USU Software AG
Original-Research: USU Software AG (von NuWays AG): HOLD

Original-Research: USU Software AG – from NuWays AG

Classification of NuWays AG to USU Software AG

Company Name: USU Software AG
ISIN: DE000A0BVU28

Reason for the research: Update
Recommendation: HOLD
from: 14.03.2024
Target price: 17.00
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Philipp Sennewald

Delisting intention a punch in the face for investors

On Tuesday evening, USU Software published an ad-hoc stating the intention
to delist the company from the stock exchange. Here is what you need to
know:

Supported by the supervisory board, the management board of USU aims to
delist the company. In order to do so, management consulted majority
shareholder AUSUM (51% of voting rights), the investment vehicle of founder
Udo Strehl, whether it would be prepared to make a delisting offer, which
is the prerequisite for delisting a company that is listed in the prime
standard.

On Tuesday, AUSUM informed the management that it is seeking an agreement
to finance such an offer and that the respective negotiations are in an
advanced stage. Moreover, AUSUM informed the company that the offer price
should be expected to be largely in line with the equivalent to the
statutory minimum price, e.g. the volume-weighted average price of the past
six months, in accordance with section 39 of the German Stock Exchange Act.
According to our calculations this should result in an offer price of c. €
17.00 per share (€ 16.97 according to Bloomberg).

During yesterday’s conference call, CEO Oberschmidt stated that the main
reason for the decision was the “sustained undervaluation” of USU by the
stock market, which among others would make it difficult to use the shares
as M&A currency in a value accretive manner. In our view, this argument is
at least questionable as shares only dropped to current levels following
the company’s profit warning in August. Moreover, management stated that it
is seeking substantial investments in order to considerably expand its
product business following the delisting. To finance this, management aims
to carve out the product business and get an external partner on board.
However, management did not provide any details on the exact nature of such
a partnership, stating that the process is in a “very early stage”.

Our view: We agree with management regarding the undervaluation of the
shares and reiterate our intrinsic fair value of € 30 per share. However,
we advise investors who have no intention of being invested in a highly
illiquid asset to tender their shares once the delisting offer has been
made. For the time being, we change our recommendation to HOLD and reduce
our PT to € 17.

You can download the research here:
http://www.more-ir.de/d/29159.pdf
For additional information visit our website
www.nuways-ag.com/research.

Contact for questions
Die Analyse oder weiterführende Informationen zu dieser können Sie hier downloaden: www.nuways-ag.com/research.
NuWays AG – Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
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——————-transmitted by EQS Group AG.——————-


The issuer is solely responsible for the content of this research.
The result of this research does not constitute investment advice
or an invitation to conclude certain stock exchange transactions.