Zegona Communications Share Discussion Threads

[cerrito] 22/4/2020 19:11

dividend.
hxxps://www.euskaltel.com/webektest/GaleriaCorporativo/Documentos/hechos_relevantes/2020/resultados-1t2019-en.pdf
Q1 results presentation released today I think after market close.
They maintain 2020 guidance and 2019 dividend payment.
My quick read is that nothing here to materially move the EUS share price either way.
They have a conference call tomorrow 12 noon London time..not sure if I will make it.

[cerrito] 13/4/2020 22:41

In my view good for all concerned that Invesco are exiting as per their RNS of the 8th going down from 7.3% to 3.1%.
On March 30 Euskaltel issued an update and said
quote
To date, the company has not experienced any significant impact on its main financial metrics. The
company continues to monitor financial trends in order to ascertain any business impacts.
unquote
They are publishing their first quarter results next Wednesday with a conference call on Thursday.
Be interesting to see how widespread in Spain the cutting of dividends is. Their net debt;ebitda of 4.3x suggests they may want to count their pennies.Their March 30 trading update indicated as one would expect the home market which is 5x the revenue of b2b going very well and b2b very badly but need to wait till next week how that is all reflected in the bottom line. Their share price remains at E7.
I do not see myself doing anything till we get Q1 figures.

[the ghost who walks] 06/4/2020 21:46

Is this on a discount to the investment in eusaketil? 180mln mkt cap. Stake in the Spanish thing is about the same? No other assets?

[cerrito] 29/3/2020 22:01

There are several other similar links to a twitter handle but they never seem to have any relevance to the company in question.

[dekle] 29/3/2020 14:15

What are they saying? I don’t tweet

[cerrito] 28/3/2020 17:44

I had rather a delayed run through here.
I see that the EUS share price has recovered from a low of E6 a couple of weeks back to E7 as of yesterday#s close. This gives EUS a marcap of E1248m and Zeg’s 21% share to be worth E262m or E235m.
If you say that ZEG has £25m of other net assets that gives total assets if ZEG of £260m or £1.18 per share.
EUS had a decent 2019 performance and paid in February the same interim dividend that it had done the year before.
Makes sense to me that ZEG does share buy backs given the discount to NAV but do not see myself as buying more-and no desire to sell.
Feel free to check my maths

[quiggers3112] 14/2/2020 22:40

Looks attractive due to the NAVPS but to invest in ZEG means looking in detail at EUS. The B/S looks decidedly uninteresting from a balance sheet valuation. Too risky for my liking without a detailed analysis. Is EUR 8.37 fair value? I have no idea!

[cerrito] 14/2/2020 22:05

The E303.5m would be the then market value of the EUS shares that ZEG held at the time.
Given that Zeg was announcing purchases as recently as the day before yesterday and has plenty of headroom no idea why the price fell this afternoon.

[quiggers3112] 13/2/2020 22:16

ZEG B/S 30/6/19 88% of net assets are EUS investment valued at EUR 303.5m.
EUS B/S q319 shows neg. equity of EUR -337.3m when intangibles are stripped out.

Why would anyone invest in that? I`m clearly missing something...
How has that 303m valuation been calculated? Anyone.
Q

[cerrito] 31/1/2020 11:59

Thanks for that Tiltonboy.
Incidentally I thought that the IR pages on the EUS website very good.

[tiltonboy] 30/1/2020 22:50

Cerrito,

That looks pretty much spot on.

Artemis are a holder of EUS, and mentioned them on their weekly note, last week.

I was disappointed that neither MVI or ZEG were the buyers of lines of stock that went through yesterday.

[cerrito] 30/1/2020 21:48

The prize for the most uncooperative IR department must go to Zegona.
I am looking at getting back into these as I have had a good experience in the past and looking to get Soanish exposure.
Trying to work out the current value of their net assets, I emailed them asking them to send me the total number of shares in Euskaltel they own.
An easy enough question but they pointed me to their December 2 RNS.
I gather from their website that EUS have 178m shares which as a 21.3% holder would give Zeg37.9m shares which at today’s share price of E8.6 gives us E326m. Add to this other net assets of E25m gives us E351m. At today’s exchange rate of 0.84 that gives us £295m.
Also unhelpfully Zeg in their share buy back RNS do not give us the total shares outstanding but I got 220m from the ZEG website.
This give us NAV per share of £1.34.
I had expected it to be lower than the December 2 RNS figure given both the fall in the EUS share price and the strengthening of the £ against the Euro.
First appreciate if people can check my maths.
If my maths are correct, this is still a decent discount. My question to myself if it is big enough for me to get involved in the Spanish telco market-the last time I came across it was 10 years ago or so when I was a shareholder in VOD who were then complaining of very thin profitability in the then Spanish mobile market.
I see that two Basque banks have 20% shareholdings in EUS –no surprise as they were founding shareholders- and there is some speculation in the Spanish press that they want out. I have no idea if that is true and if true what effect it would have on the share price
Also will the discount between ZEG’s share price and the NAV narrow or widen? Not an academic question given the largest shareholder with 19% is MVI and there must be questions on its viability.
Views welcome

[mach100] 17/1/2020 10:19

What's weird about that dekle? Has the price changed? They are embarking on a share buyback programme.The amount in each trade may change if there is substantial share price movement but the final total will be £10 million should they see it through.

[dekle] 16/1/2020 08:47

Weird, the last 2 releases have reported an identical number of shares purchased. Weird because it is the same odd number. i.e. 207383

[mach100] 07/1/2020 10:07

Starting to move up though the share buyback has not yet begun. I expect a further couple of pence on the ask once the buyback starts in earnest.

[elgordo] 04/8/2019 12:48

"Virgin signs deal to reign in Spain as Richard Branson strikes pact worth millions of pounds"

[sharesoc] 16/7/2019 11:27

The Zegona presentation from our recent London company seminar can be found in our members area here:
There is also a seminar report.

To access the presentation, you'll need to be a full member of ShareSoc, which is a not-for-profit organisation that supports individual shareholders and campaigns for shareholder rights. If you're not already a member you can join here:

Once you've joined, you'll receive an invitation to register for our "members network" private social network, from where you'll be able to access the presentation (and presentations on 100s of other meetings). If you're already a member and have any difficulty accessing the report, please do not hesitate to contact us here:

[sharesoc] 02/7/2019 12:09

Zegona present at our London growth company seminar on the 10th July. If anyone is interested, you can book your place here:

[bandit99] 07/12/2018 12:06

I am not clear what their thinking is here: are they planning to launch a full bid evenually or hoping to sell out at a profit to another bidder? Any thoughts?

[dekle] 01/12/2018 07:55

I presume ZEG will be making a placing to have the funds available to acquire the additional shares but I haven't seen any reference to any offer?

[skyship] 20/10/2018 13:55

Perhaps no PIs in this stock anymore! Might ZEG be rather good value now?

[glasshalfull] 30/8/2017 20:45

Surprised zero posts today on news of the tender offer. Shares +6% on the day but remain at a 10% discount to the tender price.

Shareholders will have the opportunity to tender 36% of their holding at minimum of £2.00, however if the Euskatel price rises from the current £7.99 (~Euro 8.59) then they will adjust the volume of shares bought back BUT conversely increase the purchase price by 14p for every £1 increase in the value of each Euskaltel share up to a max of £4.

The £2.00 purchase price will not be lowered if the Euskatel price falls back from £7.99 per share.

Qualifying shareholders are those on the register on 20th September 2017 with payment expected to be credited on/around 16th October 2017.

Extract from offer document: -

"...the Board confirms today the launch of the Tender Offer, pursuant to which up to £140 million will be returned to Qualifying Shareholders by way of a tender offer at a price of at least £2 per Share.

The Directors have sought to structure the Tender Offer in such a way as to ensure that all Qualifying Shareholders will receive a pro-rata distribution of cash proceeds resulting from the sale of Telecable. Accordingly, each Qualifying Shareholder may only tender their Tender Offer Entitlement.

The Tender Price will be subject to upwards adjustment as described in paragraph 3.1 of Part I of this Circular. If the Tender Price is determined to be £2 per Share, each Qualifying Shareholder will be permitted to tender approximately 36 per cent. of their Shares.

If all Shareholders participate, £140 million will be returned to Shareholders and 70 million Shares will be repurchased in aggregate. This represents 42 per cent. of the Company's market capitalisation of £330 million 1 .

If the Tender Price is determined to be above £2 per Share, each Qualifying Shareholder's Tender Offer Entitlement will be reduced, meaning each participating Shareholder will still receive the same amount of cash but will sell fewer Shares. If all Shareholders participate, £140 million will still be returned but fewer Shares will be repurchased."

Kind regards,
GHF

[dekle] 07/8/2017 10:43

Thanks EIGordo for your confirmation. I thought I understood the company's statement and surprised to receive the notice from Selftrade of the dividend payment rather than the usual corporate action message.

[elgordo] 07/8/2017 09:43

Delke, the notice you received from your broker will have simply been a summary restating what was announced by the company in the 26/07 RNS.

As you said in post 66, they are not proposing to pay a dividend of 71p per share, they are planning a tender offer - i.e., to buy back shares from current holders (possibly at a small premium to the market price at the time it is announced), for a total consideration of £140m.

As for the timing, all we know so far is that it will first require a general meeting, yet to be convened and so date as yet unknown.