Syensqo SA: Not a (nove)care in the world about reviewing portfolio

研报英文原文证据摘录

Syensqo SA: Not a (nove)care in the world about reviewing portfolio

P&C strategic review

Per the 21st May press release, “Syensqo announces that it has initiated a strategic review

of its Performance & Care segment. This is aligned with the Company’s intention to focus

on becoming a pure play specialty materials and advanced technologies company, with a

greater exposure to structurally attractive end markets including aerospace and defence,

electronics, healthcare, energy and advanced mobility applications. Since the start of the

year, we have undertaken a strategic assessment of our long-term direction and value

creation priorities. In addition, we are fully focused on accelerating our growth trajectory,

driving more consistent execution, sharpening our capital discipline as well as improving

cash flow delivery.”

Given the use of the word ‘focus’, we believe the intention will be to divest the business.

No timeline has been set and the process could be complicated if different logical

owners are identified for the two respective assets – Novecare & Tech Solutions. We

have previously questioned the industrial logic of why these assets belong in a portfolio

with Materials (polymers/composites). New CEO Mike Radossich looks well placed to

make an informed decision given he has effectively worked in both divisions at points in

his career. Per Mr Radossich’s comments on recent earnings calls, we detect a sense of

urgency from the board to ‘accelerate’ steps towards value creation in light of the poor

share price performance and the use of c.EUR700mn of shareholders money to execute

the spin and associated restructuring.

To recap the assets under strategic consideration:

Novecare: 2025 sales were EUR1.35bn and we would estimate an EBITDA margin around

15%.