Bullboard - Stock Discussion Forum Mattr Corp T.MATR

Alternate Symbol(s): MTTRF

Mattr Corp., formerly Shawcor Ltd., is a global material technology company serving critical infrastructure markets, including electrification, transportation, communication, water management and energy. The Company operates through a network of fixed and mobile manufacturing and service facilities. The Company operates through two business segments: Composite Technologies and Connection... see more

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TSX:MATR - Post Discussion

Mattr Corp > Shawcor is worth >$25 in my opinion

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Post by EarningsPower on Nov 17, 2022 11:21am

Shawcor is worth >$25 in my opinion

I think people are really missing the upside here. The pipeline business is up for sale... if you go through the announced pipeline contracts only (many more are not announced) and use management's public comments about upwards of 20% EBITDA margins on the pipeline business you get to $140 million in segment EBITDA.

Again, according to management, in the worst of times, this segment is break even now. According to many offshore pipeline CEO's we are in the first inning of a multi-year bull market for offshore.

For a large offshore pipelines company, think of the margins you would save buy just owning Shawcors Pipeline business and vertically integrating.

What would a company pay for such a segment? 3x contracted EBITDA? 4x?? thats $400 to $600 million for the pipeline business alone, or $10 a share in cash. With Goldman Sachs running the process, I don't expect peanuts or a quickl sell out. They spent years right sizing this segment.

I wont sell below $20, and probably closer to $25 given the fair value of the I believe the remaining segments are worth.

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Comment by longrun86 on Nov 17, 2022 1:27pm

Thanks for you input. The big question is what will bidders pay based on EBITDA margin expectations. I had previously expected mid-teen margins. To the extent the market will pay up for the potential future, shareholders could be well rewarded. They will undoubtedly use a chunk of the sales proceeds for M&A. I won't be too upset if they pay a special dividend between $1 and $4 per share ...more

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Comment by EarningsPower on Nov 17, 2022 4:22pm

Good point! They could continue securing some big contracts in the Pipeline segment too as they work to get a sale done. A nice dividend would be appreciated for sure. Looking forward to the Q4 numbers next as they are supposed to be even stronger than Q3.

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