SEB cuts Aker Horizons to 'hold' amid growing uncertainty surrounding JV valuation

Aker Horizons ASA

28/06/2023 15:20

** SEB downgrades Aker Horizons  AKH.OL  to "hold" from
"buy", halves target price to NOK 7, as it sees valuation of
Mainstream Reneweable Power (MRP)- the company's joint venture
with Japanese Mitsui  8031.T  - looking "increasingly
unteanable"
    ** "We appreciate that development efforts involve long
timelines but agree with the market that the reported NAV of NOK
23/share is unrealistic"
    ** The brokerage also echoes the market's view that the
prices Aker Horizons paid for MRP in late 2021 and Mitsui paid
for its 27.5% stake in spring 2022 are above today's values
    ** "Considering recent operational issues in Chile, where
much of the development portfolio is located, we now apply the
low end of our bottom-up valuation of NOK 8bln to MRP", it adds
    ** SEB's previous valuation was NOK 21 billion corresponding
with the booked value on Aker Horizons' balance sheet
    ** Further, it cuts Aker Horizons' sum-of-the-parts analysis
(SOTP) to NOK 12 per share from previous NOK 21
    ** Shares of Aker Horizons are down 4.8%, underperforming
the Oslo Stock Exchange equity index  .OBX , which rises 1.2%   
           
    

 (Reporting By Jesus Calero)
 ((Jesus.calero@thomsonreuters.com))