idontwanttolose
14 Jun 2016
Swiss-based Daetwyler Holding AG has agreed to bu Swiss-based Daetwyler Holding AG has agreed to buy London-listed electronic component distributor Premier Farnell for 165p per share in cash.The price represents a premium of around 51% to Premier’s closing price on Monday and gives an enterprise value of £792m.“Datwyler believes the combination of Datwyler and Premier Farnell represents a strong strategic fit and is highly attractive,” Premier said in a statement.“The transaction creates a leading high service electronic components distributor in Europe and the combined platform will enable the combined group to realise significant economies of scale compared to Daetwyler’s standalone strategy, particularly in the context of a large addressable and fragmented high-service electronic components sector worth approximately CHF30-40bn, in which the top five distributors have a sector share of little over 15%.”RBC Capital Markets said: “Given the history, management changes, gross margin pressures, and the cycle - we see this as a good price. However, we would note the valuation is below that of key peer Electrocomponents (16E PE 20x, EV/EBITDA 16x).”Meanwhile, Peel Hunt said it reckons shareholders will approve the deal and on this basis, the brokerage upped its price target on the stock to 165p from 135p, maintaining its ‘buy’ rating.
idontwanttolose
14 Jun 2016
Offer is 165p per share
Eagerbeaver66
14 Jun 2016
Re: 160p offer rumour... I cant see any RNS out yet, but I just heard an announcement on Bloomberg TV that a Swiss company is putting forward a bid in the 160's for them today, - so perhaps that old rumour wasn't so far out!Let's hope for a bidding war!
gamesinvestor
05 Apr 2016
Electrocomponents Electrocomponents rallied as Numis upgraded its price target to 295p from 275p and reiterated its ‘buy’ rating on Monday following a trading update.The company said it expected full year profits to hit the top end of market expectations after a solid fourth quarter in which the UK recovery gained pace.Encouragingly, third-quarter declines in North America eased off and continental Europe remained on the charge to counterbalance Asian declines and enable 2% growth in group fourth quarter sales and 3% for the full year.The FTSE 250 company said the final quarter had seen further stabilisation in the gross margin, with the year-on-year decline reducing to 0.4% points, having been down 1.7% points in the first half of the year. This means, management said, that full-year gross margin should be down around one percentage point on the previous year.“Management's pre-close trading update indicates that the full year 2016 pre-tax profit out-turn will be around the top of the consensus range, which we attribute to a combination of a strong fourth quarter sales per day (SPD) performance, currency, and having delivered ‘at least’ £6m of cost savings in the year to March 2016.“We have upgraded our 2016-18 forecasts by around 2-3%, and our price target to 295p (previously 275p).”However, given the macro-economic uncertainty, Numis left its SPD growth assumptions broadly unchanged.
IB Investor
17 Mar 2016
Re: Results the sale completed yesterday? so the money will not be in the accounts - results disappointing - two key economies growing but profits down th
Hydrogen Economy
17 Mar 2016
Re: Results GamesI think Omaha man is right here, the results are to 31st Jan so completion and payment is into 2016.Overall I feel results are a little disappointing, the adjusted PE around 14 reported, nearer 20, the adjustment including re-organization costs in 2015 so hopefully positive impact in 2016.Final div and FY yield over 5% is reasonable - needs some improvement to be sustained.On balance I think market response is for once about right.H2
nk1999
17 Mar 2016
Re: Results I think Omaha is right. Read the last paragraph:"Net debtNet financial liabilities (including preference shares) for total operations decreased to £243.3m from £256.6m at the end of the prior financial year. Net financial liabilities fell in the year due to the cash generated from working capital actions undertaken as noted above. This was offset by an increase of £8.7m, due to the impact of exchange rates principally in relation to our US$ denominated private placement notes, and other non-cash movements of £3.9m.Net cash proceeds arising from the disposal of Akron Brass will be used to reduce Premier Farnell's existing indebtedness including the redemption of all its preference shares. At the year end, net debt to adjusted EBITDA was 2.6x and headroom on bank borrowings was £216.5m under facilities in place until September 2019.The pro forma impact of the disposal on the Group's total net indebtedness as at 2 August 2015, as if the disposal had occurred on 2 August 2015, was a reduction of £115.1 million from £235.3 million to £120.2 million."
gamesinvestor
17 Mar 2016
Re: Results Omaha, interesting, I hope you are right, but not according to this statement in the results today :- Sale of Akron Brass for $224.2m completed on 16 March 2016, reducing net debt and enabling increased focus on core distribution business.although a reduction of net debt from £256M to £243M doesn't stack up with proceeds of $224M or about £170M --- you'd think a lot more is to be chopped off the debt.£120M of debt would make PFL a pretty safe area with it's current profit generation.Games
Omaha man
17 Mar 2016
Re: Results No - the Akron disposal is after the year end so proceeds of ~£125m will cut debt to ~£120m.
gamesinvestor
17 Mar 2016
Results [link] cut 40%Revenue up 1.6%Gross profit down 4.2%EPS down 38% --- ouch!!Net debt reduced to £243M from 256M due to proceeds of Akron Brass sale.New CEO starts on my birthday 11 April -- got to be a good sign, yes?Games -- stock down 5.56% as I type
Hydrogen Economy
01 Mar 2016
PFL - Post Akron Brass The logic of the Akron-Brass sale seems correct to me, PFL are focused on distributing electronic components and systems, how does an industrial products division selling fire fighting equipment fit? Presumably different drivers and culture are applicable. You might think the Akron-B “Industrial Products” division would be lower margin – but actually the operating margin of 18.6% was the highest in the group which managed 8.6% overall.Effect of sale on 2015 results would have been a 7.6% drop in revenue and 16.5% drop in Operating Profit.Allowing for reduced tax (which I note PFL has been paying at a high rate of 31% of PBT), I estimate that the impact on EPS would be down from 12.9 to 10.3pps. Factoring in a reduction in finance costs by lowering debt with the $224m 160m GBP received (say 6m GBP) gives EPS at 11.5p. That would reduce gross gearing from 87% to around 82% Company stated in the announcement of sale that“-Net cash proceeds arising from the Disposal will be used to reduce Premier Farnell's existing indebtedness and to redeem its preference shares.- The Board's dividend policy is to target a dividend cover in the range of 1.5x to 2.0x; the Board intends to maintain this policy following the Disposal.”I wonder if there will be a temptation to give a sweetener in the form of special dividend. If one quarter of the were distributed that would be 11p. If the disposal realizes a profit, they can presumably do this within their stated policy of 1.5-2x cover. That policy is often introduced when flagging a cut. 2015 cover was 1.3 on adjusted EPS and 1.2 on reported diluted EPS so this is to be expected. Maybe hope of a special payout has helped push SP up 18% since the announcement, it would help smooth a cut in regular dividends.Looking longer term, the real potential here is for the Board to bring the business under tighter control to improve competitiveness (particularly on-line) and manage costs. The steps they are taking seem appropriate so I am optimistic. I claim no special knowledge here, just trying to use the information available to try and understand how this will play out. I bought in few after the Akron sale.H2
gamesinvestor
05 Feb 2016
Re: The Future "Is todays announcement of the anticipated sale the start of a corner turning"Grand, it might well be but all that has happened here is that a piece of the business has been sold.On the positive side it reduces the debt making Farnell less vulnerable and with a stronger balance sheet.But realistically it also means their overall revenue and pre-tax profits are likely to be less going forward for a while. Let's hope they have woken up and stripped out all the unnecessary costs from the remaining distribution business, and beyond the sale of the one division.The problem here is the profit margins have been shrinking and the EPS has declined every year for the last 4, so even projecting a small increase in EPS of 3% (finger in the air guess) would be seen as positive if they can deliver that in 2016.Games -- Got to be worth more than 106 though eh?
Grand Cru
05 Feb 2016
The Future Is todays announcement of the anticipated sale the start of a corner turning. Go to be worth a further punt.
gamesinvestor
05 Feb 2016
Announcement [link] disposal of Akron Brass for US$224.2 million to create a more focused businessPremier Farnell plc (“Premier Farnell”
today announces that, together with its wholly owned subsidiaries, Celdis Limited and Premier Farnell Corp., it has entered into a conditional agreement with respect to the sale of Akron Brass Holding Corp. (“Akron Brass” to IDEX Corporation for cash consideration of US$224.2 million (the “Disposal”.HighlightsTotal consideration of US$224.2 million (£153.8 million), payable in cash on completion, subject to customary adjustments.Represents an attractive enterprise valuation of approximately 8.8x Akron Brass FY15 EBITDA.The Disposal will enable further focus on executing the initiatives identified as part of its operational review to restore growth in profitability in FY17 and provide increased financial flexibility to pursue growth opportunities within the core electronics distribution business.Net cash proceeds arising from the Disposal will be used to reduce Premier Farnell’s existing indebtedness and to redeem its preference shares.As announced on 17 September 2015, the Board’s dividend policy is to target a dividend cover in the range of 1.5x to 2.0x; the Board intends to maintain this policy following the Disposal.Completion is expected by the end of March 2016.The Disposal is a Class 1 transaction for Premier Farnell under the Listing Rules and is therefore conditional, amongst other things, upon the approval of shareholders. A circular containing further details of the Disposal and the notice convening a general meeting will be sent to Premier Farnell shareholders in due course.Games
Speculator 73
03 Feb 2016
Re: 160p offer rumour... Well guess that rumour did not materialise ....Although saying that - this I believe (based on my own research ofcourse) will bounce back ... I am currently adding as soon as it hits 91.5 .....
