M&S’s Cash Generation May Be Worth 600p/Shr in LBO, SocGen Says
2014-05-21 14:37:06.21 GMT
By Heather Burke
May 21 (Bloomberg) -- Marks & Spencer’s cash generation has
value, 600p may be a “financially feasible” bid, SocGen (buy)
says.
* Mkt ignoring M&S’s cash flow, value in cash-generative
retailers
* LBO model used to calculate a theoretical shr price private
equity could pay in a leveraged deal; est. 600p/shr
feasible, backed by better cash flow prospects; assumes deal
structure of 40% equity, 60% debt
* 600p would be 34% premium to intra-day shr price of 447p
* Optimistic on general merchandise LFL sales turnaround
* Raises PT to 617p from 609p: SocGen
* NOTE: Marks & Spencer Weighed Down by Legacy of CEO’s Missed
Goals
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Heather Burke in London at +44-20-7673-2044 or
hburke2@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net
2014-05-21 14:37:06.21 GMT
By Heather Burke
May 21 (Bloomberg) -- Marks & Spencer’s cash generation has
value, 600p may be a “financially feasible” bid, SocGen (buy)
says.
* Mkt ignoring M&S’s cash flow, value in cash-generative
retailers
* LBO model used to calculate a theoretical shr price private
equity could pay in a leveraged deal; est. 600p/shr
feasible, backed by better cash flow prospects; assumes deal
structure of 40% equity, 60% debt
* 600p would be 34% premium to intra-day shr price of 447p
* Optimistic on general merchandise LFL sales turnaround
* Raises PT to 617p from 609p: SocGen
* NOTE: Marks & Spencer Weighed Down by Legacy of CEO’s Missed
Goals
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Heather Burke in London at +44-20-7673-2044 or
hburke2@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net