Since my initial write up the extraordinary general meeting held on September 25th 2014 has approved the disposition of UMS (DE). Over the last couple of days the share price trended downwards. At the same time trading volume has been relatively high.
There have not been any significant changes to my investment thesis (at least as far as I am aware of). On a positive note, management expects a higher total payout to shareholders of EUR 11.1 per share compared to my estimate of EUR 10.9. However, the second expected payment to shareholders of roughly EUR 3.6 per share might be postponed to July 2017 in case the pending court trial and the liquidation of an Italian affiliate take longer than originally anticipated. Taking these two factors into consideration the expected IRR decreases by 80 bps compared to my initial analysis (IRR:10.7%).
However, the lower share price (currently at EUR 9.3) further increases the attractivness of this investment adding 320 bps to the originally expexted IRR. Therefore, I will add to my existing position starting from today until reaching a 3.5% portfolio share with a share price limit of EUR 9.40. I am currently holding a 2.5% portfolio position which I purchased at a volume weighted average price of EUR 9.63.
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