WH Group gives back the bacon

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WH Group gives back the bacon with a buyback of up to $1.9 billion, says JennHughes13:

in Asia where cash hoards abound. Perhaps it is American influence: the company was formed by the takeover of Smithfield Foods by China’s Shuanghui in 2013, and the enlarged entity subsequently listed in Hong Kong.

WH Group was battling African swine fever before the pandemic took its toll, knocking its valuation to a subdued average 10 times forecast earnings in the past two years. With last year’s EBITDA more than twice net debt, it can easily take on the borrowing to fund the repurchases. The HK$7.8 a share price offered represents only a moderate 17% premium. If the shares jump enough on the deal, the company won’t even need to spend the funds.

 

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