CLOSING SHORT MEDIASET

MUSCLE SHOW IS OVER. +31.40% abs +24.41% rel

The bid hasn’t come to fruition and the announcement that the shares will be placed into a trust denote that VIV wants TI more than MS. In the meantime the market has been left to deal with the decline in OTT TV and numerous warnings elsewhere in the space, allowing MS to reconnect with fundamentals.

 

SHORT MS IM
SHORT MEDIASET

Wednesday• 5th April 2017 • 15:04

We continue to run the short post the ruling that an anti-hostile takeover measure will be presented as a government amendments to the competition bill as an incremental bear point for the stock.

We should hear any day now re the outcome of the regulator’s review where there is a non-zero chance VIV are forced to sell some of their position down. Even if they are not, we struggle to see an outcome that enhances value for MS beyond the 50% rally it has already had.

To add to the bear tack, results look as though they are likely to continue to be poor this quarter and there is a material chance that we one of hit to results due to write downs on TV rights and lay off costs, stretching the belief that ad growth is likely to return anytime soon. SELL . REITERATE SHORT Currently +5.01%

 

REITERATE SHORT Currently +5.01%

Tuesday • 31 January 2017 • 11:03

Nothing stopping it back to EUR3.50 and I can see back to the break level of at EUR 2.7

The trading short was based on the fact that a take over was not on the cards. Due to Bollore’s previous stake building strategy and admission that he intended to build his stake to 20%. Added to this was Berlusconi’s blocking stake.

We stick with our short and would be happy to sell more here/initiate a position.

We are now finally in the money. +3.5%.

 

MEDIASET (TRADING SHORT)
CLOSING HALF FOR +10.05%

Thursday • 15 December 2016 • 11:03

The trading short was based on the fact that a take over was not on the cards. Due to Bollore’s previous stake building strategy and admission that he intended to build his stake to 20%. Added to this was Berlusconi’s blocking stake. So when the muscle flexing/additional buying abated a sell off would ensue.

Vivendi announced that it has reached its 20% stake in Mediaset this morning. Talk of a Mediaset rights issue to fend off Vivendi as Berlusconi gets his gloves on has also helped us this morning.

We use this morning weakness to close half of our position for a 10.05% return in 24hrs.

 

MEDIASET TRADING SELL
WHERE’S THE BEACH?

Wednesday • 14 December 2016 • 11:47

Got to love this muscle flexing between two European titans. But it is important to remember the objectives here. Bollore wants a piece of MS premium for distribution. He has previous with forcing through change by acquiring board seats (see TI), so we might expect him to get to 20% over time, get 2 board seats and put Berlusconi under pressure. However we have to believe he has learnt from his TI mistakes, where he is now heavily under water, and assume he will be more discerning over price for the next 7%.

The fact Berlusconi has 40% now means there is no chance of a takeover, and he already has a blocking stake.

So this additional buying from both is just muscle flexing. MS has added 1.3bn EUR to its market cap in the last 2 days. Most have MS premium (loss making) in their SOTP at less than 500m EUR.

The sticking point over the summer was price amid unrealistic targets. Assuming there is no takeout, it is hard to see what the upside is from here once the dust settles.

TRADING SELL.