Special Situation “quicky” – KAS Bank (ISIN: NL0000362648) take-over

DISCLAIMER: This is not investment advice. Please do you own research !!!!!

Background:

Some readers of my blog might remember KAS Bank. I bought the stock in August 2012 and then sold it with a decent profit in MArch 2015 because I had not paid attention to the pension liabilities.

Looking at the stock chart, the decision to sell in 2015 was a good (and lucky) one:

kas bank 5y

The take over bid

The stock did little for more than 3 years and then dropped like a stone in 2018. KAS Bank had been losing clients to larger competitors before finally a few days ago , Credit Agricol’s custody subsidiary CACEIS made a bid at 12,75 EUR per share.

As the bid price was more than 100% above the last price, it is no surprise that both, the management and board of KAS bank supported the offer.

The transaction is supposed to close in the third quarter and is subject to final regulatory approval,

Personally, I see very little risk of the transaction not going through, I consider this as a done deal. The Dutch authorities will not block this, the price looks fair and CA clearly has the funds to execute.

After the announcement, the stock now settled at 12,30 EUR, leaving a updside of 45 cents or 3,67% for a time period of ~6-7 months.

For me this is an interesting opportunity to park some cash at a decent annualized interest rate.

One question might be is why the spread is so high. I think this is the result of the high premium paid bei CA, There is clearly always a risk that for some reason a deal fails. For my personal risk appetite I am however prepared to take this risk and therefore I allocate 5% of the portfolio into this special situation.

P.S.: Thanks to the friendly reader who mentioned this to me !!!!

 

 

 

10 comments

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.