Berenberg cuts Assa Abloy on growth slowdown, takeover troubles

Spectrum Brands Holdings

08/11/2022 08:07

** Berenberg cuts Assa Abloy  ASSAb.ST  to "hold" from
"buy", citing likely growth slowdown and hurdles to a takeover
deal in the United States
    ** "Assa Abloy finds itself in a difficult position," the
broker says even though it notes the company's stronger than
expected Q3 results
    ** Berenberg expects the company's organic growth to decline
to 3% in 2023 from the record 13.5% in 2022
    ** Berenberg also points to objections from a watchdog to
the acquisition of the Hardware and Home Improvement division
from Spectrum Brands Holdings in the U.S.
        ** "No good options with HHI," it says, adding that as
most likely Assa Abloy will fight in court it means uncertainty
over whether the deal will complete for at least another 6-9
months
  
        ** On the other hand, if it wins, it will take on a
business that now looks expensive given the weakening in the
operational performance as U.S. residential demand slows,
Berenberg says
  
    ** In August, Jefferies also cut Assa to "hold", citing a
weakening sentiment within the home improvement industry
 (Reporting by Boleslaw Lasocki)
 ((boleslaw.lasocki@tr.com))