The Virtus Health Ltd (ASX: VRT) share price is soaring. It’s up 30% after the fertility, diagnostic and day hospital business announced it had received a takeover bid.

Virtus Health share price jumps on takeover approach

The fertility company said it has received an unsolicited, non-binding indication of interest from the private equity group BGH Capital to buy the business.

BGH Capital’s proposed cash value is $7.10 per Virtus Health share, which would be reduced by any dividends declared or paid after today’s date.

The private equity outfit has been busy accumulating shares in the ASX share. BGH Capital told Virtus that it has already acquired 8.5 million shares, representing a 9.99% interest in Virtus at $7.10 per share.

BGH Capital has also entered into a ‘total return swap’ with UBS regarding 7.5 million shares, that hasn’t yet settled, representing a 10% interest in Virtus. This total return swap provides BGH with an option to “elect physical settlement of that 10.00%” subject to takeover laws and regulations.

What price would other shareholders get?

BGH has stated the Virtus share price offer will be $7.10 per share for all Virtus shareholders entirely in cash and that it also proposes a cash and scrip/share alternative to major fertility specialist shareholders and other certain affiliated shareholders to enable them to continue their investment in Virtus.

The offer is only conditional

Implementing the takeover is subject to a number of conditions including:

• Satisfactory completion of due diligence
• Virtus not selling or agreeing to sell any material assets
• No material changes to Virtus or financial markets
• Finalising debt for a binding proposal
• Approval by BGH’s investment committee
• Unanimous recommendation by the Virtus board of directors to vote in favour of the offer (in the absence of a superior proposal and subject to an independent expert concluding that the proposal is in the best interest of Virtus shareholders.)

Virtus board response

The Virtus board said it had commenced an assessment of BGH’s proposal.

However, the board noted that shareholders don’t need to take any action regarding the proposal at this stage. There is no certainty that the proposal will result in a transaction.

It has appointed Jefferies as financial advisor and Gilbert and Tobin as the legal advisor.

Virtus Health share price snapshot

With the Virtus Health share price reaching $6.76, it’s up 24% over the last year.

However, the offer is below where Virtus shares were trading in August 2021.

The post Virtus Health (ASX:VRT) share price soars 30% on takeover bid appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Virtus Health Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The HUB24 Ltd (ASX: HUB) share price is in the red this morning after changes were made to an acquisition proposition posed to Class Ltd (ASX: CL1).

Following discussions between the companies, HUB24 has upped its cash offer and given Class shareholders access to its first-half dividend.

At the time of writing, the HUB24 share price is $28.61, 0.49% lower than its previous close.

At the same time, the Class share price is $2.635, 0.96% higher.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.34%.

Let’s take a closer look at the changes made to HUB24’s takeover offer.

HUB24 share price struggles on new acquisition terms

The share price of both HUB24 and Class are on the move this morning, albeit in different directions, following changes to the takeover offer posed to software developer Class by fintech company HUB24.

Originally, HUB24 offered Class shareholders 10 cents cash per share, as well as 1 HUB24 share for every 11 Class shares held.

Now, HUB24 will provide Class investors with 12.5 cents per share, with the issued scrip to include any dividends — and resulting franking credits — it might pay for the first half of financial year 2022.

However, there’s a downside for Class shareholders. Class has agreed not to pay any dividends, including any ordinary dividend of up to 2.5 cents for financial year 2022.

The Class board has recommended the company’s shareholders vote in favour of the transaction.

A scheme booklet further detailing the proposed transaction is expected to be made available tomorrow.

According to HUB24, the acquisition will likely accelerate its plan to be a leading provider of integrated platforms, technology, and data solutions for the financial sector.

It’s also expected to create competitive advantages and diversify both companies’ revenues.

When the proposed acquisition was first announced on 18 October, the Class share price shot up a massive 61.3%.

That same day, the HUB24 share price fell 0.88%.

The post HUB24 (ASX:HUB) share price slumps on upped takeover terms appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Hub24 Ltd. The Motley Fool Australia owns and has recommended Class Limited. The Motley Fool Australia has recommended Hub24 Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Altium Limited (ASX: ALU) share price has come under pressure this morning.

In early trade, the electronic design software company’s shares are down 2% to $42.74.

Why is the Altium share price falling?

While there is broad weakness in the tech sector today, the main driver of the Altium share price decline appears to be a broker note out of Bell Potter.

According to the note, the broker has downgraded the company’s shares to a hold rating but with an improved price target of $45.00.

Based on the current Altium share price, this implies potential upside of approximately 5% over the next 12 months.

Why did Bell Potter downgrade its shares?

The note reveals that Bell Potter made the move on valuation grounds after a strong gain over the last couple of months.

For example, prior to today, the Altium share price was up 29% since this time in October and trading within a fraction of its record high.

The broker explained: “At our updated PT of $45.00 the total expected return is only 4% so we downgrade our recommendation from BUY to HOLD. The key risks to our downgrade are, firstly, the company does upgrade its FY22 guidance at the result in February but we believe this is already partly reflected in the share price.”

“Secondly, an increased takeover offer from Autodesk and while we believe there is a reasonable chance of this occurring we do not believe there is a high probability. And thirdly a transformative and material acquisition but, as highlighted with Supplyframe, such opportunities are rare and difficult to close so again we do not attach a high probability to such a deal occurring,” it added.

What is the broker expecting in FY 2022?

Bell Potter continues to forecast revenue and EBITDA of US$218 million and US$80 million, respectively, in FY 2022. It notes that this is “at the top end or slightly higher than the guidance ranges of US$209-217m and US$72-80m.”

However, a potential positive for the Altium share price is that Bell Potter’s analysts “also continue to see some prospect of an upgrade to the guidance at the release of the 1HFY22 result in February especially after the company said at the AGM that it is confident that it is not likely to be at the low end of the guidance range.”

The post Altium (ASX:ALU) share price falls amid broker downgrade appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Altium. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The AdBlue crisis doesn’t seem to be abating even as new supplies are set to hit our shores and, as with any crisis, there will be ASX winners and losers.

The clock is ticking as Australia is due to run out of the fluid that limits noxious diesel exhaust within weeks. This could cripple the country’s supply chains as trucks and other heavy machinery might not be able to operate without the additive.

ASX shares getting a sales boost

Panic buying is driving sales of AdBlue with Super Retail Group Ltd (ASX: SUL) and Bapcor Ltd (ASX: BAP) surging.

Super Retail owns the Supercheap Auto chain while Bapcor runs Autobarn. Some stores have reportedly run out of stock. Those that still have supplies have imposed customer limits.

Thankfully there have been no reported punch-ups in the aisle like those we saw at Woolworths Group Ltd (ASX: WOW) during the Great Toilet Paper Run – at least not yet.

Running on empty

Australia’s largest supplier of AdBlue, DGL Group Ltd (ASX: DGL), has only around six weeks of stock left.

Australia will get a new supply of AdBlue from Indonesia and has approached several Middle Eastern countries to source urea, AdBlue’s principal ingredient.

However, the disruption to shipping lines caused by the global pandemic is complicating the picture. Even if Australia can find supply, it may take a while before it gets to our shores.

What is AdBlue and urea?

China, one of the top five largest exporters of urea, has effectively stopped its export to control surging domestic prices.

AdBlue is made by mixing organic compound urea and deionised water. It is essential to cut harmful emissions from diesel engines as it converts nitrogen oxides into nitrogen and water.

The chemical is contained in a separate tank on diesel vehicles. Motorists can fill up on AdBlue at petrol stations like those run by Ampol Ltd (ASX: ALD) and Viva Energy Group Ltd (ASX: VEA). This, of course, assumes that you can find stock as petrol stations are also struggling to find supply.

Other impacts that ASX investors should be wary of

Urea is also used as fertiliser and shortages can impact food security. This is why China is so keen on keeping as much of it as it can to put downward pressure on prices.

At this stage, no one is thinking of the impact on food prices as the AdBlue emergency is stealing the limelight. But perhaps we could soon start hearing about this, especially as inflation fears continue to grip markets — unless demand and supply are brought back into balance.

Experts blame soft commodity prices for the larger than expected demand for urea. Farmers around the world are planting crops to capitalise on higher agricultural prices.

It seems Australia isn’t the only country scrambling to find alternative supplies either. This means the price of urea is likely to stay elevated for longer, even though there are alternative fertilisers that farmers could use.

The post ASX shares that could be impacted by AdBlue shortage appeared first on The Motley Fool Australia.

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Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Super Retail Group Limited. The Motley Fool Australia owns and has recommended Super Retail Group Limited. The Motley Fool Australia has recommended Bapcor. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The IGO Ltd (ASX: IGO) share price has gained 57% in 2021 and opened this morning at $10.58 per share.

The Allkem Ltd (ASX: AKE) is up 102% year-to-date, opening at $9.16 per share this morning.

You may be more familiar with Allkem’s previous name, Orocobre. Following a shareholder vote on 30 November, the company officially began trading under its new name, Allkem, last Monday 6 December.

Both S&P/ASX 200 Index (ASX: XJO) miners are well-exposed to the global push to electrification, with world-class lithium assets, alongside other metals like copper that are in high demand amid rapid EV growth.

But at the current Allkem and IGO share prices, which company offers ASX 200 investors better value?

Is the IGO share price a better buy than Allkem?

For the answer to that question, we defer to Joseph Koh, a portfolio manager in Schroders’ Australian equities team.

When asked which lithium focused ASX shares he held “to capitalise on the shift to EVs”, Koh said (quoted by the Australian Financial Review):

IGO; its Greenbushes asset is one of the lowest cost, highest grade hard rock lithium resources in the world. And the largest. It also has a lithium hydroxide refinery, with the potential to quadruple capacity with additional trains to cope with increasing throughput needs in the future.

Koh noted that IGO’s assets go well beyond its Greenbushes lithium project:

IGO also produces nickel, another key component of lithium-ion batteries, from its Nova mine. Production volumes have been at or above target, while costs have been well managed, which compares favourably against other miners who have struggled with these two metrics due to COVID-19 restrictions on labour movement and other cost pressures.

So how does the IGO share price stack up against Allkem (formerly Orocobre)?

According to Koh, “We did hold Orocobre in the past, but as its valuation got increasingly stretched, we consolidated our exposure to IGO.”

How has IGO been performing?

As mentioned up top, the IGO share price is up 57% since 4 January this year. Over the past 12 months shares have gained 69%, and they’re up 5% since this time last month.

The post Is the IGO (ASX:IGO) share price a better buy than Allkem? appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The CSL Limited (ASX: CSL) share price is frozen in time amid a highly anticipated announcement.

CSL, the nation’s largest biotechnology company, is expected to reveal the verdict on a $US12bn (A$16.74bn) deal to acquire Swiss firm Vifor Pharma today. The potential acquisition target is a specialist in iron deficiency treatments, pulling in ~A$2.66 billion in revenue during the trailing 12-month period.

This follows nearly two weeks of rumours regarding a potential transaction stemming from 2 December. However, both biotechnology companies confirmed they were in talks yesterday.

What is on the table?

Investors are awaiting the release of an announcement from CSL today to discover the details of a potential deal with Vifor. Now that the CSL share price has entered a trading halt, it seems we are on the brink of knowing exactly how it would look.

Yesterday, reports indicated there was no certainty of a transaction. As reported by The Australian, a spokesperson for CSL suggested that there was no hard-set decision on if and when a transaction would eventuate.

Meanwhile, sources privy to the discussions said that the Australian biotech would look to raise ~US$4 billion to make the deal. If the company goes ahead with acquiring Vifor, it would mark CSL’s first acquisition in more than 10 years.

Despite the magnitude of a possible acquisition, some analysts are hazy on the strategic rationale behind such an addition. For instance, Macquarie analysts David Bailey and Rachael Harwood said:

[There is] limited obvious product alignment. As such, the potential strategic rationale for the transaction is not immediately apparent.

Shareholders will be hoping an acquisition gives rise to a renewed rally in the CSL share price. In the past, the biotech giant has delivered phenomenal returns. However, since the beginning of this year, the company’s shares have gained an underperforming 4.3%.

What’s next for the CSL share price?

According to the announcement, the CSL share price will remain frozen until the company publishes its announcement regarding a potential material acquisition and associated capital raising. Either that or shares will recommence trading on 16 December 2021 — whichever comes first.

Currently, Australia’s second-largest listed company holds a market capitalisation of $135.9 billion.

In terms of free cash, CSL reported US$1.814 billion of cash and cash equivalents at the end of June. Additionally, the biotech has ~US$4.6 billion of debt on its books.

The post CSL (ASX:CSL) share price enters halt as $16.7b Vifor deal expected to be announced appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Woolworths Group Ltd (ASX: WOW) share price is under pressure on Tuesday.

At the time of writing, the retail giant’s shares are down 7% to $37.60.

Why is the Woolworths share price sinking?

Investors have been selling down the Woolworths share price this morning after the retail conglomerate released an update on its performance during the first half of FY 2022. That update revealed that Woolworths has had a challenging six months.

The Australian Food business reported sales growth of 2% during the second quarter. This compares to first quarter growth of 3.9%, bringing its first half sales growth to 3% year to date.

Management notes that since the easing of lockdowns in NSW and Victoria during October, sales in Australian Food have moderated as customers return to more normal shopping habits. In addition, sales have been impacted by inclement weather and the ongoing decline in tobacco sales.

Unfortunately, as well as its softening sales, the segment has incurred significant costs relating to COVID-19. As a result of these direct and indirect costs, Australian Food EBIT is expected to be $1,190 million to $1,220 million during the first half. This compares to FY 2021 first half (27 weeks) Australian Food EBIT of $1,329 million.

Elsewhere, the BIG W business delivered an improved performance during the second quarter. However, its sales were still down 3.3% over the prior corresponding period. In light of this, BIG W EBIT is expected to be just $20 million to $30 million for the half, down from $133 million a year earlier.

Finally, the New Zealand Food business has been the star performer. Management advised that its sales growth has been strong in first half, benefitting from extended lockdowns and higher inflation in the country.

“One of the most challenging halves”

Woolworths Group CEO, Brad Banducci, revealed that the first half was an extremely challenging period.

He explained: “The first half of F22 has been one of the most challenging halves we have experienced in recent memory due to the far-reaching impacts of the COVID Delta strain and its impact on our end-to-end stock flow and operating rhythm. We have continued to put the health, safety and wellbeing of our customers and team first in the context of this challenging and volatile operating environment.”

“The ongoing material costs of operating in a COVID environment has impacted our expected earnings in H1. COVID has had a significant impact on costs, even more so than last year due to the combination of both direct COVID-related costs, together with the indirect impacts from disruption caused by COVID. This includes the significant disruptions we have seen across the end-to-end supply chain, and the material inefficiency this causes in our stores, distribution centres and transportation,” he added.

The post Woolworths (ASX:WOW) share price sinks 7% amid “one of the most challenging halves” appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Nearmap Ltd (ASX: NEA) share price has been a positive performer on Tuesday.

In morning trade, the aerial imagery and location intelligence company’s shares are up 10% to $1.62.

Why is the Nearmap share price jumping?

Investors have been bidding the Nearmap share price higher on Tuesday following the release of a trading update.

According to the release, the company expects the Annualised Contract Value (ACV) of its North America portfolio to surpass the ACV of its Australia and New Zealand portfolio for the first time in the near future.

In fact, management suspects this milestone could be achieved by the end of the first half. After which, it expects this side of the business to continue its growth and become the majority of Group ACV in the future as that market continues to accelerate.

The release explains that North America ACV has just surpassed US$50 million, taking group ACV beyond US$100 million. This compares to North American ACV of US$44.5 million at the end of FY 2021.

This puts Nearmap on course to achieve its FY 2022 ACV guidance of A$150 million to A$160 million on a constant currency basis, which represents an increase of 17% to 25% year on year.

“Very positive momentum”

Nearmap’s Managing Director and Chief Executive Officer, Dr Rob Newman, commented: “This historical milestone for Nearmap follows the very positive momentum we’re seeing in our business in North America.”

“We purposefully refined our go-to-market strategy in the region at the beginning of FY21 to focus on three core industries: government, insurance, and roofing. This approach was aligned to our strengths and follows strong demand from customers in these sectors. Since that time, we have delivered consecutive record half-year results. We’re also seeing this momentum continuing into FY22, which validates our strategy and our execution.”

This should be supported by the company’s expanding footprint in the key market.

Dr Newman explained: “Nearmap will continue to invest in this strategic market. We are doubling the coverage footprint in FY22 of our US capture program to ~80% of the population up to three times each year. Following a successful pilot, we’re also expanding access to all sectors in North America our ‘Nearmap ImpactResponse’ product to assist disaster relief efforts following catastrophic weather.”

The post Nearmap (ASX:NEA) share price jumps 10% on strong US growth appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Nearmap Ltd. The Motley Fool Australia owns and has recommended Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Siteminder Ltd (ASX: SDR) share price has been a strong performer since hitting the ASX boards last month.

Since listing with an IPO price of $5.06, the leading open hotel commerce platform provider’s shares have risen 21%.

Can the Siteminder share price keep rising?

One leading broker has given its verdict on the Siteminder share price this morning. And while it isn’t recommending its shares as a buy, it still sees reasonable upside ahead.

According to a note out of Goldman Sachs, its analysts have initiated coverage on the company with a neutral rating and $6.90 price target.

Based on the current Siteminder share price of $6.15, this implies potential upside of approximately 12% for investors over the next 12 months.

What did the broker say?

Goldman notes that Siteminder is operating in 150 countries with a current total addressable market estimated to be A$9.3 billion per annum. This means that the company has penetrated just 1% of this market.

The broker explains that this market “comprises A$2.5bn in its core hotel segment (1mn properties, c.70% using manual solutions), A$4.4bn from transactions (SDR sharing property GMV), and A$2.4bn from alternative accommodation through extending Little Hotelier.”

While Goldman acknowledges that the company’s revenue growth has stalled because of COVID-19, it expects this to change. The broker believes a resumption in global travel, accelerating small/medium business hotel software adoption, and its expanded product offering to underpin a revenue compound annual growth rate of 21% between FY 2021 and FY 2025.

Why neutral?

Given its positive outlook for the company, the broker explained why it is only initiating coverage with a neutral rating.

Goldman commented: “Although acknowledging SDR’s strong growth prospects and positive risk-reward, we initiate at Neutral given: (1) Uncertainty around the phasing of the global travel recovery; (2) Bottom quartile unit economics (even on a normalised basis); (3) Execution and competition risks in SDR growth markets; and (4) Growth adjusted valuation multiples that are in-line with peers. Our 12-month target price of A$6.90 is based on our EV/GP methodology – using 18X our FY23 GP estimate.”

“This multiple is in-line with ANZ peers when adjusting for GP growth outlook and covid-19 impacts on FY22 (-ve SDR, +ve peers). Our NPV sensitivity analysis implies potential LT valuations of A$15.00/A$3.80, suggesting meaningful upside on successful execution,” it added.

The post Top broker gives its verdict on the Siteminder (ASX:SDR) share price appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Northern Star Resources Ltd (ASX: NST) share price could be a bargain buy following the CEO’s latest purchase.

The Australian gold miner’s shares have fallen by almost 15% in a month as the price of gold continued to sink. And yesterday’s market session didn’t help, with the company’s share price edging 0.66% lower to $9.04 at the closing bell.

CEO buys more Northern Star shares

Last week, Northern Star managing director and CEO, Stuart Tonkin made an on-market transaction buying more of the company’s shares.

In total, 50,000 Northern Star shares were purchased at an average price of $8.86 per share or $443,000 worth. The sale increase Mr Tonkin’s existing holding by 4.2%, taking advantage of the recent share price weakness.

In addition, non-executive director, John Richards also picked up more Northern Star shares, adding 5,000 to his portfolio. Although, Mr Richards paid a slightly higher price at $9.10 per share.

When news broke out on 6 December, investors sent Northern Star shares around 3% higher over the following two days. However, it wasn’t enough to keep the confidence afloat, with the company’s shares erasing those gains since.

While the Northern Star share price is near these levels, it’s clear that the CEO believes this is an attractive investment.

Furthermore, Swiss investment bank, UBS upgraded its outlook on Northern Star shares last week. Its analysts slapped a “buy” rating from “natural”, but cut the price target by 21% to $11.20 apiece.

Macquarie also jumped in but with a more bullish view, raising the price target by 15% to $15 per share.

Based on the last closing price, this implies an upside of 20% for UBS and 40% for Macquarie.

About the Northern Star share price

Over the last 12 months, Northern Star shares have failed to take off, dropping by almost 30%. Investor sentiment weakened following a sharp fall in the spot price of gold this year.

On valuation grounds, Northern Star commands a market capitalisation of approximately $10.53 billion, with roughly 1.16 billion shares outstanding.

The post Are Northern Star (ASX:NST) shares cheap? The CEO must think so, here’s how many he snapped up last week appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras owns Northern Star Resources Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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