Potential liquidation of UMS United Medical Systems International AGOn August, 14th, the company announced the sale of all shares in United Medical Systems (DE), Inc., Massachusetts, USA for €56.4m. With 4.757.668 shares this equals €11.85 per share compared to the share price of €9.56. Although "customary transaction expenses will be deducted hereof."
For the sale to go through an approval at the extraordinary shareholders' meeting on September, 25th is required. The company has already secured about 38% of the total votes:
Major shareholders of the Company, namely (i) Thomas J.C. Matzen GmbH, Hamburg, (ii) Jorgen Madsen, Bolton (Massachusetts, USA), (iii) MaWoBi Beteiligungsgesellschaft mbH, Hamburg, (iv) Marina Bello-Biedermann, Hamburg and (v) Norbert and Bärbel Heske, Türkenfeld, who in all hold about 38 % of the shares of the Company, have on the initiative of and vis-à-vis the Company (in each case individually) expressed their intent to support this transaction and to vote in favor of the sale of UMS USA to the Purchaser on the upcoming EGM.If the sale goes through UMS AG will be left with no operation and just one employee (as of 12/31/2013).
|simplified structure [UMS AG]|
|Chart UMS AG [yahoo]|
write-up from 2012 (value uncovered) for general information on the business
documents regarding the proposed sale
Covidien: Merger-arbitrageI recommend reading the seeking alpha article of Mr Teicher
Google spreadsheet with implied discount: Link
For the portfolio a position in COV was established at a discount larger than 10%.
The COV position was sold today at prices above $91, because the discount has fallen below 7%. If the deal fails, which I view as low probability, there would be some downside for COV. All in all the risk-reward was not as attractive as before. If the spread to the implied value of COV widens again, the position will be rebought.
The IMW Immobilien position has been trimmed in the last weeks at prices above €7. A updated post may follow.