Danieli (MIL:DAN, Financial) ~4%, a case of corporate simplification..
The market did not have Danieli, on the "radar" because corporate governance "could be improved". That's why we had no further exposure to Danieli despite its extraordinary net cash position. Danieli has 2 types of shares (with and without voting rights) and is controlled by the Benedetti family, which until recently had its back turned to the market.
This situation is expected to change radically, as the Bene-detti family has just proposed shareholding simplification.
Even if the conversion rate is not as expected, we think the net effect of the transaction is positive. This makes Danieli another investment alternative for many more institutio-nal investors, which we think will end up being reflected in the share price.
Remember that Danieli has almost as much cash as it is worth on the stock exchange, and obviously you would have to add the value of its businesses to this cash, mainly that of manufacturing plants to produce steel. This busi-ness has a promising future because the steel manufactu-ring industry is one of the most polluting and Danieli has the technology to reduce its environmental impact.
From Francisco Garcis Parames' Cobas Funds third-quarter 2020 commentary.
