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Looks like JD were sniffing at it for few months now, and timing of the Elliot bid and news release could be to extract more value from JD:
"The BBC understands that conversations with JD.com on a possible transaction started towards the end of last year as the Chinese firm looked at options to expand internationally because of weaker demand in its home market. "
https://www.bbc.co.uk/news/business-68335829
Interesting analysis on JD's positino and need to buy Currys:
https://www.telegraph.co.uk/business/2024/02/20/currys-fate-shows-future-shopping-is-chinese/
Seems 1bn is a realistic target.
https://www.theguardian.com/business/2024/feb/19/currys-board-bidders-us-hedge-fund-elliott
The board of Currys rightly rejected that effort as a “significant” undervaluation, and one hopes the directors will say the same about offers several rungs up the ladder. Yes, the shares, up 38% at 65p on Monday, traded at 47p last week but broker Peel Hunt, for one, reckons there’s no need for the board to engage at anything less than 80p. Over at Investec, analysts had a 78p target price before the fun even started.
None of which is to deny that Currys has frustrated its long-term owners. The Carphone merger was one of the worst deals in modern retailing history – the mobile phone market shifted and all the standalone phone shops were closed in 2020. Then, after the Covid surge in demand for electrical goods, the previously reliable Nordic business ran into stiffer local competition and Currys was caught half asleep. The point, though, is that the position now looks stable. The chief executive, Alex Baldock, last month nudged up this year’s pre-tax profits guidance to £105m-£115m.
A complication in the background is a deficit in the pension fund of about £250m that will require top-up payments for several years, limiting cash for dividends. On the other side of the ledger, the group should soon be debt-free after agreeing the sale of its Greek business for £156m. If the ambition to achieve a 3% profit margin in the core operations is credible – it ought to be – the germ of a turnaround story is in place. The consumer weather should also improve when interest rates start to fall.
At 62p, Currys would have been valued at just seven times next year’s projected earnings, on Peel Hunt’s numbers. Even in a soggy retail sector, that’s a miserable rating. There will be several more rounds of this saga to come, one suspects, but the job of Currys’ board is to play hardball. If the opportunistic bidders can’t be pushed close to £1bn, there is no shame in staying independent.
Elliot want it cheap a will dance to 78p but they are being led a merry dance by the BoD who are fully engaged with maximising value for shareholders by JD route.
The purpose of outing the 2 in one day is a ploy to see what other players are interested.
Curry's is on the block and only the price is in question. They already maxed the Greek deal and sorted the Nordics and are feathering their nests.
For the LH holders, they do not care which is sad but the game is to agree a deal which moves everyone on.
Take out will be around 1bn market cap 90p minimum unless another interested party emerges.
In UK, Amazon could sew up the market by adding Bricks and Mortar and self supplying products while incorporating the use of the large stores as drop off collection points for other Amazon offerings. Over to Jeff with a knockout bid for the network.
Same again tomorrow, well not perhaps another 37% but a 10p rise would be welcome.
Expecting another offer later this week about 75p and will sell then.
BoD have done all the hard work, trimming 300m of costs, Greek business sold for a fab multiple.
Shame to see the rewards being hijacked by a low bid. Let's see the growth story.
This will be taken out at over a pound..The electrical market is ripe for a good retailer.Profits are low but really Currys who have all the advantages have lost most of them over bad management over a number of years.Their stores do not offer good service as they have cut their staffing to the bone and must lose so many sales.I bought many items last year from then and the wait to get served was very bad indeed.Good luck to all lth
Taverham yes we now got a mini economy
https://youtu.be/loQPviYMydk?si=g0-_pthA3vPXew52
Eviking, could'nt agree more and it has been going on for some time. About 40 years ago I remember [but I did'nt believe him] an older guy telling me that the yanks had purposefully destroyed our jet fighter programme and that our industries were falling one by one; Planes, motorcycles and then cars . How right he was and how sad the process has continued through to the retail sector!
Taverham British brands going like the body shop... whats left not worth selling. Steels gone 2
The schools been build with cheap autoclave concrete beams to be domolished.
What a soap opera lol
Not much more to say than that.
Only thing I notice, however, is that they dont seem to own much of their property. It is mainly leases.
My initial thought was that this could be a break-up play based on NAV.
Do they have some proprietary tech or something?
It Is not really relevant if there is a bid incoming, but am concerned what would happen if I bought now and a bid didnt materialise.
Good luck to you if you already hold.
Good old currys - as hot as a vindaloo today!
UK market has become really useless at valuing companies on its own. It seems to require foreign bidders to turn up before the good companies sold at peanuts!
Last week, analysts at Investec said the Care & Repair business alone could be worth as much as £667m, while mobile business could be valued at about £500m.
Ben Hunt, equity retail analyst at Investec, said the interest in Currys reflected the fact that while "the news isn't getting any worse" for many struggling retailers at the moment, with price rises easing and real incomes now improving, share prices remain low in the sector and do not reflect the potential for recovery.
This makes companies such as Currys an "easy steal" for private equity firms who are looking to pick up undervalued businesses, he said.
In addition, Currys has "done a lot of the heavy lifting" already for any potential suitor, having cut £300m from its annual costs.
Many commentators have said that UK firms are looking undervalued, and Erik Hirsch, co-CEO of the US private equity firm Hamilton Lane, told the BBC's Today programme: "I think everyone's looking at the UK more closely.
"Private markets are always looking for value... and today the UK is certainly offering that in places."
Taverham us market closed today
Trimming on the way up on spikes 38%, took 9% off a short time ago and will trim as SP rises and may rebuy the drops. Will be volatile for a while but 85p -£! seems to be the ceiling.
Expect the next trim to be around 72/3p. Worked well with WG. group so same plan here but felling is that this will result in an agreed bid once the price is struck.
GLA
Mike Ashley will be king maker here
I would be happy with 90p as a minimum but in all honesty I would prefer to keep my shares as I believe the company will do much better in the coming years and is currently undervalued.
Margins are so tight for these businesses right now, that it's about removing competitors = more pie slice for those remaining in the game!
Fforest, I think that the initial rsie is largely retail invstors and more serious money will be deployed once the participants have had a chance to speak with their friends ti find out what is really going to happen - we can only guess.
Just wait for 16 march they walk and a not short to have :-)