On Saturday (23 November 2019), Mesna Industrija Pivac published an announcement on their website stating that they have signed a Sale and Transfer Agreement with Kraš ESOP, through which they acquired an additional 18.45% stake in Kraš.
The mentioned amount refers to all shares of Kraš ESOP which were acquired for HRK 238.1m or HRK 861.2 per share (assuming only shares were acquired, and not the entire ESOP company with its entire balance sheet). Such a indicative price per share equals to the volume weighted average of all prices realized on the stock exchange in the past 3 months and in the same time more than double what MI Pivac offered in their takeover bid. With this acquisition, MI Pivac currently have a 49.16% stake in Kraš and 51.8 % of voting rights (5.1% of shares are in treasury).
Besides the mentioned agreement, MI Pivac, Kraš ESOP and Sindikat PPDIV also signed the Agreement on social partnership, through which additional obligations of Pivac were defined (such as: confirming their further investment in development of Kraš, the continuation of respect and protection on the level of employee rights and maintaining production facilities at the existing locations).
Kraš YTD Share Price Performance & Turnover (HRK)
The Saturday’s news came right after the expiry of takeover bid by MI Pivac. As a reminder, on 24 October MI Pivac published a takeover bid, offering HRK 430 per share. At the moment, there is no official statement by MI Pivac or Kraš on the outcome of the takeover bid but one can safely assume that at such prices Pivac did not acquire a significant stake in the company. The mentioned takeover bid of HRK 430 per share translates to P/E of 12 and EV/EBITDA of 7. In comparison, the acquisition of ESOP shares translates into P/E of 23.9 and EV/EBITDA of 12.7 (again assuming only KRAS shares from ESOP were acquired)
From the market perspective, in the last 2 trading days Kraš once again observed a strong increase in turnover amounting to HRK 27m (cumulatively Thursday and Friday). Trading was concluded at HRK 1050 per share – a price which we have now seen for more than a month (with the exception of 25 October) and which translates into P/E of 29.3 and EV/EBITDA of 14.6.
It is safe to assume that the primary buyer of the shares on the market is Kappa Star Limited. We are eager to see how the recent development regarding the shareholder structure will translate into the stock exchange dynamics.
The Croatian Bureau of Statistics published their October Employment report. According to it, the registered unemployment rate in October stood at 7.2% (-1.9 p.p. YoY).
As the Croatian Bureau of Statistics published their October Employment report, we are bringing you key takes from it. According to it, in October the total number of unemployed persons amounted to 121,597, representing a decrease of 14.2% YoY, however an increase of 8.2% MoM. This translates to the total registered unemployment rate of 7.2% (-1.9 p.p. YoY or + 0.5 p.p. MoM). The monthly increase of unemployment rate is in line with annual cyclicality of Croatian economy that is reliant on summer tourist season due to which part of work force returns to unemployment every year when the seasons ends. Meanwhile, unemployment rate for women in the same period stood at 8.4% (-2.1 p.p.).
In October 2019, the total number of persons in employment in Croatia was 1.56m, of which 0.73m were women. Compared to September 2019, the total number of persons in employment decreased by 3807 persons. Meanwhile on a YoY basis, the total number of persons in employment increased in October 2019 by 9.4%.
Of that, the total number of persons in paid employment in legal entities amounted to 1.34m, representing an increase of 10.8% YoY or an increase of 1% MoM. In the same period, the total number of persons in employment in trades and crafts and free lances decreased by 5% MoM, while it increased by 1.2% YoY.
Unemployement Development in Croatia