Kinnevik KINVILB SS
May 19, 2021 - 8:44am EST by
Stelio
2021 2022
Price: 154.00 EPS 0 0
Shares Out. (in M): 242 P/E 0 0
Market Cap (in $M): 4,500 P/FCF 0 0
Net Debt (in $M): 0 EBIT 0 0
TEV (in $M): 4,500 TEV/EBIT 0 0

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Description

 

 

~7% 'free' return in three weeks. Long Kinnevik redemption shares / short Zalando.

I hope you won't consider this as unnecessarily taking up vic space, but I thought I would share this trade.

Trade

  •          Kinnevik (KINVB SS) recently distributed its ~21% stake in Zalando (ZAL GY) to Kinnevik shareholders.
  •          Each Kinnevik shareholder received 1 redemption share Kinnevik (KINVILB SS / SE0015797600) (1 redemption share per Kinnevik share).
  •          The redemption shares are tradable as of today until June 9, 2021 (3 weeks) and will ultimately be redeemed for 0.195 shares Zalando.
  •          The redemption shares have been sold off today perhaps due to market circumstances or funds not allowed to own 'transition' shares. Whatever the reaons, at current prices the redemption shares provide ~7% gross upside over the next three weeks.
  •          Trade involves going long the redemption shares and short Zalando (at the appropriate ratio).
  •          The shares are very liquid (at least today wrt the redemption shares) so the trade can be done in size.

Risks

FX, but can be hedged
Spread still widening at the time of this post
Costs / taxes

 

I do not hold a position with the issuer such as employment, directorship, or consultancy.
I and/or others I advise do not hold a material investment in the issuer's securities.

Catalyst

Conversion of redemption shares.

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