Siemens Gamesa has been inert for 4 months due to the takeover bid: experts advise going

The price of the share of does not exceed 18 euros practically since the public offer of shares (takeover bid) of Siemens Energy on the Spanish renewable subsidiary was announced. And it may not do it again if the majority recommendation of the market to go to it is taken into account.

The CEO of the German company, Christian Bruch, ventured last week to state that the takeover bid for Gamesa would be launched in mid-September, as already highlighted from Munich in the presentation of the group’s accounts for the third quarter. “The poor performance of Siemens Gamesa had a negative impact on our results,” Bruch himself announced at the opening of the presentation. This “bad performance” is the justification that the group maintains to exclude from the market with its takeover bid for 32.9% of the shares that it does not yet control of its subsidiary in Spain.

The offer of 18.05 euros per share of the parent company has since the end of May with the consensus of experts who follow the Spanish company -and compiled by Bloomberg- and which was already being reduced prior to the announcement of the takeover bid due to the successive cuts in the profit forecasts they expect from for this year. The last significant change announced by the group involves reaching revenues in 2022 that are 9% lower than those of the previous fiscal year and an EBIT margin of 5.5% below that of 2021 (they also expect it to be negative in 2023).

In addition to the “own influence of the takeover bid on the value”, as pointed out by Banco Sabadell, the analysis firms do not make good forecasts of Gamesa’s performance in the year. “Siemens Gamesa posted weak fiscal third quarter results. Revenue was up 3% but adjusted EBIT was a significant flop, with a loss of €343 million, against consensus of a loss of €235 million,” Deutsche said. Bank, who were among the first to set their target price at the bid price.

Thus, and although the subsidiary based in Vizcaya -like the one recently obtained in the US to supply 84 turbines- prevails over the plans of the experts to hold on to the Siemens Energy offer. No firm collected by Bloomberg advises taking positions in Gamesa or sees it trading above the offer price.

The intention of Siemens (parent company) is to exclude Gamesa from negotiation even if it fails to reach the 90% threshold. According to Banco Sabadell, Siemens could propose exclusion to the Shareholders’ Meeting once it controls 75%. The operation -backed by BofA and JP Morgan- is encrypted at 4,000 euros, of which 2,500 million would be disbursed with own funds and the rest with cash and debt issues.