(News Bulletin 247) – The manufacturer of assembly solutions and components is taking advantage of a reorganization operation of its holding company to offer its shareholders who so wish, an exit door at 27 euros per share.
Lisi is giving its share price a little boost, which has lost more than 30% over the year 2022. The group specializing in components and assembly solutions intends to launch a public share buyback offer (OPRA) in price of 27 euros per share.
The announced price takes into account an upcoming dividend payment of 0.15 euro and represents a premium of 24% on the last closing price of February 22, of 21.90 euros. On the Paris Stock Exchange, Lisi takes the lead in the Parisian market. This proposed public share buyback offer led to a rebound in the stock of 12.8% to 24.70 euros, around 1:05 p.m.
Lisi thus proposes to buy back a maximum of 7,576,004 shares, representing 14% of its capital. As it proposes to buy back more than 10%, the company is forced by stock market regulations to launch an OPRA. If the securities presented represent more than this level, he acquires only part of them (each sell order is reduced in proportion to the amount requested by the acquirer).
A reorganization of the holding company
The operation led by Lisi is part of a reorganization of the capital which aims to simplify the capital structure of the Compagnie Industrielle de Delle (CID), which is the controlling shareholder of Lisi.
The Kohler and Viellard families, which are the founding and controlling families of CID, have been associated with the Peugeot family within this holding company for more than 40 years. Peugeot Invest, which owns 5.1% of the capital of LISI and 25.4% of the capital of the Compagnie Industrielle de Delle (CID), has undertaken to tender its Lisi shares to the OPRA.
Following the OPRA and a capital reduction concerning CID, Peugeot Invest could no longer hold CID shares and would become Lisi’s second largest shareholder, with up to 16% of the capital.
A way out for disgruntled shareholders
The offer will be launched between mid-May and the end of June, according to the indicative timetable provided by Lisi. The offer, for an amount of 205 million euros, will be financed by available cash and by drawing 200 million euros on an additional bank loan.
The operation will offer shareholders who are dissatisfied with the behavior of the share the possibility of reducing their position by pocketing immediate cash, without any obligation to contribute their shares. And for shareholders not participating in the operation, the OPRA leads to an automatic accretion. In the case of Lisi, it will have an accretive effect of approximately 9% on the estimated earnings per share for 2024, assuming that all the shares concerned are tendered to the OPRA.
The OPRA can also be a first step towards leaving the stock market with the aim of buying back the float without the shareholders in control of the company contributing to the offer. This was also the case for Iliad at the end of 2019: while the price was dragging at the end of 2019 under 100 euros (95.06 euros precisely on the eve of the announcement), Xavier Niel’s telecom group had then offered to buy 20% of its own capital via an OPRA significantly above the then price, or 120 euros per share. This operation was followed two years later by the takeover bid and the delisting.
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