The Luxembourg Government would, according to Reuters, bid c. € 100m for a 10% stake in (0,35 EUR, -3,61%) BIL, excluding AM and excluding the 50% stake in Investor Services. This would value the entire company at € 1bn.
The valuation used is consistent with the figures that were circulating in the market so far. See also our October 11, 2011 note “Birth of a fixed-income hedge fund”.
Our View:
We still believe that at this stage we cannot make a proper valuation of the Group since we do not know what scope we are covering, not the proceeds of divestments or the cost of carry (likely negative) of the run-off book that will remain with after the break-up of the Group.
Conclusion:
We maintain our Reduce rating and € 0.10 target