Category Archives: Uncategorized

Special situation quickie: Osram take-over at EUR 35 /share

This will be a very short one:

Bain Capital and Carlyle want to take over Osram at 35 EUR per share. The offer is friendly as Managment and Supervisory board have agreed to the takeover.

The offer runs until beginning of September and minimum acceptance level is 70%.

There is no detailed offer document out now yet.

Nevertheless I established a 2,5% position at ~33.1 EUR, providing a 5,7% potential return.

Major risk is in my opinion politics (loss of jobs), chances to the upside could come form activists pushing for a higher price. In the meantime there could be clearly hick-ups (not reaching the 70% because of activist involvement) but Bain and Carlyle are pros.

The buyers are top tier PEs who execute this kind of offers well and have the money.

For those investors who remember: I looked at the Osram spin-off 6 years ago, but then failed to buy the stock because my limit was a few cents too low. So I know the company relatively well. This doesn’t of course guarantee any success ……

Update Handelsbanken – HOLD

Handelsbanken Update:

2018 was on the surface a solid year for Handelsbanken. According to the 2018 annual report, operating profit increased by +5% and net income by +8%, top line by +5%. ROE was 12,8% which is below my assumed 15% but still a remarkably good number for a large bank.

Just looking at the bottom line, the first quarter of Handelsbanken looks great:  Net income up +19%, operating profit up +18%. However top line only grew at +4% (vs. Q1 2018).

However this is solely a function of the fact that the bank reversed their provision into the Oktogonen pension fund for employees which they clearly state in the quarterly report:

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Deutsche Familienversicherung AG: Europe’s leading Insurtech or “Lipstick” on an ordinary Insurance company ?

Deutsche Familenversicherung AG (DFV) IPOed end of last year and claims to be the first stock listed “Insuretech” in Europe. The IPO was only successful at the second attempt but still they made it. In their investor presentation they even call themselves “Europe’s leading Insurtech” which is a pretty bold claim.

Excursion: What does Insurtech /Fintech mean ? And what does digital mean ?

There is clearly not general valid definition of Fintech /insurtech, but looking at the Fintech space, one would characterize these companies as technology driven companies that use technology to do things faster, cheaper and better than thier “ordinary” competitors.

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Special situation: Innogy Tendered Shares (IGYB) -(very) Cheap Optionality ?

Background:
The guys from Paladin AM have outlined the Innogy case very nicely on their blog (in German): Intro & Update

I’ll try to summarize it in my own words:

Innogy, the renewable energy spin-off of RWE is in the process of being taken over by competitor E.ON. E.ON in 2018 had announced to purchase the 77% stake of RWE and has offered on a voluntary basis 36.74 EUR per share which, plus the upcoming dividend adds up to a total consideration of 38,14 EUR per share before tax. The closing of the transaction is subject to a relatively complex regulatory approval process which is already facing some delays. Most experts however think that the transaction will be ultimately approved.

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Performance review Q1 2019

In the first Quarter 2019, the Value & Opportunity portfolio gained 8,3% (including dividends, no taxes) against 11.9% for the Benchmark (Eurostoxx50 (Perf.Ind) (25%), Eurostoxx small 200 (25%), DAX (30%), MDAX (20%)).

Links to previous Performance reviews can be found on the Performance Page of the blog.

Some other funds that I follow have performed as follows in Q1 2019:

Partners Fund TGV: 10.63% *

Profitlich/Schmidlin: +8,45%
Squad European Convictions +6,44%
Ennismore European Smaller Cos +6.09% (in EUR)
Frankfurter Aktienfonds für Stiftungen +0,37%
Evermore Global Value  +6,54% (USD)
Greiff Special Situation +2,56%
Squad Aguja Special Situation +6,56%

*Since inception (01.01.2011), this translates into +173,2% vs. 86,4%  for the Benchmark.

Q1 2019 transactions

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Some links

An interesting collection of investment ideas are “SumZero’s top stocks for 2019”

Seth Klarman these days is concerned about capitalism as such

It’s maybe a good idea to stay away from industries where everyone seems to be a winner

The Bank of the bAnks (BIS) surprisingly doesn’t think that Proof-ofWork Cryptocurrencies like Bitcoin will work in the long run.

Elliott has released a plan how to make EBAY “great again”….

Forager likes Fast Fashion Retailer Glasson

A great collection of Q4 2018 fund letters 

Some links

Farnam Street on how not to be stupid plus its 2018 review

And ValueInvestingWorld with a fitting “final checklist” before making an investment decision

An interesting view on how “factors” like size, EV/EBIT etc. performed in 2018

Honeywell looks potentially interesting after the spin-off as well as ARLO

Good feature on Paul Singer (Elliott)

Four blogs with totally “off the beaten track” portfolios have posted 2018 reviews:
– GlobalStockPicking
– Alpha Vulture
– Value Investing France
– Clark Street Value

David Einhorn had a catastrophic year in 2018

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