Tuesday, September 6, 2016

Gardell would dismember ABB – Private Businesses

It writes TT and Dagens Industri on Tuesday, while ABB president is on a two-day visit to Sweden to Monday to celebrate the 100th anniversary of ABB’s research center in Västerås on Tuesday meet with investors.

“the overall structure is too complex,” says a source who reportedly Cevian Capital loved to have insight into how the activist fund views the issue said.

“why would Cevian love to see a spin-off of Power Grids an independent listed company. It would free up and create significant value of ABB, “added the source.

on Tuesday morning published Barclays (recommendation: overweight, target price 23 Swiss francs against the course 21:80 when the analysis was written) a preliminary comment facing ABB Capital Markets Day on 4 October.

Bank join the ranks of those who do not believe in a spin-off of the Power Grid:

“We do not believe in a division of the company, but would like more details about the areas of Power Grid is providing profitable growth, and which are structurally challenged, “it says in the commentary.

During the second quarter of 2016 reached Power Grids an operational EBITA margin at 9.0 percent, which was within the division’s target range of 8-12 percent, 1 percentage point higher than that achieved in the first quarter, the first with Power Grid in its current guise.

But:

“It can go even better. When you merge companies consumed energy. When you release units, then energy is released. There is a better way to run a business, “said TT’s Cevian Related party source. According to this, Cevian little impressed by the course the lift of 11 percent of ABB’s shares after the fund announced its first purchase, in March 2015.

“the potential of ABB is substantially higher than the current price level reflects,” says the source.

ABB owned according Holdings to 10.03 percent by Investor and 5.16 percent of the second-largest shareholder Cevian, which so far lacks a director of ABB.

Chart: ABB 2011-2016

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Source: Infront

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