CHARGEURS : Chargeurs, the rationale behind a takeover bid

On Friday, Chargeurs announced a takeover bid for itself. Columbus Holding, controlled by Michaël Fribourg, Chairman and CEO of Chargeurs, which currently holds 30% of Chargeurs’ voting rights, is to launch a takeover bid to garner more than 50% of Chargeurs while retaining a listing. With an offer at a 50.5% premium compared to the last three months, Chargeurs sends a signal to the market about its value.

• The companies Colombus Holding and (newly formed) Colombus Holding 2, controlled by Michaël Fribourg, Chairman and CEO of Chargeurs, will launch a takeover bid for the shares of Chargeurs without looking for a delisting.
• To date, Colombus holds 26.5% of Chargeurs and 29.5% of Chargeurs’ voting rights.
• The offer price of €12 per share represented a premium of 36.22% over last month’s average share price and 50.5% over the last three months.
• The Board of Directors has welcomed this transaction, which remains subject to the opinion of the employee representative bodies and the independent expert’s report.

Colombus with currently close to 30% of the voting rights in Chargeurs (26.5% stake) announced on Friday, 15-12-2023, its intention to launch a bid to garner more than 50% (50% + 1 share at least) of Chargeurs. Yet, it intends to retain a listing “with a significant level of free float to ensure solid liquidity of the shares”. The planned offer at €12 is at a 36% premium to the last month’s average and corresponds to a 50.5% premium to the last three months’ average. Colombus is ultimately controlled by Chargeurs’s Chair and CEO with the support of the Dassault family office. For the purpose of this deal, a Colombus 2 is being set up, bringing together in capital alongside the Fribourg family the historic partners, i.e. the Habert-Dassault family and BNP Paribas Development, as well as new partners including MACSF and CARAC. If the transaction does not result in the acquisition of more than 50% of the capital or voting rights, the offer will lapse.

Michaël Fribourg explained that the market environment for small and mid-cap stocks is difficult with the high volatility. This is an environment that he believes is adding unwarranted strong downward pressure on Chargeurs’ share price, making it difficult to develop a long-term strategy. In fact, Chargeurs sees 2024 as a transitional year, with a new strategic plan not due to be launched until 2025, with genuine changes expected in 2030-35. A structuring M&A operation in the near future is therefore no longer topical. All the above considerations explain Michaël Fribourg’s determination to strengthen his grip on the stock. With a clear majority control, Michaël Fribourg would be able to fully implement his vision and, who knows, perhaps execute a complete turnaround away from its existing assets from 2025 onwards. The strategic review is unlikely to be released before late 2024 and for now the addition of luxury assets as part of a business reshuffling is dropped.

All in all, if it is true that Chargeurs is showing resilience in a difficult environment, the rebound of its businesses is set to take time. In this sense, we see the tender offer as a liquidity opportunity for minority shareholders. In addition, the operation sends a signal to the market: Chargeurs believes in its stock and considers the market’s sanctions too severe.

This news has no impact on our estimates, although we expect modest growth and a rebound, with 2025 sales below Chargeurs’ €1bn target.