Parsad Posted November 22, 2024 Posted November 22, 2024 7 hours ago, Viking said: Well, at least this is good news for Recipe and their +1,000 restaurants in Canada. Does Prem have Trudeau’s ear? “The government is proposing that the GST/HST be fully and temporarily relieved on holiday essentials, like groceries, restaurant meals, drinks, snacks, children’s clothing, and gifts, from December 14, 2024, to February 15, 2025.” The GST on restaurant meals in Canada is 5%. More for provinces with the HST (harmonized federal and provincial taxes). So this is a meaningful reduction. - https://www.canada.ca/en/department-finance/news/2024/11/more-money-in-your-pocket-a-tax-break-for-all-canadians.html# The current federal Liberal government has to be the worst federal government in Canadian history - at least in my lifetime. And we have had some bad ones. The current $250 cheque per adult + 2 month tax break (on a few things) is just the latest in their bat shit crazy management of the Canadian economy, especially over the past 6 or 7 years. I have tried to keep away from politics - but this Liberal government just keeps setting new lows. I am completely dumbfounded by what they say and do. Fortunately, Canada is less than 12 months away from a federal election - my only hope is that Trudeau stays on as leader of the Liberals. PS: My family will now be getting cheques for 5 x $250 = $1,250. Money we do not need. I suppose i should be celebrating… +1! I don't want to vote for the Conservatives or NDP...equally batshit crazy when it comes to policy and outcomes...but I can't vote for Trudeau. I didn't in the last election, and I can't do it this time either. All three parties like the Democrats and Republicans are now spend, spend, spend or cut taxes which will reduce revenues...no one cares about a deficit or the national debt! Cheers!
Xerxes Posted November 22, 2024 Posted November 22, 2024 1 hour ago, Parsad said: +1! I don't want to vote for the Conservatives or NDP...equally batshit crazy when it comes to policy and outcomes...but I can't vote for Trudeau. I didn't in the last election, and I can't do it this time either. All three parties like the Democrats and Republicans are now spend, spend, spend or cut taxes which will reduce revenues...no one cares about a deficit or the national debt! Cheers! that leaves the Block !
Parsad Posted November 22, 2024 Posted November 22, 2024 1 hour ago, Xerxes said: that leaves the Block ! Can't vote for them. Irony is they've also always been batshit crazy until recently and now may be the most sane of the four parties. Although if I move to a beautiful cottage outside of either Quebec City or Montreal on some acreage, it might be worth voting for them. I'm thinking about it! Cheers! 1
dartmonkey Posted November 22, 2024 Posted November 22, 2024 10 hours ago, Parsad said: I don't want to vote for the Conservatives or NDP...equally batshit crazy when it comes to policy and outcomes...but I can't vote for Trudeau. I didn't in the last election, and I can't do it this time either. All three parties like the Democrats and Republicans are now spend, spend, spend or cut taxes which will reduce revenues...no one cares about a deficit or the national debt! You are like my son, then. He finds something to disagree about with both the Liberals and the Conservatives, so he won't vote. (He doesn't like that the conservatives have not promised to eliminate supply management for milk, eggs and poultry.) The fact that the conservatives would be a more sensible choice than the liberals for 90% of the issues he cares about doesn't matter to him. For the deficit, the liberals would keep increasing spending, make nonsensical cuts to taxes (GST holidays, exempting arbitrary items, etc.) and increase income and capital gains taxes, with an increasing deficit, while the conservatives would cut spending, and cut a few taxes (the carbon tax, which provides no net income to the government), and maybe cut corporate and capital gains taxes, reducing the deficit but not eliminating it, at least not in the short term. So if I want the deficit completely eliminated (as I do), I have no party to vote for, right? Or I could vote for the conservatives, and get 90% of what I want. They're all batshit crazy, but some are more batshit crazy than others.
Xerxes Posted November 22, 2024 Posted November 22, 2024 11 hours ago, Parsad said: Can't vote for them. Irony is they've also always been batshit crazy until recently and now may be the most sane of the four parties. Although if I move to a beautiful cottage outside of either Quebec City or Montreal on some acreage, it might be worth voting for them. I'm thinking about it! Cheers! if you are ever in QC for a visit, do let me know. I ll arrange to meet with you.
Viking Posted November 23, 2024 Posted November 23, 2024 (edited) Orla Mining - Planting a Seed Orla Mining is Fairfax’s newest large resource/commodity investment. Fairfax quietly built up their position in Orla over the past 2 years (from Q3-2022 to Q3-2024), spending about $217 million. They own about 18% of the company. The investment today has a market value of US$261 million. The return on Fairfax’s investment to date has been about $44 million or 20%. The real play with this investment: That gold prices stay higher for longer. That the management team at Orla is above average. And will be able to expand the company from a single asset producer to a multi asset intermediate-sized producer. That the strong ownership structure (Fairfax, Newmont, Lassonde, Agnico Eagle) will also provide to be a competitive advantage. This allows the management team at Orla to be strategic and think long-term with its decisions. This should help ensure that the capital allocation decisions made by the management team at Orla are rational and very shareholder friendly (which is what we have seen with Orla's most recent acquisition). With its investment in Orla, Fairfax has planted another seed in its large equity portfolio. This investment has significant upside potential in the coming years. And if gold prices stay elevated, it could turn into a home run (a multi-bagger). Orla recently made a large acquisition - the Musselwhite gold mine in Canada. As part of the financing, Fairfax invested (not sure how much) in the US$200 million convertible note issuance: Coupon: 4.5%; Premium: 42%1; Term: 5 years Convertible at C$7.90 18-month non-call, callable at 130% of strike thereafter Warrant: 0.66x warrant exercisable at C$11.50 – Five-year term from closing This is likely a significant increase in the size of Fairfax’s investment in Orla Mining. The purchase of Musselwhite looks like another solid move by the Orla management team. There appears to be significant optionality to the purchase (significant opportunity for resource growth, which is part of the Pierre Lasonde playbook). Who is Orla Mining? Orla Mining Ltd. is a Vancouver-based company that acquires, explores, develops, and operates mineral properties to produce gold, silver, zinc, lead, and copper: Orla Mining's projects include: Camino Rojo: A 100% owned, operating oxide heap leach mine in Zacatecas, Mexico South Railroad: A feasibility-stage heap leach project in Nevada Cerro Quema: A pre-feasibility-stage heap leach project in Panama Musselwhite Gold Mine: An acquired project in Ontario, Canada CEO: is Jason Simpson, who has over 27 years of experience in mining engineering, project construction, and operations leadership. Non-Executive Chairman, Director: Mr. Jeannes served as President and Chief Executive Officer of Goldcorp Inc. from 2009 until April 2016. Orla recently announced a large acquisition: the Musselwhite Gold Mine Strategic expanansion into Canada. No upfront equity dilution, supported by cornerstone shareholders. Takes advantage of significant disconnect between forward and consensus gold prices. Significant opportunity for resource growth. https://orlamining.com/site/assets/files/6118/orla_acquires_musselwhite_nov_18_2024.pdf Bet on the jockey/partnering with outstanding investors It should be noted that Fairfax is not blindly throwing darts with their resource/commodity investments. They are partnering with other highly successful people / investors - some of whom have extraordinary long term track records. With Orla, Fairfax is partnering with Pierre Lassonde who is ‘recognized as one of Canada’s foremost experts in the area of mining and precious metals.’ Lassonde co-founded Franco-Nevada in 1985. Fairfax is also partnered with Lassonde with its investment in Foran Mining, a copper mining project in Canada. Jurisdiction The vast majority of the production for Fairfax’s resource/commodity investments is located in North America. This is a much lower risk jurisdiction than other parts of the world. My guess is this is not a fluke. All of Orla’s mines are located in North America. Edited November 23, 2024 by Viking
nwoodman Posted November 23, 2024 Posted November 23, 2024 (edited) 2 hours ago, Viking said: Orla Mining - Planting a Seed Orla Mining is Fairfax’s newest large resource/commodity investment. Fairfax quietly built up their position in Orla over the past 2 years (from Q3-2022 to Q3-2024), spending about $217 million. They own about 18% of the company. The investment today has a market value of US$261 million. The return on Fairfax’s investment to date has been about $44 million or 20%. The real play with this investment: That gold prices stay higher for longer. That the management team at Orla is above average. And will be able to expand the company from a single asset producer to a multi asset intermediate-sized producer. That the strong ownership structure (Fairfax, Newmont, Lassonde, Agnico Eagle) will also provide to be a competitive advantage. This allows the management team at Orla to be strategic and think long-term with its decisions. This should help ensure that the capital allocation decisions made by the management team at Orla are rational and very shareholder friendly (which is what we have seen with Orla's most recent acquisition). With its investment in Orla, Fairfax has planted another seed in its large equity portfolio. This investment has significant upside potential in the coming years. And if gold prices stay elevated, it could turn into a home run (a multi-bagger). Orla recently made a large acquisition - the Musselwhite gold mine in Canada. As part of the financing, Fairfax invested (not sure how much) in the US$200 million convertible note issuance: Coupon: 4.5%; Premium: 42%1; Term: 5 years Convertible at C$7.90 18-month non-call, callable at 130% of strike thereafter Warrant: 0.66x warrant exercisable at C$11.50 – Five-year term from closing This is likely a significant increase in the size of Fairfax’s investment in Orla Mining. The purchase of Musselwhite looks like another solid move by the Orla management team. There appears to be significant optionality to the purchase (significant opportunity for resource growth, which is part of the Pierre Lasonde playbook). Who is Orla Mining? Orla Mining Ltd. is a Vancouver-based company that acquires, explores, develops, and operates mineral properties to produce gold, silver, zinc, lead, and copper: Orla Mining's projects include: Camino Rojo: A 100% owned, operating oxide heap leach mine in Zacatecas, Mexico South Railroad: A feasibility-stage heap leach project in Nevada Cerro Quema: A pre-feasibility-stage heap leach project in Panama Musselwhite Gold Mine: An acquired project in Ontario, Canada CEO: is Jason Simpson, who has over 27 years of experience in mining engineering, project construction, and operations leadership. Non-Executive Chairman, Director: Mr. Jeannes served as President and Chief Executive Officer of Goldcorp Inc. from 2009 until April 2016. Orla recently announced a large acquisition: the Musselwhite Gold Mine Strategic expanansion into Canada. No upfront equity dilution, supported by cornerstone shareholders. Takes advantage of significant disconnect between forward and consensus gold prices. Significant opportunity for resource growth. https://orlamining.com/site/assets/files/6118/orla_acquires_musselwhite_nov_18_2024.pdf Bet on the jockey/partnering with outstanding investors It should be noted that Fairfax is not blindly throwing darts with their resource/commodity investments. They are partnering with other highly successful people / investors - some of whom have extraordinary long term track records. With Orla, Fairfax is partnering with Pierre Lassonde who is ‘recognized as one of Canada’s foremost experts in the area of mining and precious metals.’ Lassonde co-founded Franco-Nevada in 1985. Fairfax is also partnered with Lassonde with its investment in Foran Mining, a copper mining project in Canada. Jurisdiction The vast majority of the production for Fairfax’s resource/commodity investments is located in North America. This is a much lower risk jurisdiction than other parts of the world. My guess is this is not a fluke. All of Orla’s mines are located in North America. Good one @Viking, Musselwhite is straight from the Lassonde playbook: “1. Quality Jurisdiction Musselwhite is located in Ontario, Canada, a Tier-1 jurisdiction with a rich history of mining. This aligns with Lassonde’s emphasis on safe, predictable operating environments. With Orla’s existing projects in North America (Mexico, Nevada, Panama), this acquisition reinforces their focus on stable regions with excellent infrastructure and skilled labor. 2. Untapped Exploration Potential Musselwhite brings significant optionality to Orla’s portfolio: • The mine has historically underexplored deeper zones and extensions of known ore bodies. • The Superior Province, where Musselwhite is located, is one of the world’s most prolific greenstone belts, offering substantial upside for resource expansion. This exploration potential is quintessential Lassonde: invest in an asset with a solid production history and use exploration to unlock long-term value. 3. Strategic Capital Allocation Orla financed the acquisition with a mix of convertible notes and warrants, avoiding upfront equity dilution. This disciplined approach mirrors Lassonde’s focus on maximizing shareholder returns by maintaining ownership leverage while ensuring sufficient funding for growth. With cornerstone investors like Fairfax, Newmont, and Agnico Eagle, Orla also has the financial backing to execute this strategy effectively. 4. Strong Operational Foundation Unlike a greenfield project, Musselwhite is an established mine with a proven production record. Orla inherits a functioning operation with existing infrastructure, immediate cash flow, and opportunities for optimization. This de-risks the acquisition while setting the stage for growth—a hallmark of Lassonde’s playbook. 5. Long-Term Upside in Gold Prices Musselwhite adds another layer of leverage to gold price movements. Lassonde has often emphasized the disconnect between market and intrinsic valuations of gold, advocating for investments in assets that can thrive in both low- and high-price environments. If gold prices remain elevated, Musselwhite’s margins and reserves will compound Orla’s value exponentially.” It is fascinating to watch all this come together and you can see the themes and influences of prior investments and importantly the key figures involved. Reminds me I need to read Lassonde’s The Gold Book. https://archive.org/details/goldbookcomplete0000lass/page/n3/mode/2up Edited November 24, 2024 by nwoodman
Parsad Posted November 24, 2024 Posted November 24, 2024 On 11/22/2024 at 10:08 AM, Xerxes said: if you are ever in QC for a visit, do let me know. I ll arrange to meet with you. Thanks Xerxes...will do! Cheers!
glider3834 Posted November 24, 2024 Posted November 24, 2024 Ki https://ki-insurance.com/news/future-of-ai-in-underwriting Seaspan https://www.seatrade-maritime.com/ship-management/seaspan-and-one-ship-management-jv-a-natural-progression Grivalia https://news.gtp.gr/2024/06/26/op-ed-the-incentive-for-investments-in-greece-has-never-been-stronger-george-chryssikos-grivalia-hospitality/
nwoodman Posted November 25, 2024 Posted November 25, 2024 3 hours ago, glider3834 said: Ki https://ki-insurance.com/news/future-of-ai-in-underwriting Seaspan https://www.seatrade-maritime.com/ship-management/seaspan-and-one-ship-management-jv-a-natural-progression Grivalia https://news.gtp.gr/2024/06/26/op-ed-the-incentive-for-investments-in-greece-has-never-been-stronger-george-chryssikos-grivalia-hospitality/ They might have lightning in a bottle with Ki . Different insurance type, but Lemonade, an “AI Insuretech” is sitting at a lazy $3.5 bn and hasn’t turned a profit. Hmmm The MS take away from their investor day gives you a flavour of how heady the space is. Meanwhile Ki and for that matter Fairfax just do! LEMONADE_20241120_0501.pdf
glider3834 Posted November 25, 2024 Posted November 25, 2024 2 hours ago, nwoodman said: They might have lightning in a bottle with Ki . Different insurance type, but Lemonade, an “AI Insuretech” is sitting at a lazy $3.5 bn and hasn’t turned a profit. Hmmm The MS take away from their investor day gives you a flavour of how heady the space is. Meanwhile Ki and for that matter Fairfax just do! LEMONADE_20241120_0501.pdf 538.33 kB · 5 downloads They are also trying to create more separation bw Ki and Brit which is interesting - Ki have hired new CFO, new HR Director, new Gen Counsel https://www.insuranceinsider.com/article/2dp3nldeatj2g1rym7ncw/london-market/ki-moves-to-carve-out-greater-separation-from-brit https://ki-insurance.com/news/https://ki-insurance.com/news/
Viking Posted November 25, 2024 Posted November 25, 2024 38 minutes ago, glider3834 said: They are also trying to create more separation bw Ki and Brit which is interesting - Ki have hired new CFO, new HR Director, new Gen Counsel https://www.insuranceinsider.com/article/2dp3nldeatj2g1rym7ncw/london-market/ki-moves-to-carve-out-greater-separation-from-brit https://ki-insurance.com/news/https://ki-insurance.com/news/ @glider3834, thanks for bringing this forward. Ki had kind of fallen off my radar. Yes, it certainly looks like they are getting ready for something…. ————— 20TH MAY 2024 Ki welcomes Jan Christiansen as Chief Financial Officer Ki is excited to have Jan on board to set us up for long-term success. Jan’s role will centre around leading the growing financial function for Ki as well as being a key driver across transformation projects that will shape the strategic direction of the business. Previously to joining Ki, Jan garnered a wealth of experience in financial services businesses across the globe. Most notably he spent 20 years with Fairfax, Ki‘s lead shareholder, including 14 years as Chief Financial Officer for the Odyssey Group. Jan feels that “Ki’s unique value proposition is a once-in-a-lifetime chance to help shape the strategic direction of a business with seemingly endless possibilities. I find the culture at Ki to be very special. The positive atmosphere is contagious and inspires creative thinking, something I believe is critical to our success”.
nwoodman Posted November 25, 2024 Posted November 25, 2024 51 minutes ago, glider3834 said: They are also trying to create more separation bw Ki and Brit which is interesting - Ki have hired new CFO, new HR Director, new Gen Counsel https://www.insuranceinsider.com/article/2dp3nldeatj2g1rym7ncw/london-market/ki-moves-to-carve-out-greater-separation-from-brit https://ki-insurance.com/news/https://ki-insurance.com/news/ Good stuff, lot of value there at the moment if they spin it out
Hoodlum Posted November 25, 2024 Posted November 25, 2024 Eurobank announced today that they have increased the remaining share purchase price for Hellenic Bank from €4.58 per share to €4.84 per share with Demetra selling all of their remaining shares. This brings Eurobanks ownership in Hellenic bank to 93.47% and will allow for the delisting of Hellenic Bank. In the new year, Eurobank will issue one last final public offer at €4.84 per share to the remaining shareholders. https://en.protothema.gr/2024/11/25/eurobank-acquires-93-47-of-hellenic-bank/
nwoodman Posted November 25, 2024 Posted November 25, 2024 (edited) 1 hour ago, Hoodlum said: Eurobank announced today that they have increased the remaining share purchase price for Hellenic Bank from €4.58 per share to €4.84 per share with Demetra selling all of their remaining shares. This brings Eurobanks ownership in Hellenic bank to 93.47% and will allow for the delisting of Hellenic Bank. In the new year, Eurobank will issue one last final public offer at €4.84 per share to the remaining shareholders. https://en.protothema.gr/2024/11/25/eurobank-acquires-93-47-of-hellenic-bank/ Superb! So played out something like this: Edited November 25, 2024 by nwoodman
Viking Posted November 25, 2024 Posted November 25, 2024 (edited) Peak Achievement Athletics - The rebuild has been completed On February 28, 2017, Fairfax partnered with Paul Desmarais III and his team at Sagard Holdings to purchase Performance Sports Group out of bankruptcy for total proceeds of US$575 million. The company was subsequently renamed Peak Achievement Athletics. Performance Sports Group was a leading developer and manufacturer of sports equipment: Hockey - Bauer (#1 player) https://ca.bauer.com Baseball - Easton (#3 player) Lacrosse - Cascade and Maverik (combined, #1 player?) https://cascademaverik.com Performance Sports Group completes sale of substantially all of its assets to investor group led by Sagard and Fairfax Financial - Article from Feb 27, 2017 https://www.torys.com/en/work/2016/10/52382aeb-7e85-42dd-903c-309be9bb261a Why did Performance Sports Group go into bankruptcy? The primary problem wasn’t the business. It was the management team in place at the time - their decisions were terrible (changing their distribution strategy in Canada for Bauer and grossly overpaying for Easton are just two examples). Click the link below for details. Behind the bankruptcy of Performance Sports Group - Article from November 10, 2016 https://www.nhbr.com/behind-the-bankruptcy-of-performance-sports-group/#:~:text=Graeme%20Roustan%2C%20who%20blames%20the,time%20to%20arrange%20a%20sale. Details of the partnership In 2017, Fairfax and Sagard each invested $154 million (C$204 million). Each company held a 42.6% equity interest and 50% of the voting rights in Peak. The investment was accounted for using the equity method. It was not disclosed who owned the remaining 14.8% equity position in Peak. It is interesting that Performance Sports was purchased for total consideration of $575 million and Fairfax and Sagard only invested a total of $308 million (for their 85.2% interest). Who is Sagard Holdings? Sagard is a global multi-strategy alternative asset management firm active in venture capital, private equity, private credit, and real estate. https://www.sagard.com Sagard was launched in 2002 by the Desmarais family, which controls Montreal-based financial services giant Power Corp. of Canada. The aim was to invest in entrepreneurs and support the growth of middle-market businesses there. Fairfax has built out a wonderful capital allocation platform When deciding what to do with its $69 billion investment portfolio, Fairfax has build out an exceptionally diverse platform within the company that allows it to go to where the opportunity is at any given point in time - in public or private markets. In the case of Peak, Fairfax invested in the private market and like an alternative asset management firm. Fairfax’s partnership with Sagard is another good example of the many partnerships/relationships that Fairfax has been patiently building out over their 38 years of existence as a company. The benefits of what Fairfax has created are far reaching (future deal flow being just one example). The key take-away is Fairfax is extremely flexible with its capital allocation framework. This should lead to better diversification (lower portfolio risk) and better total returns over time. Today, Fairfax’s capability when it comes to capital allocation (structure, expertise, partnerships) is unique in the P/C insurance industry. It has become an important sustainable competitive advantage for the company. Back to our story. Strengthen Easton - 2020 In October of 2020, the Easton unit of Peak was acquired by Rawlings Sporting Goods. Easton was the #3 player in baseball and Rawlings was the clear #1 player. In the deal, Peak received $65 million in cash and a 28% stake in Rawlings. Importantly, this deal was done when Covid was raging and demand for all sports equipment (baseball, hockey and lacrosse) had fallen dramatically. Peak got a timely cash infusion and ownership in a much larger, stronger baseball company. The turnaround at Peak The turnaround at Peak took a number of years. Covid likely stalled their transformation by a couple of years. But over time, Peak returned to profitability. This can be seen from the distributions that started to happen to the two partners, Fairfax and Sagard. Below are the numbers that Fairfax has reported over the years for its investment in Peak. The sale of Rawlings stake - 2024 In Q2-2024, Peak sold its minority position in Rawlings Sporting Goods. A sale price was not disclosed. However, in Q2-2024, Sagard reported receiving a dividend of $60 million from Peak. Fairfax reported YTD September 30, 2024, share of profit of associated of $52 million, and said the elevated amount was due to the sale of Rawlings. Fairfax takes out partner Sagard There were rumours that Peak was being shopped. It is interesting that Fairfax ended up being the buyer. From an article in the Globe and Mail on August 24, 2024: “Sagard and Fairfax acquired Bauer out of bankruptcy in 2017 for US$575-million and are targeting a US$800-million exit, according to one of the sources. Bauer’s EBITDA is just more than US$100-million annually, the source said.” https://www.theglobeandmail.com/business/article-ccm-bauer-true-hockey-sale/#:~:text=Sagard%20and%20Fairfax%20acquired%20Bauer,to%20one%20of%20the%20sources. On September 30, 2024, Peak announced that Fairfax had bought out partner Sagard. The purchase will see Fairfax will double their ownership stake in Peak from 42.6% to 85.2%. Fairfax paid $325 million for Sagard’s 42.6% stake. This values Peak at $763 million. Power Corp (owner of Sagard) provided the financial details of the transaction: “On September 30, 2024, Peak announced that Fairfax will acquire Sagard’s 42.6% interest in Peak. On close of the transaction, the Corporation expects proceeds of approximately US$325 million, and to recognize a gain in net earnings of approximately US$195 million. The transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions.” Why did Fairfax buy out Sagard? Here are some thoughts: Fairfax likes the management team. Fairfax likes the long term return potential of the business. Culture wise, Peak is a good fit for Fairfax. The takeout of Sagard is following a very familiar playbook for Fairfax. Over the past 4 years, the majority of their capital allocation decisions has involved them buying more of stuff they already own. This is a very effective strategy for the following three reasons: The investment they are making falls into their circle of competence. They are able to value the asset well, allowing them to buy with a margin of safety. Growing the size of current investments allows them to concentrate in their best ideas. This is capital allocation 101 - simple, smart and effective. The kind of capital allocation preached by Warren Buffett, Charlie Munger and Peter Lynch. Here is what Wade Burton (President, Chief Investment Officer, Hamblin Watsa) had to say on Fairfax’s Q3-2024 earnings conference call: “We did make one significant announcement in the quarter. We bought out our main partners in Peak Achievement, an athletic wear and equipment company focused on hockey and lacrosse. It is an outstanding business operating in a highly consolidated industry, well run by Ed Kinnaly and his team, incredible track record, and we paid a fair price. We think we will make a very good return over the long run for our shareholders, and importantly, Ed runs the company very much in tune with the Fairfax culture.” “Looking back over the last two years, we’ve made three significant long term equity investments, one in Meadow Dairy, a dominant milk ingredients company in the U.K. that is doing very well; another in Sleep Country, a dominant mattress distributor and retailer in Canada; and now a third, Peak, a dominant sporting goods company focused on hockey and lacrosse. All immediately are or will contribute to our earnings, and we believe all will continue to contribute more and more as their businesses progress.” The non-insurance consolidated companies income stream at Fairfax gets bigger Fairfax continues to make material additions to its collection of non-insurance consolidated company holdings. In 2022, it took Recipe private. In 2023, it purchased Meadow Foods. In 2024, it took Sleep Country private. Peak was an associate holding for Fairfax. On close, Peak will become a consolidated holding. These additions are materially growing the size of this income stream for Fairfax. Here is what Jennifer Allen (Vice President, Chief Financial Officer) had to say on Fairfax’s Q3-2024 earnings conference call: “As Wade noted, with our recently announced Sleep Country and Peak Achievement transactions, we expect the operating income from our non- insurance companies reporting segment will grow in the future periods, reflecting the operating income diversity these investments will add to the segment.” Is a sizeable investment gain coming for Fairfax at close? Sagard is reporting that they expect to book an investment gain of $195 million when the deal closes. Perhaps this is what we also see from Fairfax. At December 30, 2023, Fairfax had a carrying value of $119 million for its 42.6% stake in Peak. Revaluing this to $325 million would result in a significant investment gain. How has Fairfax done with their investment in Peak? My math says Fairfax has generated a total return of about $243 million on its $154 million initial investment in Peak over the past 8 years. This is a CAGR of 12.6%. The dividends received of $72 million is to December 30, 2023. It is likely that Fairfax has received another dividend payment from Peak in 2024 (especially given the sale of their stake in Rawlings). We will likely get an update from Fairfax when they release their 2024 annual report. ————— Notes from Fairfax annual and quarterly reports: 2024 Q3 Report Consolidated share of profit of associates of $609.3 in the first nine months of 2024 principally reflected share of profit of $343.7 from Eurobank, $163.0 from Poseidon and $52.3 from Peak Achievement (principally reflecting its sale of Rawlings Sporting Goods), partially offset by share of loss of $60.1 from Sanmar Chemicals Group. 2023AR Fairfax continues to jointly own Peak Achievement with our partner, Sagard Holdings. Peak’s core brands are Bauer, the leading hockey brand, and Maverik, a leading lacrosse brand. Peak also owns a minority investment in Rawlings, which is the number one brand in baseball. Fairfax paid $154 million for its stake in Peak in 2017. Since that time, EBITDA has increased steadily in the hockey and lacrosse businesses, and Fairfax has received $72 million in dividends. Hockey participation growth continues post-pandemic and exciting developments such as Bauer’s partnership with the new Professional Women’s Hockey League are expected to drive incremental girls’ participation. More to come under CEO Ed Kinnaly’s leadership, with opportunities in direct-to-consumer, apparel and training. We carry Peak on our balance sheet at less than 5x free cash flow. 2020AR Fairfax continues to jointly own Peak Achievement with our partner, Sagard Holdings led by Paul Desmarais III. Peak’s core assets are Bauer, the leading hockey brand, and Easton, the number three manufacturing player in baseball. During 2020 Peak merged Easton with Rawlings, the clear number one manufacturer in baseball. The transaction resulted in $65 million cash paid to Peak, while retaining a 28% stake in Rawlings. Peak is now partnered with Rawlings’ controlling shareholder, Seidler Equity Partners. Fairfax recognized a $15 million gain on the sale of Easton which closed just before year end. 2017AR On March 1, 2017 the restructuring of Performance Sports Group Ltd. (‘‘PSG’’) was substantially completed after all of the assets and certain related operating liabilities of PSG were sold to an intermediate holding company (‘‘Performance Sports’’) co-owned by Fairfax and Sagard Holdings Inc. The company’s $153.5 equity investment in Performance Sports represents a voting interest of 50.0% and an equity interest of 42.6%. On April 3, 2017 Performance Sports was renamed Peak Achievement Athletics Inc. (‘‘Peak Achievement’’). 2016AR Also, early in 2017 we partnered with Paul Desmarais III and his excellent team at Sagard Capital to purchase Performance Sports. Performance Sports is the owner of the leading names in hockey, baseball and lacrosse equipment: Bauer, Easton and Cascade. ————— Notes from Power Corp’s annual and quarterly reports: Power Corp Q3, 2024 Interim Report Peak: Sagard held a 42.6% equity interest and a 50% voting interest in Peak at September 30, 2024 (same as at December 31, 2023). Peak designs, develops and commercializes sports equipment and apparel for ice hockey and lacrosse under iconic brands including Bauer. The Corporation’s investment is accounted for using the equity method. During the second quarter of 2024, Peak disposed of its minority interest in Rawlings Sporting Goods Company Inc. (Rawlings), a leading brand in baseball. In July 2024, Sagard received a distribution of US$60 million from Peak. On September 30, 2024, Peak announced that Fairfax will acquire Sagard’s 42.6% interest in Peak. On close of the transaction, the Corporation expects proceeds of approximately US$325 million, and to recognize a gain in net earnings of approximately US$195 million. The transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions. Power Corp 2017AR On February 27, 2017, Peak Achievement Athletics Inc. (Peak), an acquisition vehicle jointly controlled by Sagard Holdings and Fairfax Financial Holdings Limited, completed the acquisition of the assets of Performance Sports Group, Ltd. for total consideration of US$575 million. Peak designs and markets sports equipment and apparel for ice hockey, baseball, softball and lacrosse under iconic brands including Bauer and Easton. At December 31, 2017, the Corporation had invested $204 million (US$154 million) in Peak. Sagard Holdings holds a 42.6% equity interest and 50% of the voting rights in Peak. The Corporation’s investment is accounted for using the equity method. —————— Edited November 26, 2024 by Viking
Hoodlum Posted November 25, 2024 Posted November 25, 2024 25 minutes ago, Viking said: Peak Achievement Athletics - The rebuild has been completed On February 28, 2017, Fairfax partnered with Paul Desmarais III and his team at Sagard Holdings to purchase Performance Sports Group out of bankruptcy for total proceeds of US$575 million. The company was subsequently renames Peak Achievement Athletics. Performance Sports Group was a leading developer and manufacturer of sports equipment: Hockey - Bauer (#1 player) https://ca.bauer.com Baseball - Easton (#3 player) Lacrosse - Cascade and Maverik (combined, #1 player?) https://cascademaverik.com Performance Sports Group completes sale of substantially all of its assets to investor group led by Sagard and Fairfax Financial - Article from Feb 27, 2017 https://www.torys.com/en/work/2016/10/52382aeb-7e85-42dd-903c-309be9bb261a Why did Performance Sports Group go into bankruptcy? The primary problem wasn’t the business. It was the management team in place at the time - their decisions were terrible (changing their distribution strategy in Canada for Bauer and grossly overpaying for Easton are just two examples). Click the link below for details. Behind the bankruptcy of Performance Sports Group - Article from November 10, 2016 https://www.nhbr.com/behind-the-bankruptcy-of-performance-sports-group/#:~:text=Graeme%20Roustan%2C%20who%20blames%20the,time%20to%20arrange%20a%20sale. Details of the partnership In 2017, Fairfax and Sagard each invested $154 million (C$204 million). Each company held a 42.6% equity interest and 50% of the voting rights in Peak. The investment was accounted for using the equity method. It was not disclosed who owned the remaining 14.8% equity position in Peak. It is interesting that Performance Sports was purchased for total consideration of $575 million and Fairfax and Sagard only invested a total of $308 million (for their 85.2% interest). Who is Sagard Holdings? Sagard is a global multi-strategy alternative asset management firm active in venture capital, private equity, private credit, and real estate. https://www.sagard.com Sagard was launched in 2002 by the Desmarais family, which controls Montreal-based financial services giant Power Corp. of Canada. The aim was to invest in entrepreneurs and support the growth of middle-market businesses there. Fairfax has built out a wonderful capital allocation platform When deciding what to do with its $69 billion investment portfolio, Fairfax has build out an exceptionally diverse platform within the company that allows it to go to where the opportunity is at any given point in time - in public or private markets. In the case of Peak, Fairfax invested in the private market and like an alternative asset management firm. Fairfax’s partnership with Sagard is another good example of the many partnerships/relationships that Fairfax has been patiently building out over their 38 years of existence as a company. The benefits of what Fairfax has created are far reaching (future deal flow being just one example). The key take-away is Fairfax is extremely flexible with its capital allocation framework. This should lead to better diversification (lower portfolio risk) and better total returns over time. Today, Fairfax’s capability when it comes to capital allocation (structure, expertise, partnerships) is unique in the P/C insurance industry. It has become an important sustainable competitive advantage for the company. Back to our story. Strengthen Easton - 2020 In October of 2020, the Easton unit of Peak was acquired by Rawlings Sporting Goods. Easton was the #3 player in baseball and Rawlings was the clear #1 player. In the deal, Peak received $65 million in cash and a 28% stake in Rawlings. Importantly, this deal was done when Covid was raging and demand for all sports equipment (baseball, hockey and lacrosse) had fallen dramatically. Peak got a timely cash infusion and ownership in a much larger, stronger baseball company. The turnaround at Peak The turnaround at Peak took a number of years. Covid likely stalled their transformation by a couple of years. But over time, Peak returned to profitability. This can be seen from the distributions that started to happen to the two partners, Fairfax and Sagard. Below are the numbers that Fairfax has reported over the years for its investment in Peak. The sale of Rawlings stake - 2024 In Q2-2024, Peak sold its minority position in Rawlings Sporting Goods. A sale price was not disclosed. However, in Q2-2024, Sagard reported receiving a dividend of $60 million from Peak. Fairfax reported YTD September 30, 2024, share of profit of associated of $52 million, and said the elevated amount was due to the sale of Rawlings. Fairfax takes out partner Sagard There were rumours that Peak was being shopped. It is interesting that Fairfax ended up being the buyer. From an article in the Globe and Mail on August 24, 2024: “Sagard and Fairfax acquired Bauer out of bankruptcy in 2017 for US$575-million and are targeting a US$800-million exit, according to one of the sources. Bauer’s EBITDA is just more than US$100-million annually, the source said.” https://www.theglobeandmail.com/business/article-ccm-bauer-true-hockey-sale/#:~:text=Sagard%20and%20Fairfax%20acquired%20Bauer,to%20one%20of%20the%20sources. On September 30, 2024, Peak announced that Fairfax had bought out partner Sagard. The purchase will see Fairfax will double their ownership stake in Peak from 42.6% to 85.2%. Fairfax paid $325 million for Sagard’s 42.6% stake. This values Peak at $763 million. Power Corp (owner of Sagard) provided the financial details of the transaction: “On September 30, 2024, Peak announced that Fairfax will acquire Sagard’s 42.6% interest in Peak. On close of the transaction, the Corporation expects proceeds of approximately US$325 million, and to recognize a gain in net earnings of approximately US$195 million. The transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions.” Why did Fairfax buy out Sagard? Here are some thoughts: Fairfax likes the management team. Fairfax likes the long term return potential of the business. Culture wise, Peak is a good fit for Fairfax. The takeout of Sagard is following a very familiar playbook for Fairfax. Over the past 4 years, the majority of their capital allocation decisions has involved them buying more of stuff they already own (and understand exceptionally well). This is capital allocation 101 - simple, smart and effective. Here is what Wade Burton (President, Chief Investment Officer, Hamblin Watsa) had to say on Fairfax’s Q3-2024 earnings conference call: “We did make one significant announcement in the quarter. We bought out our main partners in Peak Achievement, an athletic wear and equipment company focused on hockey and lacrosse. It is an outstanding business operating in a highly consolidated industry, well run by Ed Kinnaly and his team, incredible track record, and we paid a fair price. We think we will make a very good return over the long run for our shareholders, and importantly, Ed runs the company very much in tune with the Fairfax culture.” “Looking back over the last two years, we’ve made three significant long term equity investments, one in Meadow Dairy, a dominant milk ingredients company in the U.K. that is doing very well; another in Sleep Country, a dominant mattress distributor and retailer in Canada; and now a third, Peak, a dominant sporting goods company focused on hockey and lacrosse. All immediately are or will contribute to our earnings, and we believe all will continue to contribute more and more as their businesses progress.” The non-insurance consolidated companies income stream at Fairfax gets bigger Fairfax continues to make material additions to its collection of non-insurance consolidated company holdings. In 2022, it took Recipe private. In 2023, it purchased Meadow Foods. In 2024, it took Sleep Country private. Peak was an associate holding for Fairfax. On close, Peak will become a consolidated holding. These additions are materially growing the size of this income stream for Fairfax. Here is what Jennifer Allen (Vice President, Chief Financial Officer) had to say on Fairfax’s Q3-2024 earnings conference call: “As Wade noted, with our recently announced Sleep Country and Peak Achievement transactions, we expect the operating income from our non- insurance companies reporting segment will grow in the future periods, reflecting the operating income diversity these investments will add to the segment.” Is a sizeable investment gain coming for Fairfax at close? Sagard is reporting that they expect to book an investment gain of $195 million when the deal closes. Perhaps this is what we also see from Fairfax. At December 30, 2023, Fairfax had a carrying value of $119 million for its 42.6% stake in Peak. Revaluing this to $325 million would result in a significant investment gain. How has Fairfax done with their investment in Peak? My math says Fairfax has generated a total return of about $243 million on its $154 million initial investment in Peak over the past 8 years. This is a CAGR of 12.6%. The dividends received of $72 million is to December 30, 2023. It is likely that Fairfax has received another dividend payment from Peak in 2024 (especially given the sale of their stake in Rawlings). We will likely get an update from Fairfax when they release their 2024 annual report. ————— Notes from Fairfax annual and quarterly reports: 2024 Q2 Report Consolidated share of profit of associates of $221.4 in the second quarter of 2024 principally reflected share of profit of $126.1 from Eurobank, $66.5 from Poseidon and $31.5 from Peak Achievement (principally reflecting its sale of Rawlings Sporting Goods), partially offset by share of loss of $39.0 from Sanmar Chemicals Group. 2023AR Fairfax continues to jointly own Peak Achievement with our partner, Sagard Holdings. Peak’s core brands are Bauer, the leading hockey brand, and Maverik, a leading lacrosse brand. Peak also owns a minority investment in Rawlings, which is the number one brand in baseball. Fairfax paid $154 million for its stake in Peak in 2017. Since that time, EBITDA has increased steadily in the hockey and lacrosse businesses, and Fairfax has received $72 million in dividends. Hockey participation growth continues post-pandemic and exciting developments such as Bauer’s partnership with the new Professional Women’s Hockey League are expected to drive incremental girls’ participation. More to come under CEO Ed Kinnaly’s leadership, with opportunities in direct-to-consumer, apparel and training. We carry Peak on our balance sheet at less than 5x free cash flow. 2020AR Fairfax continues to jointly own Peak Achievement with our partner, Sagard Holdings led by Paul Desmarais III. Peak’s core assets are Bauer, the leading hockey brand, and Easton, the number three manufacturing player in baseball. During 2020 Peak merged Easton with Rawlings, the clear number one manufacturer in baseball. The transaction resulted in $65 million cash paid to Peak, while retaining a 28% stake in Rawlings. Peak is now partnered with Rawlings’ controlling shareholder, Seidler Equity Partners. Fairfax recognized a $15 million gain on the sale of Easton which closed just before year end. 2017AR On March 1, 2017 the restructuring of Performance Sports Group Ltd. (‘‘PSG’’) was substantially completed after all of the assets and certain related operating liabilities of PSG were sold to an intermediate holding company (‘‘Performance Sports’’) co-owned by Fairfax and Sagard Holdings Inc. The company’s $153.5 equity investment in Performance Sports represents a voting interest of 50.0% and an equity interest of 42.6%. On April 3, 2017 Performance Sports was renamed Peak Achievement Athletics Inc. (‘‘Peak Achievement’’). 2016AR Also, early in 2017 we partnered with Paul Desmarais III and his excellent team at Sagard Capital to purchase Performance Sports. Performance Sports is the owner of the leading names in hockey, baseball and lacrosse equipment: Bauer, Easton and Cascade. ————— Notes from Power Corp’s annual and quarterly reports: Power Corp Q3, 2024 Interim Report Peak: Sagard held a 42.6% equity interest and a 50% voting interest in Peak at September 30, 2024 (same as at December 31, 2023). Peak designs, develops and commercializes sports equipment and apparel for ice hockey and lacrosse under iconic brands including Bauer. The Corporation’s investment is accounted for using the equity method. During the second quarter of 2024, Peak disposed of its minority interest in Rawlings Sporting Goods Company Inc. (Rawlings), a leading brand in baseball. In July 2024, Sagard received a distribution of US$60 million from Peak. On September 30, 2024, Peak announced that Fairfax will acquire Sagard’s 42.6% interest in Peak. On close of the transaction, the Corporation expects proceeds of approximately US$325 million, and to recognize a gain in net earnings of approximately US$195 million. The transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions. Power Corp 2017AR On February 27, 2017, Peak Achievement Athletics Inc. (Peak), an acquisition vehicle jointly controlled by Sagard Holdings and Fairfax Financial Holdings Limited, completed the acquisition of the assets of Performance Sports Group, Ltd. for total consideration of US$575 million. Peak designs and markets sports equipment and apparel for ice hockey, baseball, softball and lacrosse under iconic brands including Bauer and Easton. At December 31, 2017, the Corporation had invested $204 million (US$154 million) in Peak. Sagard Holdings holds a 42.6% equity interest and 50% of the voting rights in Peak. The Corporation’s investment is accounted for using the equity method. —————— Thanks @Viking for the detailed outline of the Peak transaction history and summary. It is a little easier now to understand the Peak investment with Bauer becoming the main business. It will be interesting to see the dividend capacity in 2025 for Peak, as this should give us an idea of what to expect going forward.
Hoodlum Posted November 26, 2024 Posted November 26, 2024 (edited) On 11/25/2024 at 7:55 AM, nwoodman said: Superb! So played out something like this: This was not mentioned in the previous link I provided on Eurobank, but not surprising. https://cyprus-mail.com/2024/11/26/hellenic-bank-to-merge-with-eurobank-following-e1-2-billion-deal/ According to analysts familiar with the process involved, if the February public offer does not result in full acquisition, a so-called squeeze-out mechanism will be employed, allowing Eurobank to acquire the remaining shares by legal mandate. Edited November 26, 2024 by Hoodlum
nwoodman Posted November 26, 2024 Posted November 26, 2024 Eurobank – Plum | Expanding Strategic Partnership “Eurobank expanded its strategic partnership with UK-based Plum Fintech Limited ("Plum") by advancing a second €5 million minority capital investment to Plum, one of Europe's fastest-growing fintechs that has built a "smart money management" app. With its new investment in the company, Eurobank has invested a total of €10 million in Plum and is becoming one of its main financiers. At the same time, Plum has successfully completed its second fundraising round, raising a total of ~€18.4 millionfrom Eurobank and third-party investors.” Some notes attached on Plum Fintech Ltd. Interesting that Plum’s CEO, Victor Trokoudes, is ex Transfer Wise (WISE.L). I hadn’t made the link previously. A recent interview: Plum Fintech.pdf
Viking Posted November 27, 2024 Posted November 27, 2024 (edited) Eurobank Update - The Hellenic Bank acquisition is a game changer Introduction Over the past 3.9 years, the market value of Fairfax’s position in Eurobank has grown from $900 million to $2.7 billion, an increase of $1.8 billion or 204%, which is a CAGR = 33%. Yes, that has been exceptional performance. As a result, Eurobank has been a home run investment for Fairfax and its investors over the past 4 years. Fairfax’s total equity portfolio has a market value of about $20 billion. With a market value of $2.7 billion, Eurobank is a 14% position for Fairfax. This makes Eurobank Fairfax’s largest equity holding - by far. If your largest positions perform well then your total portfolio return will probably also do well. Despite its stellar performance the past 4 years, Eurobank looks like it is very well positioned to continue to perform well in the coming years. In the rest of this post we will look into the past (what happened at Eurobank?) and then we will pivot and look into the future (what does the future of Eurobank look like?). What happened at Eurobank? Two things happened at Eurobank to spike its earnings and stock price: The management team at Eurobank continued to execute exceptionally well. Their strategic decisions over the past 6 years have been especially good. External forces in Greece shifted from major headwinds to major tailwinds: The EU abandoned its zero interest rate regime. Higher interest rates spiked interest income for banks. Politically, Greece pivoted hard to more of a capitalist/free market economy. Pro-business reforms have resulted in Greece having one of the top performing economies in Europe in recent years and this is expected to continue in the coming years. Greece’s economy has gone from depression to rapid growth. The result of these two developments saw Eurobank deliver a 378% return to investors over the past 3.9 years. What does the future of Eurobank look like? After such a stellar run, is Eurobank’s stock now priced for perfection? My guess is no. For a couple of important reasons: Greece’s economy is poised to do well in the coming years. Eurobank’s management team is excellent. That is a great combination. Importantly, the management team at Eurobank has already set the table for Eurobank to continue to deliver strong results in the coming years. What did they do? A bunch of things. In the rest of this post we are going to focus on one of their strategic decisions - the purchase of Hellenic Bank in Cyprus. Cypress Scale matters in banking. A lot. Eurobank is very well positioned in Greece and Bulgaria. In 2023, Eurobank made the decision to exit Serbia, and sell its bank (that had #8 market share). Smart. Eurobank also had a presence in Cyprus (the # 3 bank). Eurobank decided Cyprus was a country it wanted to grow in. So in 2021 it acquired a small stake in Hellenic Bank, the #2 bank in Cyprus. Over 2022 and 2023, Eurobank increased its ownership in Hellenic Bank to 55%. And in the last two weeks, to 94%. The takeover of Hellenic Bank will be completed in Q1 2025. This is a game changer for Eurobank. Eurobank Cyprus and Hellenic Bank make Eurobank a powerhouse in banking in Cyprus. In 2024, Hellenic Bank also expanded into insurance with the acquisition of CNP Cyprus. But we are getting ahead of ourselves. Let’s review the Hellenic Bank acquisition. Hellenic Bank Eurobank obtained full control of Eurobank on November 25, 2024 with the takeout of the 2 remaining large shareholders. Eurobank acquires full control of Hellenic Bank https://knews.kathimerini.com.cy/en/business/eurobank-acquires-full-control-of-hellenic-bank Price paid matters. Eurobank will pay a total of about $1.36 billion to acquire 100% of Hellenic Bank. It has been a 4-year journey. The table below shows each of the moves made by the management team at Eurobank. Slow. Steady. Methodical. How much is Hellenic Bank earning? Hellenic Bank is poised to earn about $772 million total in 2023 and 2024 = $386 million on average. Eurobank is paying about 3.36 x expected average 2023/2024 earnings. That is exceptional value. Is Hellenic Bank over earning? We will get our answer to this question in the coming years. Interest income is likely over earning (with the ECB cutting interest rates). But Eurobank has many levers to pull to significantly grow profits in other areas. What are some tailwinds to profitability of Hellenic Bank/Eurobank Cypress? 1.) Grow the top line - Hellenic bank has a number of things it can do to grow its top line. There is a significant opportunity to grow Hellenic Bank’s loan book. Expansion into insurance In April 2024, Hellenic Bank announced it was making a major expansion into insurance (life and P/C) in Cyprus with the purchase of CNP Cyprus for €182 million. This deal is expected to close in Q1 2025. Acquisition of CNP Cyprus solidifies Hellenic Bank's dominance in Cypriot insurance market https://knews.kathimerini.com.cy/en/business/€182m-deal-marks-hellenic-s-strategic-move-into-insurance-sector Hellenic Bank has lots of excess capital – this looks like a smart move. This move also fits very well with Eurobank/Fairfax (Fairfax owns Eurolife, one of the largest life insurance companies in Greece). Slide from Hellenic Bank’s Q3 2024 earnings presentation 2.) Reduce expenses - merge Eurobank Cyprus and Hellenic Bank On November 26, 2024 it was reported that Eurobank will be merging Hellenic Bank with Eurobank Cyprus. This will be a multi-year process and should lead to a stronger bank in Cyprus. Over time, it should also result in significant cost savings. Remember, there is also a third leg to this stool - and that is Hellenic Bank’s insurance acquisition. There are really three businesses to be integrated in Cyprus: Eurobank Cyprus, Hellenic Bank and CNP Cyprus. Hellenic Bank to merge with Eurobank following €1.2 billion deal https://cyprus-mail.com/2024/11/26/hellenic-bank-to-merge-with-eurobank-following-e1-2-billion-deal/ 3.) Synergies The synergies from combining the three businesses should be significant. We already mentioned cost savings. But importantly, there will also be cross-selling opportunities which should result in revenue growth. Summary Eurobank has made a number of significant strategic decisions in recent years. The biggest was the decision to aggressively expand in Cyprus with the purchase of Hellenic Bank. With the announcements the past couple of weeks, all of their hard work is quickly coming together. When Eurobank reports 2024 year-end results next year, we will also get their 2025 business plan. It will be very interesting to see the integration plans for their operations in Cyprus and what the new business/profit outlook is. Cyprus will likely drive a big part of the growth (top and bottom line) for Eurobank in the coming years. But the real lesson of Hellenic Bank is the impact that an exceptional management team can have on business results. Especially over a couple of years. And in a region like Greece (coming out of a depression). The management team at Eurobank looks like they are the real deal. It will be interesting to see what they do in the coming years. ————— Hellenic Bank - Q3-2024 Earnings Presentation https://www.hellenicbank.com/-/media/hbc/announcements/2024/november/9m/9m24_fr-presentation_final.pdf ————— Slide from Eurobank’s Q3-2024 Earnings Presentation The slide below shows the balance sheet of Eurobank and the impact of adding Hellenic Bank. (Eurobank consolidated Hellenic Bank in Q3, 2024, with a control position of 55.5%. In Q1, 2025, its control position will increase to 93.5%.) ————— Presentation on Eurobank by CEO Fokion Karavias in April 2024 Eurobank: A turnaround story https://www.ivey.uwo.ca/media/hznli5um/keynote-fokion-karavias.pdf Edited December 4, 2024 by Viking
intothebreach Posted November 27, 2024 Posted November 27, 2024 Viking, I just want to say thanks for your continued analysis and sharing to the board; I learn something new every time. Much, much appreciated!
Haryana Posted November 28, 2024 Posted November 28, 2024 https://thebanks.eu/countries/Cyprus/major_banks The combined Eurobank in Cyprus should become the largest bank in the country.
Redskin212 Posted November 28, 2024 Posted November 28, 2024 Viking loved the analysis on Eurobank. Reminiscent of the Bank of Ireland investment but bigger and bolder. What percentage of Eurobank does Fairfax own? I think I missed it.
Redskin212 Posted November 28, 2024 Posted November 28, 2024 I looked it up. fairfax owned 34.4% of Eurobank at September 30,2024
Viking Posted November 28, 2024 Posted November 28, 2024 2 hours ago, intothebreach said: Viking, I just want to say thanks for your continued analysis and sharing to the board; I learn something new every time. Much, much appreciated! @intothebreach , i appreciate the comment. You are welcome. At the end of the day, i post on topics that are of interest / timely / that i want to lean more about. Posting the articles to the board really helps me to focus (I want to get them close to being accurate). And the comments from other board members often provide some additional insights which improves our understanding even more. It really has been a virtuous circle over the past 4 years.
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