"Now we need to do a great job in the company and what I want to do is have all the powers and understand when a euro comes out, why it comes out and how it comes out". This is how Urbano Cairo presented himself, confirming his reputation for cutting costs, at the Cairo Communications shareholders' meeting, called to approve the 70 million capital increase functional to the acquisition. The plan of the publisher of La7 provides the merger between RCS and Cairo within 12-24 months, with the purpose of achieve a gross operating margin (Ebitda) of 2018 million in 215, on revenues of 1.340 million. Meanwhile, as expected, after the battle the stocks involved in the duel are deflated: Cairo Communications drops 6,7% while RCS Mediagroup drops 4,9%.
As for yesterday's adversaries, they have become "good traveling companions" with whom, starting with Diego Della Valle (who probably regrets having declined Cairo's invitation to participate in the operation), he intends to maintain good relations. Especially after the consortium Imh (International Media Holding) led by Andrea Bonomi today decided to withdraw from the battle by returning the shares already withdrawn to the holders and thus making Consob's intervention unnecessary.
The publisher guaranteed at the meeting of have no intention of distorting the Corriere della Sera, with the risk of losing its target audience. “Let alone transforming a newspaper like Corriere into a tabloid – he replied to a shareholder -. it would be crazy, as well as intervene on its editorial line. I don't know exactly when I will join the RCS board. On August 4 there will be the settlement for the shares that will be delivered to us after being migrated from the Bonomi offer. Only then will we have the overall picture. Then we will see the behavior of this council, we will see what will be necessary to do so that I enter with all the proxies. There could be an assembly to convene to make a new board or maybe even sooner, we'll talk to the president to see what they want to do.
With regard to the direction of the Corriere, whose leadership Luciano Fontana intends to confirm, Cairo expressed himself as follows: “You tell me I want to do The Sun, while Bonomi and his associates wanted to do the Washington Post or the NY Times. Nothing further from reality. In 2003, I thought about the idea of launching a newspaper inspired by English newspapers that have a large circulation, then, not having found the right editor, I avoided doing it. Newspapers, like TV, have a mainstream audience that you mustn't disappoint. There is nothing more habitual than reading a newspaper, which must be handled with great caution: even a graphic review creates disturbance. What I think is that the fewer people who notice I've arrived the better. Or rather: they must realize it because the newspaper is richer and gives more answers to the need for information”.
It is with these premises that the adventure takes off. The shareholders who adhered to Bonomi's takeover bid now have five days to deliver the bonds in Cairo (starting from the definitive communication of acceptances of the Public Offer expected by 7.59 on Thursday 21 July). It is probable that a large part of the shares could now be turned over in Cairo, which could rise up to 61,8% of the capital. According to Equita Sim, "if all the shareholders who delivered the shares to Imh now give them to Cairo, excluding those of the main partners, the total cost of the offer would increase to 81 million and Cairo's stake in its group would drop to 47,8 .51%”. In this case, the publisher has already anticipated that it will recover over XNUMX% with stock market purchases.
The new Cairo looks like this: for Equita Sim (advisor of the takeover bid, rating buy and the target price at 5,5 euros) "the market capitalization, in the event of an increase in the RCS share to 60%, it will rise to around 590 million from the current 344". Urbano Cairo's company could pay the component in cash by drawing on cash (108 million as at 31 March before the distribution of the dividend) without using it completely and without using the credit line granted by Intesa Sanpaolo.
“To date, based on the shares contributed, the cash part of the offer (0,25 euro per share) costs us just under 65 million – said the publisher during the meeting -. Approximately 13% of the capital subscribed to the other offer. If all the shares migrated, it would be another 17 million, for a total of 80,6 million euros. Cairo would still have some liquidity and we shouldn't even touch Intesa's 140 million credit line".
Finally, it should be noted that the extraordinary shareholders' meeting of Cairo Communication held this morning approved the capital increase of 70 million euros to strengthen the company's assets and meet the needs associated with the takeover bid launched on RCS.
