Classification of NuWays AG to LAIQON AG

Company Name:	LAIQON AG
ISIN:	DE000A12UP29
Reason for the research:	Update
Recommendation:	BUY
from:	06.08.2024
Target price:	EUR 9.10
Last rating change:
Analyst:	Henry Wendisch

LAIC token placed & mVBRB cooperation intensified; chg. PT

Last week, LAIQON successfully placed the LAIC-Token 24 as well as a capital increase subscribed by meine Volksbank Raiffeisenbank eG, Rosenheim (mVBRB) in its subsidiary LAIC Capital GmbH (LAIC), leading to total gross proceeds of € 7.2m. Furthermore, mVBRB and LAIQON signed an LOI to intensify their existing cooperation. In detail:

(A) LAIC Token 24 placed: following the successful placement of the Token 21 three years back, LAIQON sold another  5,250 GmbH shares of LAIC (tokenized) to the Token 24 investor group, which comprises institutional  investors, but also key employees of LAIQON (or LAIC). Additionally, 849 new GmbH shares have been created, serving as a capital increase of LAIC. On  the basis of a €  65m valuation for LAIC (based on a pwc assessment per 31st Dec. '23), this should have led to € 3.2m gross proceeds for LAIQON (eNuW; sale of existing 5,250 shares) as well as € 0.5m gross proceeds for LAIC (eNuW; sale of 849 new shares).  - see p. 2

(B) Capital increase by mVBRB at LAIC: also based on the € 65m valuation of LAIC, mVBRB) solely subscriped a 5.04% cash capital increase in return for 5,353 new shares (or 5.04%), leading to gross proceeds of € 3.3m (eNuW) for LAIC. - see p. 2 for details

(C) Merger of LAC with BV: in order to decomplex the shareholder structure and remove dual costs for e.g. audit (eNuW: € 0.2m in savings), Lange Assets & Consulting GmbH (LAC; 90% subsidiary) should be merged into BV GmbH.

(D) Letter of Intent with mVBRB signed: outside of LAIC transactions described above, the mVBRB and LAIQON want to intensify their cooperation within their current JV 'meine BV GmbH' (mBV). Specifically, it  comprises the sale of 25% of BV Bayerische Vermögen GmbH (BV; a 100% LAIQON subsidiary which directly holds 25% of the joint venture mBV, see p. 2 for overview) to mVBRB. The transaction price is not disclosed. Nevertheless, we regard the sale as strategic for both sides: a) mVBRB increases its ties to LAIQON, which serves as the platform and white label solution provider for mVBRB's wealth management and b) LAIQON benefits from one of their largest customer and partner deepening its commitment to LAIQON's products and services.

Use of proceeds: in addition to the € 7.2m gross proceeds from (A) and (B), LAIQON should receive another undisclosed payment from (D). All of which  should be invested into 1) the enhancement of the DAP 4.0 in order to set the basis for further cooperations as well as 2) personnel and project expenses for the development of the LAIC:GPT solution but also into new and existing cooperations. As of H1'24, LAIQON's AuMs stood at € 6.5bn (+8% yoy), implying a current valuation of 1.3% of AuM, while other asset managers are typically valued between 1.5% and 4% of AuM. On top of that, the € 65m standalone value of LAIC (i.e., € 52m for 80% ownership) explains 57% of the current market capitalization, while accounting for less than 9% of AuM. 

Therefore, we regard LAIQON as undervalued and reiterate our BUY recommendation. As a result of the decreased net debt position by € 7m (€ 0.38 per share), our DCF-based PT increases slightly to €  9.10 (old: € 8.70).

You can download the research here: http://www.more-ir.de/d/30379.pdf
For additional information visit our website: www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
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