The top-performing stock for the quarter was Saft Groupe (XPAR:SAFT). Headquartered in France, Saft Groupe is a leading designer, developer and manufacturer of batteries for industrial use by companies in areas such as telecommunication, transport and defense. Shares of Saft Groupe rose in early May after news that it received a friendly tender offer from French energy operator Total. The offer price came in at an approximately 38% premium to its prior day’s closing price and remained at that level as we ended the second quarter. Total has indicated that the acquisition is part of its plan to accelerate development in the fields of renewable energy and electricity. We believe the offer should face few regulatory hurdles. However, in order to pass, the transaction needs more than 50% shareholder approval. We will evaluate how to proceed, but in the interim we have welcomed the closing of the gap between Saft’s share price and our estimate of its intrinsic value.
From David Herro (Trades, Portfolio)'s Oakmark International Small Cap Fund second quarter 2016 commentary.
