Inbox: RCB kürzt Wolford-Kursziel

Outlook: On June 9 Wolford communicated that the main shareholder group (WMP Familien-Privatstiftung, Sesam Privatstiftung and its subsidiary the "M. Erthal & Co." Beteiligungsgesellschaft m.b.H.), as well as related parties announced the intention to sell their stake (ca 65%). The shareholders have hired a financial advisor and started a process for the selection of interested parties. The purchase of the majority stake by a future core shareholder shall be combined with an equity financing transaction the size of which has not yet been determined. On July 11, Wolford announced that it has achieved an extension of its credit lines until June 30, 2018 and secured a bridge financing of up to EUR 10 mn for seasonal liquidity requirements. Thus the company has managed to secure financing for the current financial year. We would expect the company and core shareholders to be focussed on achieving a sale within the next 6 months, otherwise we would expect another extension of financing to be required.
 
Valuation: We have lowered our forecasts for 17/18e-19/20e. We base the valuation on our DCF model and decrease our one-year target price to EUR 16.0 per share which results in a confirmed REDUCE recommendation. Our valuation is based on our fundamental assessment of the company which is on the brink of a major shareholder change which could present various scenarios for minority investors.