Knowit acquires the MC business
Transaction is evidence of value creation
Estimate revisions to reflect continuing operations
Capacent announced on 1 September that it had entered an agreement to divest the Management Consulting business to Knowit. The purchase price is an EV of SEK 155m with a possible earnout of up to SEK 30m that is based on the EBIT generated during 2021 for the divested companies. The initial amount will be paid in cash on the day of access, which is expected to be 1 October 2021. The current CEO, Edvard Björkenheim, is part of the deal as well as the Capacent brand. Therefore, Edvard will step down as CEO and be replaced by the current chairman of the board Joakim Hörwing, who will in turn be replaced as chairman by Per Olof Lindholm. Capacent Holding will also change name as part of the process. In addition, the company has called for an extraordinary general meeting, which will occur on 12 October, to decide on an extra dividend of SEK 30 per share, equivalent to SEK 81.5m.
We raise our fair value range after the transaction to SEK 73-89 per share. It is based on a P/E range of 10-15x for ‘22e net profit, an earnout range of SEK 0-30m, distributable cash of SEK 157m and a valuation of Capacent’s share in Commended.ai of SEK 9m.