings-offer-to-minorities-proposed-delisting","status":"publish","type":"post","link":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/?p=341","title":{"rendered":"ARB Holdings \u2013 Offer to Minorities &#038; Proposed Delisting"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><strong>Share Code: ARH \u2013 Market Cap: R1.8bn \u2013 PE: 9.3x \u2013 DY: 4.3%<\/strong><\/p>\n\n\n\n<div class=\"wp-block-file\"><a id=\"wp-block-file--media-9aaca8d5-b544-4539-bd52-c5228db3956e\" href=\"http:\/\/v5j22kvl0zh.c.updraftclone.com\/wp-content\/uploads\/2022\/02\/ARB-Holdings_Ad-Hoc-Note_7-Feb-2022.pdf\">ARB Holdings &#8211; Ad-Hoc Note<\/a><a href=\"http:\/\/v5j22kvl0zh.c.updraftclone.com\/wp-content\/uploads\/2022\/02\/ARB-Holdings_Ad-Hoc-Note_7-Feb-2022.pdf\" class=\"wp-block-file__button\" download aria-describedby=\"wp-block-file--media-9aaca8d5-b544-4539-bd52-c5228db3956e\">Download<\/a><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Offer to Minorities &amp; Proposed Delisting<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>A company owned by <a href=\"https:\/\/masimong.com\/\">Masimong<\/a> (50.1%-shareholding) and <a href=\"https:\/\/www.sabvestcapital.com\/\">Sabvest<\/a> (49.9%) has made an offer to minority shareholders (other than the Burke Family that collectively holds 62.9% of ARB\u2019s shares) to acquire their shares for cash of 800cps.<\/li><li>If the scheme is approved by shareholders (75% vote is required) &amp; goes ahead, ARB will also be delisted from the JSE.<\/li><li>Besides the usual conditions\/clauses &amp; the approvals needed, the scheme currently has irrevocable support of 69.41% of shareholders (that can vote at the scheme meeting, i.e. \u201cdisinterested shareholders\u201d) and, thus, we view it as highly-likely that this transaction successfully conclude.<\/li><li>See the full announcement here: <a href=\"https:\/\/www.sharedata.co.za\/sens.asp?id=407622\">LINK<\/a>.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Previously Published Valuation: Justifies Offer Price<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"https:\/\/v5j22kvl0zh.c.updraftclone.com\/?p=311\">In our previously published FY 21 results piece<\/a>, we saw fair value as 654cps on a Price Earnings (PE) of c.7.9x, which is hardly demanding given the quality of the underlying businesses and did imply some upside risk to this view.<\/li><li>Our EV\/EBITDA-implied fair value of 740cps adds weight to this view of fair value and its upside risk.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Our Thoughts: Fair Premium &amp; Well-supported Offer<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Given our view of ARB\u2019s fair value, the 800cps offer price for minorities comes in at a c.22% <em>premium<\/em> to this (not counting the even <em>larger<\/em> premium against the pre-offer share price).<\/li><li>The offer is pricing a material minority stake. The Burke family will <em>remain<\/em> in control post-delisting and, thus, this offer should not include a classical \u201ccontrol premium\u201d as control is not, in fact, being acquired. Thus, we consider this offer price to be quite fair and, likely, attractive to minorities.<\/li><li>This view is backed up by the large number of irrevocables secured (including institutional investors and former insiders). These irrevocables (totalling c.69.41% of shares able to vote on this deal) furthermore imply the likelihood of this deal successfully concluding as quite probable.<\/li><\/ul>\n\n\n\n<div class=\"wp-block-file\"><a id=\"wp-block-file--media-8ee5f2ea-dcf6-4790-8fc7-e7b9edb26f02\" href=\"http:\/\/v5j22kvl0zh.c.updraftclone.com\/wp-content\/uploads\/2022\/02\/ARB-Holdings_Ad-Hoc-Note_7-Feb-2022.pdf\">ARB Holdings &#8211; Ad-Hoc Note<\/a><a href=\"http:\/\/v5j22kvl0zh.c.updraftclone.com\/wp-content\/uploads\/2022\/02\/ARB-Holdings_Ad-Hoc-Note_7-Feb-2022.pdf\" class=\"wp-block-file__button\" download aria-describedby=\"wp-block-file--media-8ee5f2ea-dcf6-4790-8fc7-e7b9edb26f02\">Download<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Share Code: ARH \u2013 Market Cap: R1.8bn \u2013 PE: 9.3x \u2013 DY: 4.3% Offer to Minorities &amp; Proposed Delisting A company owned by Masimong (50.1%-shareholding) and Sabvest (49.9%) has made an offer to minority shareholders (other than the Burke Family that collectively holds 62.9% of ARB\u2019s shares) to acquire their shares for cash of 800cps. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[50],"tags":[52,51,53,75,13,15,60,20,30,16],"class_list":["post-341","post","type-post","status-publish","format-standard","hentry","category-arb-holdings-arh","tag-arb","tag-arb-holdings","tag-arh","tag-electrical","tag-equity-research","tag-jse","tag-research","tag-small-cap","tag-small-caps","tag-south-africa"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=\/wp\/v2\/posts\/341","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=341"}],"version-history":[{"count":1,"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=\/wp\/v2\/posts\/341\/revisions"}],"predecessor-version":[{"id":344,"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=\/wp\/v2\/posts\/341\/revisions\/344"}],"wp:attachment":[{"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=341"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=341"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/v5j22kvl0zh.c.updraftclone.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=341"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}