Friday, January 21

Clemente’s replacement at Merlin Properties opens an internal war and bleeds action

Banco Santander’s intention to relieve Ismael Clemente as CEO of Merlin Properties has opened an internal war in the Socimi and bleeds its listing on the stock market. Its shares are down about 6 percent today.

Banco Santander is Merlin’s main shareholder, with 22.2 percent of the capital, and in recent dates the differences between the non-executive chairman appointed by the bank, Javier García Carranza, and Ismael Clemente have intensified.

In this way, the board of directors of the company raises the relief of Ismael Clemente, who is the CEO of the company since its inception.

But the differences between the management team of the somici and the main holder of the shares opens a corporate governance crisis that has already alerted the National Securities Market Commission (CNMV).

The body chaired by Rodrigo Buenaventura has requested information from the company in this regard, given that this division on the board is affecting the Socimi’s stock price.

Merlin Properties is expected to issue a relevant fact, although internal company sources acknowledge that both parties are preparing for a war “that is only just beginning.”

Clemente’s resignation would be bad news for action

For Bankinter analysts, Clemente’s departure would be bad news for value since the still high uncertainty about office and shopping center assets, which represent about 70 percent of its assets, is now joined by the doubts about your management team.

And more than one manager like Clemente who was on the management team since the company was founded 8 years ago.

The same opinion is held by the Banco Sabadell broker. “The departure of Ismael Clemente, and his team, would be bad news for the company because enjoys the recognition of the sector, and the marketafter doing an excellent job at the Socimi ”, they emphasize.

From Renta4, the analysts also assure that if the departure of Clemente is confirmed, which in these eight years of management has led to the Socimi “to become the largest real estate agency on the Iberian Peninsula”, the share price will be affected.

They add that “this type of news could increase the risk of paper outflow” or the possibility that Banco Santander carries out a placement of all of its participation or a part.

A divided council with numerous independents

On the board of directors held last week, the departure of Clemente was already considered, but the measure did not have the necessary support since Banco Santander only has 3 seats of the 13 that make up the council.

This division on the board makes Banco Sabadell analysts think that “in the end, Clemente will not leave.”

Strong impact on action

Merlin’s good record on the stock market can be truncated, because today the stock falls almost 6 percent.

Although, for the moment, the only broker that has lowered its recommendation for this division is Bankinter, which now recommends selling from its previous neutral advice.

According to the consensus of analysts collected by Bloomberg, 71.4 percent advise buying, compared to 14.3 percent to hold and 14.3 percent to sell.

The target price stands at 10.62 percent, which compared to the last price of 8.99 euros at which the value is listed represents a potential of 18.1 percent.

Although there are analysts such as Alantra who believe that the value may skyrocket to 12.20 euros. In JB Capital Markets they think it could go up to 12 euros, while GVC Gaesco places the target price at 11.38 euros.

Among the reasons that analysts list for maintaining confidence in the value, the good resistance shown by the company to the pandemic stands out.

Thus, the benefit per share amounted to 0.54 euros in the third quarter, more than double the figure for the same period in 2020. Turnover was 376 million euros, ebitda was 296 million and net profit amounted to 482 million.

The net value of the assets stands at 6,733 million euros (14.33 per share), which represents an annual growth of 19.2 percent.