EXO.MI - EXOR

[PlanMaestro]

Cushman, Exor and Fiat.

 

http://online.wsj.com/article_email/SB10001424127887323566804578549852116303288-lMyQjAxMTAzMDEwNzExNDcyWj.html?mod=wsj_valettop_email

[writser]

Exor writeup linked to from Valueinvestorsclub: (doesn't seem to contain any special insights)

 

https://docs.google.com/file/d/0B05tKda-r0CsYUZJcU80ZnRFOWM/edit?usp=sharing

[Sportgamma]

Coincidentally:

 

RCS Mediagroup capital increase

"Italian carmaker Fiat said on Friday it will almost double its stake in RCS Mediagroup, the publisher of influential Italian daily Corriere della Sera, to 20.1 percent after a capital increase that ends next week."

http://www.reuters.com/article/2013/06/28/us-fiat-rcsmediagroup-idUSBRE95R0TW20130628?feedType=RSS&feedName=innovationNews&rpc=43

 

News Corp Spinoff

"The publishing spinoff includes News Corp's newspapers including The Wall Street Journal and The Times in London, a cable network and pay-TV provider in Australia, book publisher HarperCollins and fledgling education company, Amplify.

 

The company named current directors Lachlan Murdoch and James Murdoch to the board of the new News Corp. New additions to the board include Thomson; Ana Paula Pessoa, a partner at Brunswick Group; John Elkann, head of Exor SpA ; and Masroor Siddiqui, head of investment firm Naya Management."

http://www.reuters.com/article/2013/05/24/newscorp-spinoff-idUSL2N0E50LG20130524

 

And of course, then there is The Economist

http://www.economistgroup.com/results_and_governance/board.html

[Sportgamma]

When in Rome...

 

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/427165c2-dbfa-11e2-a861-00144feab7de.html#ixzz2XnAYOrj0

 

“We are branding Rome. Football teams in Italy traded on revenues and a certain amount of ego. We didn’t do this for ego,” says Mr Pallotta, who reckons that if Manchester United is worth some $3.9bn and Roma is currently valued at less than $200m, then “there is a lot of opportunity to bridge that chasm”.

Lossmaking Roma was sold in 2011 by the indebted Sensi family for a rock bottom €70.3m to a US consortium led by Thomas DiBenedetto, president of the investment management firm Boston International Group, which took a 67 per cent stake. UniCredit, exposed to the Sensi’s family’s debt, was left with a minority stake it hopes to reduce, while less than 15 per cent is owned by small stakeholders, many of them fans, with shares quoted on the Milan bourse.

Last season Mr Pallotta increased his personal stake to “close to one-third or more” and became chairman. His Boston–based Raptor Group, which includes a scaled-down hedge fund and owns the Boston Celtics basketball team, has a majority overall.

“My guess is a lot of people with deep pockets would love to have Roma,” says Mr Pallotta, who disclosed that the group intends to raise new capital of at least $75m, with US bank Morgan Stanley acting as adviser.

In terms of marketing, Mr Pallotta feels he is starting from zero, with Italian clubs far behind their foreign rivals.

“We are trying to bring a lot of professionalism to the club, using the best practices of US sports teams which are arguably as good as anyone’s. Before we came there was no social media. Zero. The previous owners did nothing, forget about Facebook or Twitter. There was no fan management system at all,” says Mr Pallotta.

The club, which has signed sponsorship deals with Nike and Disney, is following the experience of the Boston Celtics which have gone ticketless, with spectators using mobile phones to access the stadium, meaning Roma will build a database on its supporters.

In the US the group is working on smartphone systems to allow fans to order snacks which are then delivered to their seats. “People will order substantially more if they don’t have to leave their seat. Hopefully in the new stadium we will use a lot of this technology,” says Mr Pallotta.

The new premises will also have more control over security, with plans to adopt facial recognition technology to identify the fans behind the racist chanting that has already cost the club a fine of €50,000.

The club has adopted a new logo – to the anger of some fans – which was presented in St Peter’s Square, along with a Boston Celtics shirt, to Pope Francis, a keen football fan, in a media coup.

Profitability is going to be a long haul and will take more than a papal blessing, however.

 

Full article: http://www.ft.com/intl/cms/s/0/427165c2-dbfa-11e2-a861-00144feab7de.html#axzz2Xn8mjhSW

[plato1976]

I bought some exor

I feel it has a few catalyts ahead:

1. fiat industry valuation may get higher after the merge

2. possible fiat / chrysler merge ahead

to me it's a more conservative way to play fiat group, although the upside may be less than buying fiaty itself.

 

When in Rome...

 

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/427165c2-dbfa-11e2-a861-00144feab7de.html#ixzz2XnAYOrj0

 

“We are branding Rome. Football teams in Italy traded on revenues and a certain amount of ego. We didn’t do this for ego,” says Mr Pallotta, who reckons that if Manchester United is worth some $3.9bn and Roma is currently valued at less than $200m, then “there is a lot of opportunity to bridge that chasm”.

Lossmaking Roma was sold in 2011 by the indebted Sensi family for a rock bottom €70.3m to a US consortium led by Thomas DiBenedetto, president of the investment management firm Boston International Group, which took a 67 per cent stake. UniCredit, exposed to the Sensi’s family’s debt, was left with a minority stake it hopes to reduce, while less than 15 per cent is owned by small stakeholders, many of them fans, with shares quoted on the Milan bourse.

Last season Mr Pallotta increased his personal stake to “close to one-third or more” and became chairman. His Boston–based Raptor Group, which includes a scaled-down hedge fund and owns the Boston Celtics basketball team, has a majority overall.

“My guess is a lot of people with deep pockets would love to have Roma,” says Mr Pallotta, who disclosed that the group intends to raise new capital of at least $75m, with US bank Morgan Stanley acting as adviser.

In terms of marketing, Mr Pallotta feels he is starting from zero, with Italian clubs far behind their foreign rivals.

“We are trying to bring a lot of professionalism to the club, using the best practices of US sports teams which are arguably as good as anyone’s. Before we came there was no social media. Zero. The previous owners did nothing, forget about Facebook or Twitter. There was no fan management system at all,” says Mr Pallotta.

The club, which has signed sponsorship deals with Nike and Disney, is following the experience of the Boston Celtics which have gone ticketless, with spectators using mobile phones to access the stadium, meaning Roma will build a database on its supporters.

In the US the group is working on smartphone systems to allow fans to order snacks which are then delivered to their seats. “People will order substantially more if they don’t have to leave their seat. Hopefully in the new stadium we will use a lot of this technology,” says Mr Pallotta.

The new premises will also have more control over security, with plans to adopt facial recognition technology to identify the fans behind the racist chanting that has already cost the club a fine of €50,000.

The club has adopted a new logo – to the anger of some fans – which was presented in St Peter’s Square, along with a Boston Celtics shirt, to Pope Francis, a keen football fan, in a media coup.

Profitability is going to be a long haul and will take more than a papal blessing, however.

 

Full article: http://www.ft.com/intl/cms/s/0/427165c2-dbfa-11e2-a861-00144feab7de.html#axzz2Xn8mjhSW

[Guest hellsten]

Greenwood Investors on EXOR and Fiat:

Prior to June 6, a large portion of Exor’s NAV was invested in SGS SA, the first major turn-around of Sergio Marchionne’s career. 

He was so successful, he built SGS into a CHF16 billion test and inspection business, with a lofty valuation of 14x EBITDA. 

…

We were never comfortable having such a large portion of our “401(k)” in such a highly-priced security. 

This discomfort has now eased since Exor has exited its investment in SGS, and now has an over-capitalized balance sheet ripe for share repurchases.

…

On Tuesday, the Delaware judge ruled in Fiat’s favor on two of the most significant aspects of the disagreement:

 

1) whether or not the debt owed to VEBA was in fact considered debt in the option formula, and

2) the treatment of minority interest in calculating the formula (the option agreement forgot to remove the effects of minority interest from EBITDA, or add it to the EV). 

…

The judge’s decision clears a large portion of the uncertainty away for both parties in determining what the contractual price will be for the 40% interest covered by this call option.

…

When such a transaction is complete, assuming the maximum contractual price is paid, we think shares of the combined entity are significantly undervalued relative to GM or Ford, while Fiat-Chrysler has far more margin expansion potential than any auto peer.

…

For further support on timing an entry into Exor, the current discount to NAV of 37.2% at the midpoint of the recent trading range of 32.2% to 43.6%. 

Recently, the company has been a fairly aggressive buyer of its own stock when the discount reaches the high 30%-range, keeping a floor on just how wide the discount can get.

…

Realizing the key role Chrysler’s platforms will play in breathing life into Alfa Romeo’s renaissance, for a very reasonable capital commitment and a third of the stand-alone cost, Fiat will be able to launch key models in the coming years that will more than triple Alfa’s current sales. 

…

If Alfa is able to achieve such selling levels (~300k annual volumes), the unit would generate over €1 billion in EBITDA.  Such a business would be worth north of €6 billion, or nearly the entire market cap of Fiat currently.

…

To briefly summarize, Exor is a great “portfolio” for any investor, given the deep undervaluation of Fiat and its near-term operating trajectory as well as the robust operating profile of CNH and the free upside of an Iveco turnaround.  In addition, investors in Exor can get these companies, along with a few other attractive assets, at a discount of 37% at today’s share price. 

 

Share repurchases at Exor can fuel per share NAV growth, which in combination with improvements in operations at both key companies, and share price appreciation, can create a “lollapalooza” effect on shares of Exor.

 

http://www.gwinvestors.com/Main/Blog/Entries/2013/8/1_Exor_SpA_%28EXO_IM%29__The_Italians_Are_Coming.html

 

[Phaceliacapital]

http://www.gwinvestors.com/Main/Blog/Entries/2013/8/16_Presentation_For_Todays_Call_files/2013%20Q3%20Investor%20Call%20Presentation.pdf

[Sportgamma]

[iurl=https://fundamentalfinanceplaybook.com/2011/03/12/juve-reevaluating-the-original-thesis]Juventus financial statements[/iurl] for 2012/2013:

Cash flow from operations €48m (up from €-3m)

Cash used in investing activities €74.5m (down from €116m)

Net cash €-97m (down from €-58)

 

http://www.juventus.com/wps/wcm/connect/f0bdac8d-4d89-4dbb-a69b-eddcd26db235/Comunicato+24092013+approvazione+bilancio+eng.pdf?MOD=AJPERES&CACHEID=f0bdac8d-4d89-4dbb-a69b-eddcd26db235

 

Adidas deal:

adidas will be the technical sponsor of all Juventus teams for a fixed consideration of € 139.5 million for the six-year term. The consideration does not include the value of adidas products that will be annually supplied to the club or the programme of performance related incentives and bonuses available to the club.

adidas will manage all Juventus’ licensing and merchandising activities for a fixed consideration of € 6 million per annum.

The club may also benefit from additional royalty payments upon exceeding a threshold of sales.

 

http://www.juventus.com/wps/wcm/connect/03062091-0131-4053-8e95-6116a870673a/comunicato+24102013+sponsor+tecnico+eng.pdf?MOD=AJPERES&CACHEID=03062091-0131-4053-8e95-6116a870673a

[phil_Buffett]

http://www.exor.com/uploads/831676-CdA_14nov2013_9M13_en.pdf

 

NAV now by 9,16b.€

[muscleman]

http://www.exor.com/uploads/831676-CdA_14nov2013_9M13_en.pdf

 

NAV now by 9,16b.€

 

"On November 12, 2013 EXOR issued non-convertible bonds for €200 million with

final maturity November 12, 2020 and an annual coupon of 3.375%, through a private

placement to institutional investors. "

 

Really? That is quite nice! Not many companies can get rates this low. :)

Why don't they repurchase shares with this money?

[phil_Buffett]

http://www.exor.com/uploads/831676-CdA_14nov2013_9M13_en.pdf

 

NAV now by 9,16b.

 

"On November 12, 2013 EXOR issued non-convertible bonds for 200 million with

final maturity November 12, 2020 and an annual coupon of 3.375%, through a private

placement to institutional investors. "

 

Really? That is quite nice! Not many companies can get rates this low. :)

Why don't they repurchase shares with this money?

 

i have a Feeling the finance some of the chyrsler purchase indirect to fiat.

[txlaw]

http://www.bloomberg.com/news/2014-01-16/fiat-heir-elkann-reshapes-family-legacy-with-chrysler.html

[fareastwarriors]

Italy's Exor Says May Provide More Capital to Firms in Which It Invests

 

 

http://www.nytimes.com/reuters/2014/04/09/business/09reuters-exor-capital.html?src=busln&_r=0

[Guest ajc]

 

Italian holding company Exor is looking for one or two other investments that would complement its portfolio, most likely in the services sector, Chief Executive John Elkann said on Thursday.

 

Elkann said Exor, whose three major investments include stakes in carmaker Fiat Chrysler Automobiles (FCA), tractor and truck maker CNH Industrial and real estate group Cushman & Wakefield, would look at companies that are similar to those three in that they have roots in Europe or America but operate globally.

 

"It's more likely that we will make the investments in sectors that absorb less capital than CNH Industrial or FCA and which are more in the services sector, and not in industrials, " Elkann told journalists on the sidelines of a shareholder meeting in Turin.

 

 

http://www.reuters.com/article/2014/05/22/exor-idUSI6N0O100020140522

 

 

 

[Sportgamma]

Interview with Lapo:

 

Interview with John:

 

John speaking at the Family Capitalism Conference:

 

 

[Phaceliacapital]

Guys,

 

I spend some time revisiting this file with updated valuations, I made a spreadsheet if you want to toy around with valuations:

 

https://docs.google.com/spreadsheets/d/12toIDTeWXj4G_1Bvg8GDZEwIYtyB1DHmDhGjStAIQtA/edit?usp=sharing

 

I arrived at a +/- 20% holding discount.

 

If you assume the IPO value for CNH (9) and fair value for FCA of 11 you get a 40% discount.

[fareastwarriors]

Warren Buffett, Italian-Style

http://www.nytimes.com/2015/04/16/business/dealbook/warren-buffett-italian-style.html?ref=dealbook

[txlaw]

Question for the board:

 

Have any US investors analyze whether or not Exor is a PFIC?

 

If it is a PFIC, would a successful PartnerRe acquisition take it out of PFIC status?

[muscleman]

Question for the board:

 

Have any US investors analyze whether or not Exor is a PFIC?

 

If it is a PFIC, would a successful PartnerRe acquisition take it out of PFIC status?

 

I'd like other investors to weight in, but I don't think this is a PFIC.

The reason is that for any stocks owned by the company, if the stock ownership is over 25%, then it should be treated as a look-through basis.

In addition, foreign banks and insurers are exempt from the passive income asset test.

 

Any PFIC experts, please let me know if I am wrong. :)

[Ian L]

Juventus through to the Champions league final now. Good advertising for Jeep.

Plus all of the oil powered clubs in Europe are chasing after Pogba. That was a shrewd signing after Alex Ferguson refused him a wage increase that would be a pittance compared to the salaries the big money clubs will be offering.

[Phaceliacapital]

By Dan Liefgreen, Tommaso Ebhardt and Daniele Lepido

    (Bloomberg) -- As a boy, John Elkann watched his grandfather Gianni Agnelli build Italy’s biggest industrial fortune, but as an adult he has never adopted Agnelli’s swashbuckling style.

    Lately, though, Elkann has embraced at least one of his grandfather’s trademarks: dealmaking.

    Exor SpA, the Agnelli family investment company led by the 39-year-old Elkann, on Wednesday emerged as the largest investor in The Economist magazine. And on Aug. 3, Exor won a takeover battle to buy reinsurer PartnerRe Ltd. for about $6.9 billion.

    “These deals show how John Elkann has matured, making him one of the most interesting dealmakers around,” said Enrico Valdani, a professor of economics and business management at Milan’s Bocconi University.

    Elkann is aiming to streamline the family’s holdings. In May, Exor sold real-estate company Cushman & Wakefield Inc. for about $2 billion. And last year Elkann joined with Fiat SpA Chief Executive Officer Sergio Marchionne to engineer a takeover of Chrysler and list the combined company in New York.

    “We have worked very hard in the last few years to simplify what Exor is,” Elkann said in May. The goal, he said, is “owning fewer companies but of bigger size.”

    As Elkann was working on the PartnerRe deal he was negotiating an increase in Exor’s stake in the Economist, half- owned by Pearson Plc. Other shareholders included European dynasties such as the Cadburys, Rothschilds and Schroders.

    On July 25 Elkann attended the wedding of his wife’s step- sister, Beatrice Borromeo, to Pierre Casiraghi, one of the heirs to the throne of Monaco. As the guests gathered, Elkann oversaw preparation of a statement emphasizing he didn’t intend to upset the status quo at the magazine by aiming for full control.

 

                          Best-Dressed

 

    In the end, Exor boosted its stake in The Economist Group to 43.4 percent from 4.7 percent, while the Rothschilds increased their share to 26 percent from 21 percent.

    Exor controls businesses ranging from Fiat Chrysler to Italian soccer champion Juventus. The Economist will add to a portfolio of media holdings that include Turin daily La Stampa, which Exor controls through Fiat. The carmaker is also the lead investor in a media company that publishes Italy’s biggest newspaper, Corriere della Sera.

    Agnelli, a jet-setter still known to Italians as “L’Avvocato,” or “the attorney,” died in 2003. Dubbed one of the world’s best-dressed men by Esquire Magazine, Agnelli was treated like royalty by the Italian press, frequently spotted consorting with luminaries such as Jacqueline Kennedy Onassis and Henry Kissinger.

    Agnelli took over Fiat from his own grandfather, Giovanni Agnelli, and after World War II helped rebuild Italy’s largest manufacturer. Over the years, he added production of railroad cars, airplane components, tractors and trucks. In 1966, he began a 30-year stint as Fiat chairman, buying up rivals including Ferrari, Maserati and Alfa Romeo. Today, almost four- fifths of Exor revenue and half of its profit comes from auto manufacturing.

    Elkann, Agnelli’s eldest grandchild, was born in New York, the son of Margherita Agnelli and Alain Elkann, a French-Italian writer. The avid sailor and soccer player is tall and gangly with tousled dark hair and a boyish smile. In public, Elkann comes off as shy, and when he speaks his delivery is slow and deliberate, as if he’s weighing each word.

    Elkann has overseen the family fortune since 2004, when Agnelli’s brother Umberto died. Exor was formed in 2009 with the merger of a pair of holding companies, and its shares have risen more than seven-fold since then. The family’s 51 percent stake in Exor is valued at 5.6 billion euros ($6.2 billion).

 

                        Leaving Italy?

 

    Despite Elkann’s stewardship of the business, union leaders and even some business executives have criticized him for abandoning the country where the family made its fortune.

    “The Agnellis are leaving Italy,” Diego Della Valle, the founder of leather-goods maker Tod’s SpA, said on Italian television after Fiat purchased Chrysler. “And what is left of the family has an attitude I don’t like.”

    Elkann insists that Fiat has no desire to quit Italy, and that the company has added thousands of Italian jobs due to its global expansion. As Elkann works on Exor deals, he’s also supporting Marchionne’s campaign to merge Fiat Chrysler -- where he serves as chairman -- with another carmaker to forge a new No. 1 in the auto industry.

    Though their overtures have been rejected by their preferred partner, General Motors, the effort is emblematic of a new, broader vision for Agnelli’s heirs, according to Giuseppe Berta, the former head of Fiat’s archives.

    “Gianni’s main goal was to preserve the family’s industrial heritage as an Italian manufacturer,” Berta said.

With his global dealmaking push, “Elkann wants to make his heritage grow.”

 

Summary: His step sister is the ferrari of humans..

[Jurgis]

Just double checking: there are no ADRs or five-letter-F shares available on US exchanges for this?

 

Barron's had a positive mention this issue  ::)

[big_triece]

Attached is a great writeup on Exor from Greenwood Investors.

FCA__RACE__EXO_-_What_if_the_Market_is_Right__05a7ae4c6c.pdf

[benhacker]

Jurgis, I see "EXOSF"

 

Low volume, but seems real.

[nafregnum]

A video of a thesis for EXOR.  Got this link from a ZeroSum email.  There was also writeup in the August 2015 Manual of Ideas on EXOR -- the author was Gianluca Ferrari who is an analyst at Shareholder Value Management AG based in

Germany.  Both the YouTube video and the MoI writeup seemed to want to compare EXOR to names like Markel, Fairfax, 3G, and Berkshire.