| CATEGORY: BROKER RECOMMENDATIONS SECTOR: BEVERAGES |
Broker snap: Citi applauds Gaymers deal |
|
Tue 01 Dec 2009
|
LONDON (SHARECAST) - Magners cider maker C&C has had a tough time of it since rivals muscled in on its ‘cider over ice’ market, but Citigroup thinks the acquisition of The Gaymer Cider Company for £45m could prove a winner.
Citi has crunched some numbers and reckons the deal could be earnings enhancing to the tune of 3-5% by fiscal 2012/13.
‘This deal is strategically sound in our view. It gives C&C: (1) further scale in GB [Great Britain]; (2) a broader cider portfolio with which to complete with Heineken and (3) a sales force and presence in the off trade,’ Citi analyst Liz Hartley opines.
The broker has reiterated its ‘buy’ recommendation and €2.95 target price. ‘While the group's medium-term focus will now be on integration (ABI and Gaymer assets), we believe C&C is now a more tangible competitor to market leader Heineken,’ Hartley concluded.
|
|
| |
|
 |
Archived Stories |
 |
|
Front Page Stories |
|
|
