Arkema S.A. (AKE) Earnings Call Transcript & Summary

Good morning, everyone. Thank you for joining us on this call at such a short notice. I am here together with Marie-Jose Donsion, our CFO, you know well; as well as Marc Schuller, [indiscernible] representing the business. Also with us is our team. You will find a set of slides on our website, which you can download and use as a reference. As you know, we have organized this conference call as we announced this morning a project to acquire 54% controlling stake in PI Advanced Materials, PIAM. I'm very excited to announce this transaction as it is a company that we had looked at in the past and I have followed closely for some time, and the timing is now perfect to seize this fantastic one-off opportunity to broaden and strengthen our high-performance polymer range. As you know, Arkema's growth strategy is based on high value and innovative materials serving bigger trends around these 3 pillars of Adhesives, Coatings and Advanced Materials. In Advanced Materials, we have significantly strengthened our profitability over time, our geographic balance across the 3 key regions, as well as our innovation with polymer delivered PVDF and Pebax, which are all benefiting of the strong sustainability-driven growth of high-performance materials. We were missing one very high-performance polymer in our portfolio, but there are almost no opportunities in the market. Polyimide is that missing piece in our present. PIAM is an exceptional high specialty company with a relatively small size and huge potential. It stands out from PIAM as its unique with high performance polymers are perfectly positioned on megatrends and combined significant sales growth with high margins. Their offering is highly complementary to ours in terms of end market, technologies and geographies. PIAM will enable us to strengthen our geographic footprint in the faster-growing Asian region, including the strategic South Korean market and in 2 end markets at the art of growth linked to megatrends. Electric vehicles and electronics will benefit from numerous subsidies like the IRA in the U.S. and the Green Deal in Europe. Strategically, the fit is evident. We are adding a third family of polymer to our portfolio, together with polyimide and fluoropolymers as this acquisition is an important step towards our ambition to be a specialty materials leader offering innovative, highly technical and sustainable solutions. The deal is highly synergistic and we estimate that together with PIAM, we'll be able to deliver around EUR 30 million of synergy at the EBITDA level within 5 years. Let me give you a brief overview of PIAM before detailing the company's growth potential and synergies. PIAM is headquartered in South Korea listed on the Korean Stock Exchange. The company has a highly focused portfolio of polyimide, which are ultra-high performance polymer offering exceptional properties such as very high temperature resistance, flexibility, stability and electric insulation. PIAM is a leading producer of polyimides with over 30% market share serving attractive and high-growth markets, including consumer electronics and electric vehicles. Competitors for such specialty products include DuPont, Kaneka and Toray. And PIAM is very well positioned, thanks to top-of-the-range quality and a competitive cost base. In '22, PIAM generated sales of approximately EUR 200 million, virtually all in Asia, with a very strong EBITDA margin of around 30%. It benefits from a strong track record with sales growth averaging [indiscernible] per year between 2012 and 2021 before the company was impacted by the significant destocking in the consumer electronics market in '22, like the other players. PIAM will generate superior sales growth in the medium term, expected at 13% per year, faster than its underlying market, which are growing by some 9%. Supported by recent capacity expansion, this growth will be driven by PIAM's solid innovation pipeline as the company has recently successfully qualified products in high-growth and highly technical markets like 5G antennas, flexible screens or OLED displays. PIAM is also increasingly well positioned in EVs with its polyimide tests for battery cell insulation, films for flexible printed circuit boards and varnishes for motor cords, and this market will generate substantial growth in coming years. The EUR 30 million expected synergy at the EBITDA level should be progressively achieved over the next 5 years. They are driven by the promising cross-selling opportunities, which we have identified precisely, thanks to Arkema and PIAM's complementary positions in terms of market and geographies. Firstly, around 2/3 of synergy will be achieved through the growth of PIAM's sales outside of Asia, specifically by leveraging Arkema's global presence and strong customer relationships, in particular, in the U.S. and Europe. We have identified significant opportunities in advanced industrial application and in the electrical vehicle market where PIAM's product should benefit from Europe and the U.S. initiative to accelerate their own EV battery supply ships. The remaining 1/3 of synergy will be achieved by driving Arkema sales with strategic manufacturers in Asia, in particular, in Korea, thanks to PIAM's unparalleled customer intimacy in markets like electronics, EVs and batteries. We have a strong range of complementary products with PVDF, polyimides, Bostik and Sartomer also, which all have leading solutions to offer in those cutting-edge markets, and we have conveyed that PIAM will help us gain access to the key OEMs in this region. From a financial standpoint, the offer is based on a multiple of 20x the average '21-'22 EBITDA, taking into account the temporary low point of '22 in the consumer electronics market. Factoring in the full amount of synergies and organic growth, the multiple will be reduced to 8x EBITDA in 2027 and will continue to decrease in the coming years. As a matter of fact, this is really a very good timing for 3 reasons. Firstly, we are buying the asset at a trough earnings level as the exceptional macro environment of the past year led to significant destocking in the consumer electronics market where polymer players across the board were impacted. Secondly, the growth in EVs is accelerating and globalizing. And thirdly, we can benefit from recent and significant capacity additions by PIAM, which are mainly unused at the moment given the current destocking and which will support the growth we plan. For sure, I am aware of the question you may have on the current trading in light of the recent news flow in the industry. With regard to Arkema, we reaffirmed that we remain fully in line with our full year guidance, and we are completely consistent with what we said at our previous calls, even if the macro has not changed materially since the start of the year and remains rather weak. As I said earlier, with this acquisition and all the work done to reposition the portfolio in previous years, we believe that we are now -- that we have now the right technology positioning to address megatrends. Therefore, over the coming years, we will focus mainly on organic growth and our M&A policy will be focused on completing the disposal of intermediates and small bolt-on acquisitions, in particular in adhesives to continue to leverage the fragmentation of this market. I and Arkema's leadership team will talk about this in more detail during our Capital Market Day in Paris on September 27. As a conclusion, this was a great and strategic opportunity we didn't want to miss and completely consistent with our M&A strategy after the disposal of PMMA and the acquisition of Ashland's adhesives. The world is changing, and everybody is impacted by this change. The question is whether we want to stay motionless or seize the opportunities available to us. With the acquisition of PIAM and the repositioning of the portfolio that we have been working on for more than 10 years, it is clearly the second path that we have chosen. Thank you for your attention. I'm now ready together with the rest of the team to answer your question.

Thank you. [Operator Instructions] The first question is from Matthew Yates with Bank of America.

Just on the technicals of the deal, you are acquiring the controlling interest from, I guess, a single shareholder. Can you talk about the plans to acquire the remaining stake? And from a funding perspective, in order to keep the balance sheet in check, is it reasonable to assume that you have...

Your question was interrupted, so we could not catch the full question. If you can start again, I think...

That's okay. You're acquiring the majority stake of the company today, but can you talk a bit more about plans to buy out the minorities in due course? From a funding perspective, in order to keep the balance sheet in check, is it reasonable to think that you have line of sight or confidence on disposals to help release some capital that could be reinvested to fund this deal?

Okay. So maybe, Marie-Jose, you want to start with the question? Then I will complete.

Sure. So regarding actually the minority shareholders, it's a listed company in the Korean Stock Exchange. We do not intend to acquire the minority stake, so this will be fully consolidated based on the controlling stake that we are buying now at 44%. Regarding actually the disposal process, as you know, we are fully committed to the disposal of the fluorogases business and as well looking into the Asian Acrylics business. So this is definitely something that is in our radar screen and plans for the coming months.

So basically, we are doing things in parallel. They are not connected to each other if it is your question, okay? And as you know, you can never monitor exactly the timing of disposals. So -- but I would say, the determination is there. It will take the time it will take. As I've mentioned many times, there is no urgency because on the fluorogas, the economics are quite good. So we want to make sure that we have a good deal. But anyway, and without counting on that, as you could see, the balance sheet with the acquisition of the Korean asset, we remain quite strong. So I think we have this flexibility that we are happy with, and which -- so we have, at the same time, determination, but also we have this chance not to need to connect everything together.

And sorry, one question about the business. I think the press release references a significant CapEx program that's just been completed. Is there a way of translating that into a certain amount of capacity, i.e., how many years of double-digit growth can the business deliver before it has to do another significant round of CapEx?

Yes. The good thing is that you have that. In fact, if you look -- I know everything is on short notice. So it will take for everyone a few days really to go into more detail. But if you get to the presentation on the Page 8 exactly. And by the way, it's coming from PI directly, which is, as you know, a listed company. So in fact, there are developed, compared to the tradition of Arkema, but here you have really everything. So you can see that with this new capacity, which has just come on 3 months, so they have been financed, it represent on couple of years quite a significant amount and it will allow us to cover the growth for the coming years for most of it.

The 2027 covers the large majority of the...

Yes. Yes. For the next 3 years, we should be easily covered even more than that, depending on which grade exactly.

Cool, thanks.

I would say that these 2 points that you have mentioned, Matthew, are a quite good point because the first one on the 54% stake that we can consolidate 100% even if we have not made a key argument on the press release, it's a good point. It's a positive point. And the fact that on a different note, the fact that a big plan of CapEx has been finalized by PIAM before the acquisition is also quite a positive point. So -- and I take also the advantage to mention that we have visited, as you can imagine, in detail, their assets -- manufacturing asset. And frankly speaking, in our life and it was really the return of the team, we have never seen such assets, including competitors, peers and partners of this quality. So it's also -- it's not so much in the press release because we say state-of-the-art, but it's really more than state-of-the-art, it's really top-class manufacturing assets. So we are very pleased also because of that. And we are really in a position by the innovation pipeline, by the manufacturing assets, by the reputation also of PIAM in this world of electronics and batteries, we are in a position really to develop the growth of the top line for the coming years.

The next question is from Alex Stewart for Barclays.

Very interesting. I just wanted to clarify something on the synergies. Did I hear you right that 100% of the EUR 30 million of EBITDA synergies is revenue synergies, in other words, leveraging the capacity they've added? And if that's the case, should we think about the 13% revenue growth and the EUR 30 million of incremental EBITDA as one and the same thing? In other words, the EUR 30 million of EBITDA comes from 13% revenue growth per annum. I just wanted to clarify on that? And then the second thing is if I look at the consensus numbers for the company you're acquiring, there's been some pretty steep downgrades for a couple of years now, both this year and next. And the sales consensus is expecting an EBITDA in 2024 that's below the level of 2021. So why is it do you think that the current market expectations for this company don't quite match your internal expectations? I would be very interested to hear on that.

Okay. So I propose that [indiscernible] is answering the first one, and I will take the second one.

So indeed, the way we see it is that there is a strong underlying business plan, and it's a combination of Arkema and PI Advanced Materials that allow us to do the superior market growth, and their stand-alone business plan would be more complicated to grow into Europe and the U.S. in particular, and it's the combination that allows us to do that much more efficiently and much faster than as a stand-alone company.

The underlying growth is actually 13%, and it's obviously in addition that we are performing the EUR 30 million synergies that -- you are correct, are revenue synergies.

So it's 13% revenue growth per annum and then on top of that, there's additional revenue growth to achieve the EUR 30 million of EBITDA?

Yes, this is -- this is correct. And in fact, you have 3 levels. You have the -- the beauty of this deal is that the underlying demand is growing at 9% for the market we are targeting, mostly electronics and batteries, okay? Batteries being exponential, electrical vehicle. Then you have the fact that PIAM with its positioning technology, can beat and has beaten in the past this end market. And the third one is the synergy. So you have 3 levels of top-line support which are quite positive. So with regard to the PIAM evolution, I mean, our experience on that, and we have seen a lot of things going on in the industry, that you have the choice, either you buy the assets at peak conditions, at peak price, or you take advantage of a more challenging period which is the case, in fact, not for PIAM, not specifically for electronics, but which is the current trending, as you know, okay? And you take advantage of this specific period even if the vertical relatively remain high, but what is important is the absolute number based on the potential. And you take advantage of this period in order to make sure to pay it looking potential forward at original price. And this is what we have tried to do all in our life, to sell at the right moment, to buy at the right moment and this is what we will do with PIAM, and we are happy about that. Now you're right to say that PIAM is temporary, as every company which is supplying the consumer electronic -- company in consumer electronic by temporary destocking. But for us, this is okay. This is part of the equity story. We prefer to make a transaction when we buy when the market is more challenging and to accept that.

So could I just clarify one thing, again, sorry to push on this, but EUR 30 million of EBITDA from revenue synergies is, let's say, EUR 60 million, EUR 70 million of revenues. 13% of revenue growth over 5 years is about 80%. So you get 80% revenue growth over 5 years and then another EUR 60 million or EUR 70 million of revenue from the revenue synergies. So you're looking at a sort of doubling of revenue within 5 years. Is that what you were expecting?

Yes. But because you're talking about a company which has -- [indiscernible] which is inside polymer portfolio which is in billions. And they are nearly all Asia, and we bring all our footprint in Europe and U.S. So I think -- I mean, there is a big part of the world which is not touched to the -- this is why you have to separate what is the growth in the Asian region and what is on top of that. To a certain extent, it's also what we did for Ashland. It's not very far. It's the same method that we use and which is working, and what we can add in Europe and U.S. And on top of that, which you cannot -- because a part of the -- 1/3 of the synergy, around EUR 10 million is not on PIAM top line but will concern Arkema legacy top line, we benefit from their incredible presence in Asia, in particular, in Korea to accelerate the growth of Arkema in Asia and in Korea in consumer electronics and also in batteries, okay? So this, you cannot apply to the top line of PIAM, you have to apply it to the top line of PVDF and polyimide 11 and 12.

The next question is from Jaideep Pandya with On Field Research.

The first question really is on the whole sales process. So if I'm not wrong, the Glenwood guys had put this up for sale in Q1 last year, roughly around the same price. And in press in Korea, it was said that several players, including your competitors, we're looking at this. So about 15 months down the line, you have paid roughly the same price for an asset where there has been significant destocking in the second half. So just wondering what has been really the negotiation process and how strategic has this been? And then a follow-up to that, Glenwood did enter this deal very long ago. So why is it that when they entered the deal, you didn't consider this asset, and you're considering it now? So what has changed really within Arkema for you to say that this is very strategic? That's my first question. And then the second question really is, could you just tell us -- we completely understand on the EV side your positioning. But on the electronics side, how is your positioning today in big OEMs on the smartphone side? And how can you leverage the PI polyimide films in the electronics market? And then finally -- sorry to ask so many questions, but finally, on the polyimide 11 and 10 and 12 portfolio, what is the link between that family of polyimides versus what PI brings? Those would be my 3 questions.

Okay, Jaideep. Thank you for your question. In fact, your first question is a strong point for us. The only issue is that your assumption is quite wrong about last year process. It was -- I don't want to comment, but if you dig a little bit, you will find all details in the press, okay? The price, for reasons that we don't control, there was a transaction which has not gone through at the last minute, okay, but it was a done deal. And it was at a far higher price. So in fact, they just confirmed that for us, it's a far better timing. But -- so your assumption are not the right one, Jaideep, but you will find everything on the current press, and ourself, we have all the details, but we don't want to speak for stakeholders. With regard to why consider asset now versus 3 years, this is basically what we explained. It's really on the trough, destocking, right timing, lower price, potential of growth at the same time because EV is still accelerating very significantly. So the market has not stopped at all. On the contrary, we have projects which are going everywhere. And a big part, which answers to a certain extent also the question of Alex, the EV -- the potential of the EV market is untouched. So a big -- the majority part of the growth would come from EV. Now with regard to electronic positioning and the -- how we can leverage with our position in polyimide 11 or 12, for example, this increase of range with polyimide, maybe I will ask [indiscernible] to answer to you.

So for Arkema, electronics is already today an important market. We do sell polyimide 11 specialty compounds into things like smartphones, smartwatches, flexible screens. And so what's key for us in this deal is the access to even more OEMs, particularly in Korea. So today, Arkema already has good relationships in China and the U.S. amongst others, but Korea is an area we can reinforce. And so we believe it will allow us to expand existing applications also in that strategic market for electronics and also for other BUs, as Thierry mentioned, so Sartomer has an attractive business in FPCB as well, which is similar to PIAM. And Bostik is also building strong platform on electronics assembly. So these 3 elements combined basically will allow us to grow through PI's customer links and accelerate our growth on our side as well.

And on the -- so polyimide evens [indiscernible], so basically, you answered, do you want to add maybe...

Yes. I mean, our materials are really used side by side. So we see, for example in flexible screens, the industry is moving towards multilayer structures where you will find both our polyamides as well as polyimides. It's really the combination of flexibility, very thin electronics that is needed. And for that, there's clear synergy in terms of multilayer structures between polyamides and polyimides.

Thank you. I will have also to take advantage of your question, Jaideep, if I may. And the previous question on the content of this acquisition, because you see acquisition on the chemical industry often. And our feeling at Arkema and it's -- I would say, it's an acquisition of medium size, is a that technology we make and it was my conclusion and of my introductory speech, technology will make already a huge difference in the coming years. This means that it's not like 10 years ago. As you know, we made a very accretive acquisition, and we are very proud about it. But the profile -- you have seen that the profile of the acquisition we are making is a bit different today, more technology-oriented, more focused, and they are all megatrends-oriented. And from this standpoint, PIAM is really fitting this element. The megatrend are there. You like it or you don't like it. So you can buy at a lower price, an acquisition which I would say, which technology, which was good, legacy technology, mature markets, et cetera, growing at GDP plus. Okay. But if you just do that, your portfolio at a certain point will be too weak compared to the acceleration of the world. And we try with Arkema to do different things at the same time. First to be very strong on our legacy, and we have proven that we are very strong there, but in a very focused way. And maybe I would say for a certain number of years, PIAM in the last significant element of new technology we are adding and because we are very proud of what we have now and very satisfied, so we don't need to add more. But this one was really missing based on the view we have of the world going forward. And I can tell you that batteries and consumer electronics with EV will make a huge difference. So we want it to be positioned there. And this is really from the standpoint of a real opportunity.

The next question is from Geoff Haire with UBS.

This is Geoff Haire from UBS. Just had a quick question, most of mine have been answered. I was intrigued just to understand how the management structure of the business is going to work? Obviously, it's a listed company. So is Arkema going to manage it solely? And how is that relationship going to work?

Okay. It's a good question. In fact, the -- clearly, we will manage it as 54% ownership. So I think it's still a listed company. And they will have -- from this standpoint, they will have their autonomy on plenty of area, but we'll be the majority shareholder. So the beauty of this thing is that the synergy will come from top line and synergy with a complementary geographical standpoint. So for that, you don't need -- like we have done, for example, with a full integration, et cetera, not at all. But we -- and -- we are very positively impressed by the quality of the relationship we have been able to establish so far with the team, which is really top class management, and we'll be able to put in place the right interfaces, which will allow us on the market that we have defined to get really the full benefit of the top line synergy, either pf geographies or by technology or by end market. And this is -- the beauty of this deal is that we are completely complementary, different technologies. So it's not like if you are of the same technology, you need to streamline the manufacturing or whatever or streamline G&A, here it's different. It's an acquisition which is made for the technologies, for the benefiting from the customer intimacy, complementary geographical positioning. So this is how we are going to do it. So we reorganized the interfaces and collaboration in a way which is freed, simple, but it's not -- if it was your question, for example, integration, like [indiscernible].

But will Arkema will have the majority of the seats on the Board?

Yes.

Yes. Exactly.

You will?

Yes, sure.

Yes. Right, okay.

Otherwise, we would not sit here and take your question. No, no, it's obvious for us.

The next question is from Georgina Fraser with Goldman Sachs.

Just one question. So today, you've made this acquisition announcement. And you've also, during the call, reaffirmed your full year 2023 guide. And this comes at a time when a lot of your peers in the chemical sector are making quite significant profit warnings and announcing restructuring programs. I was just wondering if you could talk through why you think Arkema is able to kind of weather this difficult macro environment a lot better compared to peers? I would love to hear your opinion on that.

It's always difficult to talk about this. As you know, we are not the one who make comments about and we don't have the same portfolio. I will take your question as a positive point because sometimes we are considered to be more cyclical than others. And finally, you see that maybe the truth is different because the portfolio has really made very significant progress. See what I can say. We rely on the portfolio. We are -- it's true that the macro is challenging. But you know, the way the company is managed, and you have a part of the team with me today, [indiscernible] as a company, you need to be agile. And I think we also understand well our strengths and weaknesses. And I think we try to guide as much as we can with the highest transparency. This is what I can do. It's difficult to talk about others. What I can say is that for you this is important news, is that we confirm what we said so far, either at the beginning of the year or we said during the call of the first quarter release, I think we stay completely consistent even if the macro is rather weak, as we say, but we manage it and I would say we are pleased to get this confirmation. I think for us, it was important to share this information with you because you could have -- I agree, there has been some -- not for all of them, but for some of them, there has been some negative results, so we wanted to reaffirm what we said so far.

Yes, absolutely. I appreciate that. And maybe if I can sneak in one more question. You explained a lot about the strong market growth potential of the polyamide business. Could you talk about whether you've got plans to kind of further expand the end markets that you're addressing? And maybe give us some of the breakdown by end market of that 9% market growth you were talking about?

You're talking about PIAM or you're talking about Arkema?

PIAM.

Okay. Who want to take that? [indiscernible], do you want to take it? Yes?

Sure. I would say, beyond the EV and beyond electronics, we target also semiconductors market, for instance. And some other industrial markets, especially in U.S.A. and Europe, where PIAM is not very present at all. So these are the key targets we have beyond the EV and electronics. So this will be semiconductors and other industrial market, which could be other transportation and it could be wells and [indiscernible].

So what is good is that it's [indiscernible] technology that even there are some star markets and for us, EV is a key one, as you know, I think there is a battle to be rightly positioned in this market and probably [indiscernible] will help us. But even beyond that, we see because of our knowledge of other industrial markets from polyimide and PVDF, as [indiscernible] mentioned, because of that, we'll be able to address as of niche, not the same quantity, but they will contribute to the growth, which seems to be very promising. This is why you have the pyramid of polymer. It's a very important -- on Page -- where is that, 3? On Page 4, thank you, Beatrice, okay? So it was part of my introduction. We were missing -- we had a very good 5-performance polymer range, but we were missing this quality of polymer, this -- and now it's complete.

And do you see this acquisition as securing your 2024 sales and margin targets? Or could there be upside to that if the cycle recovers by then?

So far with -- frankly-speaking, because we make the calculation of the time together with Marie-Jose, you know that in '20 when we published our Capital Market Day, we have the sort of envelope of M&A, which include disposal and acquisition. Overall, with PIAM, we are in the envelope. So for us, it's part of the '24 target. So in the current environment, we confirm the '24 target. As you know, if we do more, we do more. But let's be really satisfied with the fact that we are very consistent with what we say in '20. But what is reassuring for you is that it's part of the envelope that we designed and Marie-Jose will take advantage of the next Capital Markets Day to confirm the cash allocation where we are compared to what we see.

It's definitely certainly accretive beyond '24, I would say. For '24, I expect more of mutual impact.

The next question is from Laurent Favre from BNP.

Two questions, please. The first one, referring to Slide 7. Is there anything you can share with us in terms of either utilization rates for '21 and '22 on price versus volumes when you look at those last few years of performance? And I guess what I'm trying to understand is whether the 33% margin in '21 was full utilization rates, business sold out, and so that's a peak margin scenario? Or is there upside to that into the recovery for the next few years? That's question 1. And then question 2, which is, I guess, slightly unrelated. A few years ago, you talked a lot about PEKK as a polymer of interest with high growth potential. I was wondering if you could give us a little bit of an update there?

Yes, these are 2 good -- Laurent, 2 good questions. So on the first one, in fact, the topic of the profitability -- vision of profitability of PIAM in this destocking more challenging condition, is really a topic of volume, not of margin at all. So it's not a matter of utilization rates. It's truly a specialty product, it's really a matter of -- and certainly not a topic of pricing, it's really a matter of volume with a major impact of the current macro and the destocking. So we are confident on that. And on the PEKK potential. So it's still -- for us, it's a niche. So we made a moderate investment in the U.S. for PEKK. The beauty, but also the difficulty of PEKK is that the markets are completely different. They are -- one of the advantages of PIAM is our short cycle market, the development are quite quick. So the NBD portfolio [indiscernible] is really developing very fast. PEKK, we are talking, for example, on aeronautic or 3D for a very specific application, we are talking in years. When I say years, it's 5 years, 6 years, 7 years. So the growth will take time. So for us, PEKK is like a seed that we planted a few years ago, and that will take, for me, and we start to see really good development with aeronautics, which became lighter in terms of development because of COVID, for me, it's more 2030 real emergence. For the time being, we are really in the [indiscernible] phase. It takes time. So completely different from the PIAM portfolio. And also in terms of end markets, the beauty of PIAM is that it's mostly focused on high-growth businesses. PEKK is more spread. So you have the end market, they grow above GDP, but not significantly above GDP. So they are different in nature.

The next question is from Martin Roediger with Kepler.

I have 3 questions. Regarding your -- you mentioned the EV, but I would like to understand, what is the cash payment for the 54% stake you are acquiring? Secondly, what is the premium per share versus the share price of the stock market yesterday you are paying? And then finally, what is the net debt level? And here, I refer to the 100% net debt level of the company, PIAM.

So I will take, shortly, the first 2 and maybe Marie-Jose, you want to take the last one? So on the first one is the EV, because the cash payment and EV are nearly the same as...

Net debt is different...

Yes, the net debt is different, but the cash payment will be a little bit less than EV. So it's slightly less, but certainly not more, if it was your question. The premium versus the share price is around what, 60%. Now you don't have lot of liquidity, but it's 60%. And the net debt level...

So we are talking something in the range of EUR 40 million to EUR 50 million net debt level, in light in fact, of the recent CapEx expansion that PIAM has completed. So we are counting, let's say on a disbursement of around EUR 670 million, EUR 680 million by end of the year.

There are no more questions registered at this time. I turn the conference back to Mr. Henaff for the closing remarks.

Okay. So I wanted again, to thank you very much for your -- for attending this conference at short notice. I think, as you could see, we are at the same time, very excited about this transaction. But on the other way, we continue to work on the day-to-day, as you can see, with a lot of determination and if you have any further questions, don't hesitate and our team, as usual, will be there to give you complementary comments. So again, thank you for your time and looking forward to having another opportunity to discussing with you. Thank you.