ZEAL Network SE Receives a "Buy" Recommendation from NuWays AG

NuWays AG has updated its recommendation for ZEAL Network SE to "Buy" as of July 25, 2024. The target price is set at EUR 54.00. Analyst Henry Wendisch highlights a recent squeeze-out request for Lotto24, deemed highly value-accretive.

The squeeze-out involves a payment of €36.3m for the remaining 4.55% of shares, based on a valuation by KPMG AG and ADKL AG. Financing this via debt is seen as feasible, given ZEAL's net cash position of €25m at the end of Q1 2024 and an expected free cash flow of €30m for 2024.

Cost savings are projected to outweigh the incurred costs, with a net present value (NPV) calculation of €143m. These savings include a lower effective tax rate, elimination of minority interest, and reduced overhead costs.

The squeeze-out resolution is expected to pass during Lotto24's AGM on August 27, 2024. The process should be executed once the appeals period concludes.