Yule Catto Share Discussion Threads

[cockneyrebel] 06/7/2011 12:27

Can't buy hardly any online - mm's running scared?

CR

[wanttowin] 06/7/2011 09:06

Whoops was it just a false rumour ?? Looks like I topped up on the high again..DOH Oh well I still have a great deal of faith in YC..

[retsius] 06/7/2011 07:37

@spob
Thanks for that.Hoping for some follow through in price today.

[spob] 05/7/2011 19:46

if this closes up tomorrow we have a breakout

[broadwood] 05/7/2011 17:24

Meanwhile IMI added 41p to £11.19 on vague rumours of a £15 to £16 a share bid for the engineer, while chemicals group Yule Catto climbed 11.1p to 241.1p after speculation of a link-up with US group Dow Chemicals, with a price of 350p to 370p mentioned. Germany's BASF has also been mentioned in the past as a potential predator

[dalesiders] 05/7/2011 17:13

Dow Chemicals rumour through the market like wildfire

[broadwood] 05/7/2011 17:03

Yule Catto, the chemicals company, is the latest subject of bid speculation.

The company's shares, which have performed well in recent weeks after positive earnings new, have jumped another 6.5%, up 14.9p to 244.9p, on talk of a possible 350p to 370p offer. US group Dow Chemicals was the name on traders' lips, although Germany's BASF has been mentioned in the past as a possible predator.

At 370p, the company would be valued at more than £1.2bn

[broadwood] 05/7/2011 16:58

(0)
Yule Catto, the chemicals company, is the latest subject of bid speculation.

The company's shares, which have performed well in recent weeks after positive earnings new, have jumped another 6.5%, up 14.9p to 244.9p, on talk of a possible 350p to 370p offer. US group Dow Chemicals was the name on traders' lips, although Germany's BASF has been mentioned in the past as a possible predator.

At 370p, the company would be valued at more than £1.2bn

[retsius] 05/7/2011 14:48

spob
Whats that all about?

[spob] 05/7/2011 13:32

from FT Alphaville blog today


NH we now have lots of spurious bid stories
Unilever PLC (ULVR:LSE): Last: 2,029, down 8 (-0.39%), High: 2,045, Low: 2,025, Volume: 694.61k
Yule Catto and Co PLC (YULC:LSE): Last: 244.20, up 14.2 (+6.17%), High: 249.40, Low: 227.80, Volume: 1.28m
NH that's today's bid story
BE Dow Chemical?
NH Yep, Dow Chemical offering 360/70p
NH and there's seems to be a trend developing here
NH find a UK mid cap
NH preferably an industrial
NH and say it could be acquired by someone in the US
NH slap a 30% premium on top
NH and off we go
NH (@Baz – fair point)
BE You're a tad cynical on this one, I detect.
NH I am
NH everyone heard the story at the same
NH time
NH and it whipped round the market
NH on the wires
NH everywhere
NH in fact the Unilever story was pretty much the same
NH as it happens
NH Yule Catto probably could be acquired
NH although I have no real idea of what it produces
BE Polymer Latex.
NH Our business is built around a comprehensive range of emulsion polymer dispersions and lattices based on vinyl acetate homo and co-polymers, pure and styrene acrylics, styrene and nitrile butadiene. In addition, we produce a range of low hydrolysis polyvinyl alcohol materials and a range of speciality products based on poly vinyl acetate. In Asia, we are also active in the manufacture of natural rubber dispersion and alkyd and polyester resins.
BE Yeah. Rubber for carpet backing
BE Textiles, foams, paper, coatings for stuff.
BE rubber gloves are apparently high growth.
NH I'm sure they are
NH in the elf & safety age
NH anyway
NH I don't rate the buying in this one
NH although I wouldn't rule it out
NH as for Reckitt
Reckitt Benckiser Group PLC (RB.:LSE): Last: 3,562, up 74 (+2.12%), High: 3,567, Low: 3,522, Volume: 1.12m
NH and a bid from Unilever well
BE .... well, it's been an idea that's been around for ages.
BE And the noise has been turned up since Bart exited.
BE There was an Oddo note pushing the Unilever/Reckitt combination very aggressively last week.
NH would the regulators let Unilever or P&G acquire it, though?
NH let's have a look at this note
BE P&G, I'd doubt.
BE But Unilever, maybe.
BE However, this was quite distinctly in the category of fantasy M&A.
NH (@squarepeg – depends which newspaper you read)
BE We deem the likelihood of a rapprochement between Unilever (Reduce – TP € 20) and
Reckitt (Buy – TP 4,000p) to be high. Such a deal makes sense: i/ this would be the best
combination in the home care segment, creating a world leader ahead of P&G and ii/ the
two groups are an extremely good business fit. Reckitt would provide the strength of its
power brands and Unilever access to emerging markets. The timing is good (de-rating
and departure of key managers from Reckitt) whilst Unilever's management team has the
credibility to pull off a transforming deal. A 5,000 pence per share offer would be earnings
enhancing in year one but destroy value out to year five. This scenario has by no means
been factored into forecasts, although it is sufficiently credible for the market to take
notice. RB (excl. Pharma) exhibits a premium of 12% in terms of 2012e EV/EBITA vs.
Unilever but is trading with a discount of 9% in terms of 2012e P/E. We think that
arbitrage is pertinent.
BE There's your £50 valuation again. Coincidentally.
NH lovely round number that
BE Note, this is dated Friday, June 24.
BE A Reckitt/Unilever tie-up offers the best combination in the event of sector
consolidation. This is the only deal that would create a world leader able to beat
P&G and edge ahead in Asia, Western Europe and Latin America. The new entity
would also have the most attractive product portfolio in the sector (power brands) and
the strongest exposure to emerging countries (>50%). Such a tie up would finally
enable Unilever to distinguish itself from P&G in mature countries and allow Reckitt to
make up substantial lost ground in emerging countries. Anti-trust barriers are not
insurmountable. An analysis by market category reveals that the home care sales of
the new entity that are exposed to genuine anti-trust risk are limited to a range of 6%
to 15%. The timing is favourable. The departure of a number of RB's top managers
has invalidated the principal of a lock down in the company control. Unilever's
management has the credibility to manage an acquisition which is set to be greater in
terms of cost (EV: € 45bn) than size (sales excl. RBP of € 11bn). Jean-Marc Huet is a
deal maker and also the best placed CFO to manage the future of Reckitt Pharma
(RBP).
NH hmmm
BE 5,000 pence offer would appear necessary. A 5,000 pence per share offer from
Unilever (50% premium), of which 80% in cash is credible, in our view, and would
value RB's core business (excl. RBP) at 2012e P/E of 21x and 2012e EV/EBITDA of
16x. After the divestment of RBP we value the group at £ 3bn (with a generic arriving
in Q1 2012e) as a base case scenario, with Unilever's 2012e net debt/EBITDA
standing at 3x, the impact would be slightly earnings enhancing on 2012e EPS but
ROIC on the deal is set to remain at < 8% until year five, which is not unusual in the
industry (Gillette, Numico, Cadbury, etc.).
BE So – a value destructive deal.
BE But one Unilever would need to do just to survive
BE Against P&G, which would otherwise eat its lunch.
NH well there is an argument that the only way Unilever can catch up
NH is with a big acquisition
NH and the CEO has been there long enough now
NH to make a move
NH well that's what Liberum reckon
BE Go on.
NH With the recent senior management changes, CEO Polman is now shifting his focus from the hardware to
the software side of Unilever or, in other words, from distribution/infrastructure to content (where he will
have a more hands on role). We think this says that after 2.5 years at the helm he is more comfortable with
the company's on the ground execution capabilities and now wants to further enhance the strategic
thrusts of "bigger, better, faster innovation", global marketing, and the tapping of white space
opportunities. In this regard, the changes are encouraging.
NH Although we do not see a link between these
changes and recent M&A speculation, we do continue to believe that M&A will play a larger role in the
future (a sale of the Food ex tea/ice cream unit and further leverage could raise $45-55 billion), with more
focus on personal care than laundry/home (owing to faster growth potential, and opportunities to "margin
up"); in this sense we continue to see as logical targets Colgate, Beiersdorf, and or a cosmetics company,
and rule out companies like Reckitt Benckiser, Clorox, SC Johnson, and Church & Dwight
NH Adjusting for
the HUL minorities (but not for the €3.5B pension deficit as that is stock market related rather than FCF
related) we see UNA trades at 8.5x 2012 EV/EBITDA compared with 9.5x for Danone and 11x for Nestle
(10.2x ex OR). Our target price of €29 values UNA at 10x 2012 EBITDA (a multiple of 11x would be justified
further out if UNA can consistently deliver better top line growth than BN/NESN and post gradual margin
expansion; at 11x 2013 EBITDA the stock would be worth €35 by Dec 2012).
BE (@Monkey: true, but it's just catch up. And entirely expected following Scottish Power doing the same two months ago. Apparently the application/alert process for hiking your tariffs is 6 weeks.)
BE Sorry – distracted.
BE So – is there anything else out there, bar these retreads?
NH nothing much really, apart from the fact that there is supposed to be a big FTSE 100 bid out there
NH apparently coming before the summer hols
NH so prepare for weeks of speculation
NH as we all try to guess the big one

[jange] 05/7/2011 13:22

I would have thought that YULC would have to something fairly shortly even if it is to deny the rumours. These speciality chemical companies all seem to be doing rather well. Croda is remarkable as is Elementis.

[wanttowin] 05/7/2011 13:06

Oooooh First bought in here about 8 months ago, and all that time been fairly happy with its very slow but steady progress ( especially compared to many others ) But now excitement has come to the fore ! please please please bring it on !

[kimball808] 05/7/2011 12:55

you never know, they might just be typing the RNS as we speak...;-)

[wanttowin] 05/7/2011 12:51

Cannot ignore the news, just topped up, I know, I know, should be doing it on the lows...but if the rumours are true? up up and away !!

[mundaka] 05/7/2011 12:19

It is a delayed trade from yesterday 16:16 is the time it was executed, could be a buy or a sell depending on the price at the time. Large trades are often reported later.

[wanttowin] 05/7/2011 12:03

Can anyone tell me what the late 75,000 sell at 226 means? Surely it was a long time ago when we were at that price? Puzzled

[wanttowin] 05/7/2011 11:53

Wow great news Kimball....Let the good times roll !!

[kimball808] 05/7/2011 11:47

a bit more meat for the bones...

[gswredland] 05/7/2011 11:22

Thanks Kimbal.

[jange] 05/7/2011 10:50

I seem to remember there was talk of a bid before the rights issue. Possibly BASF. Probably rubbish as most bid rumours are but nevertheless a good rise.