EMAK SpA – results of subscription rights exercise period published

Many thanks to Winter who linked in the AZ Forum to the results of the exercise period for the subscription rights.

In total almost 99% of the subscritption rights have been exercised.

During the subscription period, which began on 21 November 2011 and closed on 13 December 2011, 26,976,676 rights were exercised, corresponding to an aggregate of 134,883,380 Shares subscribed, equal to the 98.974% of the 136.281.335 Shares offered in the context of the Capital Increase, for a total amount of euro 57,325,436.50.

It looks like that my Paranoia Scenario was indeed only paranoia:

In accordance with the commitment undertaken on 5 August 2010, Yama S.p.A. has exercised all the rights to which it was entitled in the context of the Capital Increase and in relation to all Emak S.p.A. shares it owns (corresponding to the 74,285% of the share capital of Emak S.p.A. and to the 75,368% of the share capital excluding the treasury shares owned by Emak S.p.A.).

Consequently, Yama S.p.A. subscribed 102,712,500 Shares, for a total amount of euro 43,652,812.50.
Following the subscription of the Capital Increase, Yama S.p.A. will hold the 74.285% of the total share capital of Emak S.p.A. (corresponding to the 75.368% of the share capital excluding the treasury shares owned by Emak S.p.A.).

It looks like YAMA has exercised exactly the number of rights they got from their initial stake and they did not sell or buy any subscription on a net basis.

So for the moment it looks more like really bad execution than an evil genius trying to squeeze out the minority shareholders.


  • Hi mmi,
    Thanks for your feedback. Did checked their website again, somehow I missed this IR presentation. Everything in there, what I am looking for. I guess I understand your paranoia scenario a bit better now. It is really a little bit to good to be true.

  • peter,

    in their IR presentation they say that they want to pay out 40% of net income as dividend for 2012 and 2013.

    Bad execution: forme it is not clear why they have chosen this structure (deep discount,5 shares per subscription rights),normally one could do this differently.


  • Hi memyselfandi007
    One more thing, here the figures from 2010 which I used to show the situation for the new group. The interesting thing is that average EBITDA margin between EMAK and the rest is almost the same. Taking into account that ratio between EBITDA and net results is around 0.5 for EMAK in the past, there would be around €20m which is more than a fourth from the current market cap of ~€75.3m.

    Revenue EBITDA EBITDA margin
    Emak € 206,78 € 23,51 11,37%
    Comet Group € 51 € 5 9,80%
    Tecomec Group € 67 € 8 11,94%
    Sabart € 22 € 3 13,64%
    Raico € 10 € 0,90 9,00%
    Total (New group) € 356,78 € 40,41 11,33%

    All figures are from 2010 in million €

  • Hi memyselfandi007
    Really nice finding and great summaries in here. I reviewed all your excellent analysis on EMAK and I think it is an undervalued company. However, why do you think it is bad execution? I see a lot of benefits for the Yama Group, for example: They gain €58M this year and just paid ~ €44M and additionally, they get €24.7M over the next two years and still have full control over all the companies through EMAK. I think it also was a cheap way to not have an IPO for the other 4 companies. Would be great to hear your thoughts here.
    Currently I calculate a P/E ratio of around 4 which is really cheap, but I guess dividends will not be paid the next 2 years to pay back the remaining price to Yama. So, I guess my question is, what interest does Yama have to get the share price up back to let’s say 80-90 Cents per share.

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