BKW - Brickworks Limited

[Dona Ferentes]

Soul Patts, Brickworks agree to $14b merger; $500m raise launched​

Investment house Soul Patts is set to merge with Brickworks, forming a $14 billion ASX-listed investments, private capital, property and building products giant..

 

[qldfrog]

Soul Patts, Brickworks agree to $14b merger; $500m raise launched​

Investment house Soul Patts is set to merge with Brickworks, forming a $14 billion ASX-listed investments, private capital, property and building products giant..

View attachment 200731

View attachment 200730

I had buy pending for sol and own some bkw, so probably a good thing for me

 

[galumay]

Finally! LOL!

 

[divs4ever]

Finally! LOL!

logical , but i was expecting SOL to do different moves

slightly inconvenient is i hold SOL and BKW in different portfolios

maybe very inconvenient is the holdings i have where SOL is a major share-holder ( like NHC , LAU , AIS etc etc etc )

will SOL carry on basically as usual .. a fat-walleted investment vehicle , or will it roll up the sleeves more often ?

 

[bigdog]

BKW ANNOUNCEMENT

2/06/2025 8:47:51 AM 17 Investor Presentation - Merger of Soul Patts and Brickworks

The Brickworks share price is up 22% to $33.60 on Monday after announcement

Investors have been buying this building products company's shares after it announced plans to merge with Washington H. Soul Pattinson & Co Ltd (ASX: SOL). This deal will see Brickworks shareholders receive 0.82 shares in a newly formed entity, TopCo, for each share held. This arrangement initially valued Brickworks shares at $30.28, which was a 10.1% premium to their previous close. However, with the Soul Patts share price rising strongly today, it has boosted the value of the consideration.

 

[divs4ever]

Trading Update – 2H25

i hold BKW and SOL

i am guessing the SOL-BKW merger will complete will the merged SOL use the US footprint to offer financial services/products in the US or maybe use the US presence to access North American acquisitions

 

[bigdog]

After soaring 36% this year, does Macquarie forecast more upside for Brickworks shares?​

Brickworks shares made headlines last month after the company revealed it would be merging with Soul Patts. As reported back then by The Motley Fool's James Mickleboro, the deal will see Brickworks and Soul Patts combine under a newly capitalised ASX-listed entity. This will be known for now as TopCo, creating a diversified powerhouse with greater scale, a stronger balance sheet, and a simplified corporate structure.

Soul Patts' CEO, Todd Barlow, described the merger as "making a lot of strategic and financial sense". He said it would simplify the structure, add scale, and create a more investable company.

Both Brickworks and Soul Patts shareholders appeared to agree, with their share prices rising 27% and 17% respectively that day.

For the year to date, Brickworks shares are up an impressive 36%.

Six month trading chart is excellent

 

[divs4ever]

After soaring 36% this year, does Macquarie forecast more upside for Brickworks shares?​

Brickworks shares made headlines last month after the company revealed it would be merging with Soul Patts. As reported back then by The Motley Fool's James Mickleboro, the deal will see Brickworks and Soul Patts combine under a newly capitalised ASX-listed entity. This will be known for now as TopCo, creating a diversified powerhouse with greater scale, a stronger balance sheet, and a simplified corporate structure.

Soul Patts' CEO, Todd Barlow, described the merger as "making a lot of strategic and financial sense". He said it would simplify the structure, add scale, and create a more investable company.

Both Brickworks and Soul Patts shareholders appeared to agree, with their share prices rising 27% and 17% respectively that day.

For the year to date, Brickworks shares are up an impressive 36%.

Six month trading chart is excellent
View attachment 202944

View attachment 202943

something to watch in this merger is what happens to the property BKW owns and the real estate development skills BKW has accumulated

what will be an uneasily fit is the merger of SOL which is better known for it's administrative and financial skills while BKW is definitely geared towards industrial and ( non-metallic resources

financially this merger should be as smooth as silk , but in reality ( without closing BKW's industrial arm ) ?

i hold both SOL and BKW

(in comparison i am thinking the WES take over of the Coles-Myer empire a couple of decades back )

 

[Dona Ferentes]

Brickworks comprises four divisions – Building Products Australia, Building Products North America, Industrial Property, and Investments. Building Products Australia includes Austral Bricks, the country’s largest bricks producer, and other leading brands such as Austral Masonry and Bristile Roofing. Building Products North America is the leading brick producer in the north-east of the United States and includes the flagship brand of Glen-Gery.

On surplus land assets, Brickworks has developed a portfolio of industry property assets in conjunction with Joint Venture partner the Goodman Group. These facilities help its customers meet the supply chain needs of the growing digital economy. More information:
www.brickworks.com.au

 

[Garpal Gumnut]

Are there any estimates of what the post merger value of TopCo will be. There are difficult decisions and calculations to be made.

gg

 

[Dona Ferentes]

Are there any estimates of what the post merger value of TopCo will be. There are difficult decisions and calculations to be made.

gg

$13.1B

.
but harder on a per share basis
... fresh $500m equity injection (dilution)
... but lower admin, one board, debt refinanced ==> attractive on balance sheet. And a few intangibles

 

[bigdog]

Brickworks Limited (ASX: BKW) has been a reliable compounder over time, thanks to its strong-performing core business and a valuable stake in Washington H. Soul Pattinson (ASX: SOL).

At the time of writing, Brickworks shares are roughly 5% off all-time highs, and long-term shareholders have likely made a good return. But with earnings season just around the corner, is it a buy, hold, or sell?

What the brokers are saying:

Macquarie recently maintained a neutral rating and a price target of $31.70 per share. The broker expects strong performance in the property division, with 2H FY25 EBITDA in this division far exceeding the first half of the year.

However, performance in the building products division is expected to remain sluggish in both Australia and the US. North American operations, in particular, continue to underwhelm, with soft market conditions putting pressure on earnings.

Analysts at UBS, on the other hand, cut their rating from buy to neutral, noting the recent share price appreciation following the announcement of the Brickworks – Soul Patts merger. The broker, however, lifted its price target to $34.25 (from $29.00), driven primarily by mark-to-market gains in Brickwork's listed investment portfolio (which includes Soul Patts).

Earnings picture: Mixed

The upcoming result will likely show strength in the property division and modest improvement in Australian building products. However, UBS highlights that US operations for building products are still facing headwinds.

Both brokers seem to agree that following the recent "merger gains", there is not much of a near-term catalyst for the share price to rise significantly higher.

 

[Garpal Gumnut]

Brickworks Limited (ASX: BKW) has been a reliable compounder over time, thanks to its strong-performing core business and a valuable stake in Washington H. Soul Pattinson (ASX: SOL).

At the time of writing, Brickworks shares are roughly 5% off all-time highs, and long-term shareholders have likely made a good return. But with earnings season just around the corner, is it a buy, hold, or sell?

What the brokers are saying:

Macquarie recently maintained a neutral rating and a price target of $31.70 per share. The broker expects strong performance in the property division, with 2H FY25 EBITDA in this division far exceeding the first half of the year.

However, performance in the building products division is expected to remain sluggish in both Australia and the US. North American operations, in particular, continue to underwhelm, with soft market conditions putting pressure on earnings.

Analysts at UBS, on the other hand, cut their rating from buy to neutral, noting the recent share price appreciation following the announcement of the Brickworks – Soul Patts merger. The broker, however, lifted its price target to $34.25 (from $29.00), driven primarily by mark-to-market gains in Brickwork's listed investment portfolio (which includes Soul Patts).

Earnings picture: Mixed

The upcoming result will likely show strength in the property division and modest improvement in Australian building products. However, UBS highlights that US operations for building products are still facing headwinds.

Both brokers seem to agree that following the recent "merger gains", there is not much of a near-term catalyst for the share price to rise significantly higher.

View attachment 205109

View attachment 205110

This brings up the question as to whether the stock price combined will rise or fall with the merger.

gg

 

[bigdog]

 

[Dona Ferentes]

done deal

SOL Share Scheme Resolution
• 96.84% of SOL Shareholders present and voting at the SOL Share Scheme Meeting were in favour of the SOL Share Scheme Resolution; and
• 92.42% of the total number of votes cast by SOL Shareholders at the SOL Share Scheme Meeting were in favour of the SOL Share Scheme Resolution.

BKW Share Scheme Resolution
• 97.40% of BKW Shareholders present and voting at the BKW Share Scheme Meeting were in favour of the BKW Share Scheme Resolution; and
• 98.81% of the total number of votes cast by BKW Shareholders at the BKW Share Scheme Meeting were in favour of the BKW Share Scheme Resolution