(Finance) – Equity has increased a 13.6 euros per share (+70%, with possible room up to 14.5 euros with prudent revenue synergies) on target price on Newlat Foodan Italian multi-brand group in the agri-food sector and listed on Euronext STAR Milan, confirming the recommendation “Buy” in a note in which he explained the estimates for New Princes, the group that will be born from the combination between Newlat and Princes with the closing of the Princes acquisition expected for the month of July.
Analysts confirm the positive view on the deal which will transform Newlat into a leading company in Europe in the food sector, with significant potential synergies and structural benefits in terms of efficiency, bargaining power and further M&A opportunities thanks to the significant leap in size and the well-diversified portfolio across 10 segments. They think that the solid management track record in past acquisitions you support visibility on synergies both from cost (such as with Central Milk of Italy and even before that with Birkel & Drei Glocken) and revenue-generating (recently with Symington’s and EM Foods).
However, they also believe that “the title may merit progressively more generous multiples compared to what is implicit in our assessment as visibility also increases on some elements that are not entirely explicit to date (details on the specific actions planned by management, on Princes’ financials, on integration costs) and in parallel with the execution of the industrial plan , also considering the increase in complexity compared to previous M&A operations”.
(Photo: Newlat)