Una de Cal y otra de arena: Updated Believe SA y High Arctic Energy Services (English at the end)
“No te apures, que Dios aprieta, pero no ahoga, y aquí estoy yo para que no ayunes más de la cuenta, que el cielo bien ganado te lo tienes ya”. Benito Pérez Galdós.
En el mismo día hemos recibido dos noticias para dos de nuestras ideas, una de carácter agradable (ha subido un 15%) y otra que nos ha enseñado a no olvidar que no debemos perder jamás la humildad ( ha caído un 9%).
Believe SA
Empezando por el revés: Warner ha decidido no presentar una oferta por Believe SA.
Adjuntamos el link con la idea de inversión para poner en situación al que la desconozca:
La semana pasada “denunciábamos”, lo que nos parecía un golpe, al notificar el fundador y un grupo de accionistas relevantes, la intención de realizar una OPA por 15€, un 25% por debajo del precio de la salida a bolsa en 2021.
Esta historia nos parecía que podía tener un final feliz de la mano de Warner, que habría sugerido la posibilidad lanzar una contraoferta en 17€, y que ha acabado por retirar, posiblemente como se puede leer en medios, por algunas presiones de ciertas asociaciones de artistas, que no estarían de acuerdo con esta operación.
A partir de ahora, es justo asumir la pérdida del -5%, sobre el precio anterior al momento de la publicación de la idea en 15.7€, frente al cierre de hoy, en torno a 14.98€.
La situación ahora se complica. Lo previsible es que el consorcio intente finalmente cerrar la Opa a un precio de 15€. Faltaría como tramité formal, una valoración de un experto independiente, que el comité adhoc tendría que analizar.
No somos muy optimistas con la valoración, ya saben el Excel lo soporta todo…para arriba y para abajo.
La única esperanza recaería en los minoritarios y en los fondos díscolos para impedir que alcancen un porcentaje mayor al 90% y pueda arrastrar al resto en una exclusión. Lo que sabemos es que ellos controlan el 72%, y necesitarían al menos convencer a un 18% adicional. De no ser así, se verían obligados a subir el precio de la Opa para convencer a los inversores que no venden.
No obstante, reconocemos que esto es un tiro más complicado que el que se había planteado de inicio y que habría la posibilidad (extraña) de que incluso el consorcio no plantease una Opa, donde la acción debería volver al precio anterior a esta historia. Posiblemente sea la mejor solución a medio plazo, pero se sale del objeto de este substack.
High Arctic Energy Services
Hoy ha presentado resultados y con ellos actualizaciones sobre la situación especial que comentamos en su momento en la tesis inicial y en las dos siguientes entradas:
https://cocoabeanspodcast.substack.com/p/high-arctic-energy-services
https://cocoabeanspodcast.substack.com/p/high-arctic-energy-services-hagan
https://cocoabeanspodcast.substack.com/p/high-arctic-energy-services-sol-de
Hemos de reconocer que no teníamos claro si el management de esta compañía era de tipo “pirata” o simplemente unos incompetentes. Al parecer podrían ser de lo segundo, por lo que es posible que la tesis esté intacta.
Recapitulando brevemente, nos interesamos por esta compañía porque iba a realizar una fuerte distribución de la caja de forma fiscalmente eficiente e iba a emprender un Spin off de su negocio de Papúa Nueva Guinea, posiblemente muy infravalorado.
En cifras, por aquel entonces:
La empresa valía CAD 65M$, tenía una Caja neta de CAD 42M$ y pretendía repartir de forma inminente CAD 38M$. Además, quería realizar un Spin off del negocio internacional que podía valer entre CAD 50M$ – 100M$.
Es decir, valía CAD 1.35$/acc y se podría recibir al menos CAD 2$/acc, valorando el Spin off en el rango bajo.
¿ Que pasó por el camino?
Varias idas y venidas por parte del management y la intención de realizar el Spin off de forma privada y sin listar en mercado, lo que habría sido un acto de auténtica piratería. Además, de un sinfín de retrasos en la publicación de cuentas y de la publicación de notas, que animaban cuanto menos a la venta de la acción.
Tras varias cartas de accionistas relevantes denunciando la situación, y tras el asesoramiento de DLA Piper, parece que se van a hacer las cosas bien: van a proceder a realizar un Spin off listado públicamente en Canadá. Lo que mejora bastante nuestra tesis inicial.
Hoy en día y previo a la subida del 15% posterior a la noticia, la compañía capitalizaba CAD 50M$, ha cerrado el año 2023 con CAD 47M$ de caja neta y un working capital de CAD 62M$.
Según lo comentado, los planes siguen en pie:
“The Corporation provided an update today on the intention to issue shareholders a tax efficient return of capital to a maximum of $38.2 million and plan to reorganize the Corporation at a special meeting of the Shareholders. The recommendation to reorganize is expected to include the following elements:
· A spinoff of the international business to shareholders as a Canadian publicly listed company,
· Maintaining the Corporation as a Canadian publicly listed company focused on growing the Canadian business,
· Distribution of a return of capital to shareholders of between $33.0 million and $38.2 million before July 26, 2024, and
· Right-sizing the general and administrative infrastructure to align with the new corporate structure”
Lo que significa que hoy puedes comprar acciones por CAD 1.24$ y que tienen intención de repartir en julio entre un rango de CAD 33M$ y CAD 38M$, es decir, CAD 0.68$/acc-0.78$/acc.
Adicionalmente, estaría el spin off del negocio de plataformas de Rig en PNG. Nosotros en su día, indicamos que mínimo valdría CAD 1$/acc, pero que cada uno se haga sus números, solo podemos decir que habría hecho CAD 11M$ de beneficio operativo en 2023 y lo mejor estar por llegar a partir de 2025.
Y además quedaría un remanente de los negocios en Canadá, con alguna que otra adquisición reciente y más de CAD 100M$ en créditos fiscales.
Life is full of ups and downs: Updated Believe SA and High Arctic Energy Services
"Take it easy, for God tightens, but doesn't strangle, and here I am so you don't fast more than necessary, because you've earned your well-deserved sky." Benito Pérez Galdós.
On the same day, we received two pieces of news about two of our ideas, one pleasant (it has risen by 15%) and another reminding us never to forget humility (it has fallen by 9%).
Believe SA
Starting with the setback: Warner has decided not to submit an offer for Believe SA.
We attach the link with the investment idea to give context to those who are unfamiliar with it:
Last week, we 'denounced' what seemed like a blow, as the founder and a group of significant shareholders notified their intention to make a takeover bid at €15, 25% below the IPO price in 2021.
We thought this story could have a happy ending with Warner, which had suggested the possibility of launching a counteroffer at €17 but ultimately withdrew, possibly due to pressure from certain artist associations who disagreed with the deal.
From now on, we must accept a 5% loss from the previous price at the time of the idea's publication at €15.7, compared to today's closing price of around €14.98.
The situation now becomes more complicated. It's likely that the consortium will attempt to close the takeover bid at a price of €15. Formal procedures would include an evaluation by an independent expert, which the ad hoc committee would have to analyze.
We're not very optimistic about the valuation, as you know, Excel supports everything... both upwards and downwards.
The only hope lies with minority shareholders and dissenting funds to prevent the consortium from reaching a stake greater than 90% and dragging the rest into an exclusion. We know they control 72% and would need to convince at least an additional 18%. If not, they would be forced to raise the bid price to convince investors not to sell.
However, we acknowledge that this is a more complicated scenario than initially thought, and there is a (rare) possibility that the consortium may not even propose a bid, in which case the stock would return to its price prior to this story. This may be the best medium-term solution, but it goes beyond the scope of this substack.
High Arctic Energy Services
Today they presented results, along with updates on the special situation we discussed previously in the initial thesis and the two subsequent entries:
https://cocoabeanspodcast.substack.com/p/high-arctic-energy-services
https://cocoabeanspodcast.substack.com/p/high-arctic-energy-services-hagan
https://cocoabeanspodcast.substack.com/p/high-arctic-energy-services-sol-de
We must admit that we weren't sure if the management of this company was 'pirate' type or simply incompetent. It seems they might lean towards the latter, so the thesis could still be intact.
Recapping briefly, we became interested in this company because it was planning a significant cash distribution in a tax-efficient manner and was going to embark on a spin-off of its Papua New Guinea business, possibly highly undervalued.
At that time, in numbers:
The company was valued at CAD 65M, had a net cash position of CAD 42M, and intended to distribute CAD 38M imminently. Additionally, it aimed to spin off the international business, which could be worth between CAD 50M - 100M.
In other words, it was valued at CAD 1.35 per share and could potentially yield at least CAD 2 per share, valuing the spin-off at the lower end of the range.
What happened along the way?
Thera were several ups and downs from management and the intention to carry out the spin-off privately and without listing on the market, which would have been an act of genuine piracy. Additionally, there were numerous delays in the publication of accounts and notes, which at the very least encouraged selling the stock.
After several letters from significant shareholders denouncing the situation, and with the advice of DLA Piper, it seems they are going to do things properly: they are going to proceed with a publicly listed spin-off in Canada. This significantly improves our initial thesis.
Today, prior to the 15% increase following the news, the company had a market capitalization of CAD 50M, closed the year 2023 with CAD 47M in net cash, and a working capital of CAD 62M.
As mentioned, the plans are still on track:
"The Corporation provided an update today on the intention to issue shareholders a tax-efficient return of capital to a maximum of $38.2 million and plan to reorganize the Corporation at a special meeting of the Shareholders. The recommendation to reorganize is expected to include the following elements:
· A spinoff of the international business to shareholders as a Canadian publicly listed company,
· Maintaining the Corporation as a Canadian publicly listed company focused on growing the Canadian business,
· Distribution of a return of capital to shareholders of between $33.0 million and $38.2 million before July 26, 2024, and
· Right-sizing the general and administrative infrastructure to align with the new corporate structure."
This means that today you can buy shares for CAD 1.24 and they intend to distribute between a range of CAD 33M to CAD 38M in July, which is CAD 0.68 per share to CAD 0.78 per share.
Additionally, there is the spin-off of the Rig platform business in PNG. We previously indicated that it would be worth at least CAD 1 per share, but everyone should do their own calculations. We can only say that it generated CAD 11M in operating profit in 2023, and the best is yet to come from 2025 onwards.
Furthermore, there would be a remainder of the businesses in Canada, with some recent acquisitions and over CAD 100M in tax credits.