Yes I fully understood the differentiation. I did not get the part that you already had the methodology but I thought you derived the methodology and then tested if it was correct by applying it to the years after 2022 to see if calculated results with the derived methodology would match actual numbers.
How certain are you that we can completely deconsolidate Dt. Wohnens numbers to arrive at Vonovia adj. EBT ex Dt. Wohnen and our methodology overall is correct? Has this be done also in other DPLTA cases in which one company already consolidated the numbers of the other company when DCF was used?
I assume that if we adjust our scenarios based on our new findings, the average weighted price and your recommendations would be significantly better?
The document that you found regarding the JV is very interesting. In the future we always have to search directly on the investor relation websites of both companies when significant news are announced to see if they publish any more details.
It basically confirms the whispers and therefore a share price of EUR 25/26.0 in the transaction and tells us that the investors are insurance companies and other Appolo Investors (not only current investors who swapped their stake) and most importantly it gives us an indication how high the annual fixed compensation offer will be.
I found the exact statement regarding it a bit tricky to interpret and also attached it below. My take is that “minorities” does only refer to external shareholders and not the 49% of the JV that is owned by Vonovia and ChatGPT seems to confirm this.
This means the up to 70m will go to the 10.2% Apollo investors and any investors that refuse to exchange their shares for Vonovia shares. Let’s say if 5% do not tender their shares, 70m will go to 10.2%+5%=15.2% of the share capital. Considering a valuation of the Apollo shares of “a bit more than 1billion” we can assume that the value of the total shares of external shareholders is around 1.5billion. This would mean that the compensation yield for the shareholders would be 70m/1500m=4.66%.
Broadly speaking I think we can say that the yield offered to shareholders will be between 4% and 5% given that neither we nor Vonovia current knows how many shareholders will not tender their shares and we don’t know with which scenario Vonovia is calculating in their press release.
What is your take? Can you maybe write a short mail to Vonovia investor relations to get a definitive answer if the 49% in the JV held by Vonovia would be included in the minority line item or if this line item is only considering external shareholders?
Which risks do you see from here? I am still heavily considering to increase the position esp. if it will be clear that the compensation offer will be at least 4% based on current prices and Vonovia could not opt for a very low compensation offer + our confidence is increasing that the share exchange offer will be good. On the other side if you believe that after concluding our analysis of the share exchange price and potential clarification from Vonovia that there are risks that I might underestimate or you strongly feel I should be more careful I would be very interested in any arguments (actually for both sides also the bull case) that could help me to take a better decision.
