Date: 1 July 2026 (article release date may differ)
Ticker: PROF B (Nasdaq Stockholm)
Price: ~97.0 SEK
Market Cap: ~718 MSEK

Is a pure cyclical, macro play a special situation? Nah, I don’t think so.
But if you throw in a hidden cash flow and internal restructuring into a cyclical play, then that’s a special situation. Today, we’re going to talk about ProfilGruppen.

In the past year, ProfilGruppen’s share price has gone down over 45%, dropping from ~170 SEK to below 100 SEK today. The news will show you a company that just slashed its dividend to zero, gave up on their regional expansion, and reported an anemic FY 2025 operating cash flow of just 11 MSEK.

But if you look closer, there is something more than just macro trends or a cyclical recovery to play for. There are corporate maneuverings, as well as a hidden cash flow that still includes COVID in your investment thesis more than five years after the fact… which I think is kinda cool.

TL; DR

• ProfilGruppen manufactures customized aluminium extrusions and components.

• Catalysts:

  • Uncoiling of the hidden cash flow: Paying down COVID tax deferrals and a botched Polish expansion mask true cash generation.

  • Internal restructuring: A complete board re-shuffling, a returning turnaround CEO and a weaponized Alternative Performance Measures.

  • Macro tailwinds: Recovery of the end-markets, lightweighting and recycling megatrends, EU Carbon regulations (CBAM).

• Valuation:

  • Floor valuation against current Market Cap of 718 MSEK.

    • A conservative Normalized Owner’s Earnings of 80 MSEK. A 10x multiple implies ~800 MSEK in Equity Value.

    • A clean Balance Sheet with Net Tangible Assets of ~727 MSEK.

  • Potential upside within 24 months:

    • Without restructuring: 10% to a normalized Owner’s Earnings-based floor valuation.

    • Post-restructuring: 40%-125% potential upside, a minimum of 18% annualized IRR.

• Risks: turnaround friction/delays, APM accounting manipulation and delayed macro recovery. Further downturn from current level is definitely a possibility.

In this article, we will breakdown the special situation in ProfilGruppen. Let’s get to it!

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

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The Business

ProfilGruppen is a member of the old economy. They take raw aluminum billets as inputs and output customized extruded profiles, which they then deliver to the European automotive, construction and electronics sectors. It is a capital-intensive business where the barriers to entry are physical, heavy and expensive. AI can’t disrupt them.

Because of this capital intensity, when the company is run poorly, the massive depreciation and fixed costs act as an anchor weighing down the company’s profitability.

The Problem

To understand the opportunity, we must first understand why the market has punished this stock. The pessimism is driven by real, but (hopefully) temporary factors:

• The Polish Expansion: In 2025, former management attempted to expand operations by acquiring and running an extrusion facility in Poland. Management ultimately had to amputate the operation, taking a hit to the bottom line.

• C-Suite Musical Chairs: ProfilGruppen’s executive seat has been a revolving door. Over the last six months, they have gone from Mari Kadowaki to interim CEO Kerstin Konradsson, and finally to the newly appointed permanent CEO Per Thorsell (effective May 2026). Add to that an interim CFO. The whole thing just doesn’t reflect stability.

• Macro Headwinds: Nordic and continental European industrials have been in a multi-year slump. High interest rates, geopolitical situations and high raw aluminium prices have been a headwind for ProfilGruppen’s key customer sectors.

• Declining Margins: Even before the macro slump, ProfilGruppen was suffering from internal bloat. Their Return on Equity (RoE) shows a clear, multi-year deterioration. This prolonged margin compression signals lack of pricing power and/or cost efficiency, leaving the company vulnerable when volumes dropped.

• Zero Dividend for 2026: The dividend cancellation was driven by the points mentioned above: costly dismantling of Polish operations, weak end-market demands and deliberate capital preservation for the restructuring plans.

Despite these problems, ProfilGruppen is intrinsically still a profitable cash engine if you look through the superficial numbers. On top of that, it is currently undergoing a deliberate reset.

The Triple-Threat

The thesis for ProfilGruppen relies on three independent catalysts converging over the next 18 to 24 months.

Catalyst 1: The Hidden Cash Flow

If you look at the cash flow statement from 2023, you will see a massive anomaly: ~429 MSEK in operating cash flow (after changes in Net Working Capital). Conversely, in 2024 and 2025, operating cash flow looks terribly depressed: 90M and 11M, respectively. What happened?

COVID happened. Well, COVID and the The Swedish Tax Agency actually. During the post-pandemic era and energy crisis, the government allowed companies to defer various tax payments. ProfilGruppen leaned into this, accumulating roughly 246 MSEK in deferred tax debt by 2023, which artificially inflated 2023’s cash flow.

Now, the pendulum is swinging back. ProfilGruppen is currently using its operational cash to pay down this tax debt (83.2 and 107.0 MSEK in cash outflows in 2024 and 2025, respectively), with the remaining ~78 MSEK scheduled to be cleared by the end of 2027. Once the COVID debt is fully amortized, the underlying cash generation will cleanly flow to shareholders again, allowing for dividend reinstatement and other forms of shareholder return.

Furthermore, the aforementioned Polish expansion also distorted the 2025 financials. Leasing and operating this facility was a cash drain, resulting in a cash burn of -72.0 MSEK.

These are the hidden cash flow. Right now, the company’s true free cash flow is being masked by mandatory government repayments and one-off botched expansion.

Valuation (Pre-Turnaround)

Let’s first value ProfilGruppen before restructuring using three methods: Normalized Owner’s Earnings, Balance Sheet (Liquidation Value) and Relative Valuation Multiples.

Normalized Owner’s Earnings

ProfilGruppen is a cyclical company. Thus, it is necessary to look at their numbers through a full cycle (2018 to Q1 2026), and removing the effects of COVID payment and Polish expansion.

• Base Cash Flow: We take their 8-year average Cash Flow from Operations (CFO) before changes in Net Working Capital (NWC), after adjustments. Over many years, NWC changes should even out.

• Adjustments:

  • We subtract 20 MSEK in 2023 subsidies.

  • We add back a conservative 50% of the Polish establishment effect in 2025.

  • COVID effects are accounted for as changes in NWC.

  • Interest expenses are accounted for in the base CFO before NWC.

  • We do not take into account the Q1 2026’s CFO, since the annual run-rate may get distorted and inflated. The discrepancy is potentially due to the Polish establishment cost initiated in early 2025.

• Result: Average base cash flow = ~175 MSEK.

• CapEx: The Q1 2026 run-rate seems to be 48 MSEK, while FY 2025 CapEx was ~83 MSEK. I can’t say for sure, but my guess is that this discrepancy may be due to the APM measures (discussed in the next section: Catalyst 2), which forces a tighter leash and disincentivizes management from initiating low-return CapEx.
  In any case, we take the higher CapEx of 83 MSEK to be on the conservative side.

• Leases: We take IFRS 16 lease repayments as ~12 MSEK, in line with FY 2025 and Q1 2026 run-rate.

Normalized, conservative Owner’s Earnings: 175 - 83 - 12 = ~80 MSEK

Assuming a 10x multiple (10% required rate of return, no growth), this yields an implied Equity Value of 800 MSEK, which is ~11% above their current market cap of 718 MSEK.

In most cases, this is not a sufficient Margin of Safety in my books. I would require more of a 30% discount from normalized Owner’s Earnings for a cyclical company - which implies a 560 MSEK of Equity Value, a further ~20% downside from the current Market Cap. However, there are other catalysts in play.

Let’s continue with our valuation for now.

Balance Sheet (Q1 2026)

Their Net Tangible Asset (NTA) value is:

Equity (737.3) - Intangible assets (10.0) = 727.3 MSEK

They are practically trading at their NTA value. Nothing to write home about, but it is good to know they won’t go bankrupt anytime soon. Their intangible assets have always been negligible, keeping NTA close to Book Value. The balance sheet is healthy, with Net Debt / EBITDA at 0.7x excluding COVID deferred tax (0.9x including it).

Valuation Multiples Against Peers

Here are their publicly listed Nordic peers:

• Norsk Hydro: A massive, fully integrated ~175 BNOK giant, covering the whole chain from mining to extrusion. Hydro wins on sheer volume and vertical integration, while ProfilGruppen competes by being the agile, customizable alternative. ProfilGruppen offers contract manufacturing with high personal involvement, bespoke profile and lower-volume orders that are too small and complicated for Hydro.

  • P/B: 1.3x-1.7x

  • EV/Sales: 0.8x-1.1x

  • EV/EBITDA: 7x-9x

• Gränges: A larger but arguably the closest peer, while not competing directly in extrusions. They dominate rolled aluminium (heat exchangers, battery foils).

  • P/B: 1.4x-1.7x

  • EV/Sales: 0.7x-1.0x

  • EV/EBITDA: 7x-9x

• Ages Industri: Smaller but also a very close domestic peer, focusing on multi-metal contract manufacturing (die casting, machining, welding). This comparison is noteworthy because ProfilGruppen’s new board member, Anders Berggren, is currently the Chairman of Ages Industri.

  • P/B: 1.0x-1.3x

  • EV/Sales: 0.5x - 0.7x

  • EV/EBITDA: 6x - 8x

• BE Group: They are primarily a wholesaler with some value-added services and simple processing. Owned by the same group of investors, Stillström family / Traction AB.

  • P/B: 0.5x-0.7x

  • EV/Sales: 0.3x-0.6x

  • EV/EBITDA: 4x-6x

  • Distressed valuations due to high leverage and negative profitability in the past years. It might also be an interesting turnaround case, although the downside is not as protected and the business model is not as value-added to their customers.

ProfileGruppen has a current P/B of ~1.0x, EV/Sales of ~0.4x and EV/EBITDA of ~4.2x. ProfilGruppen trades more like their distribution, wholesaler peers than their complex manufacturing peers.

Why the Discount? ProfilGruppen trades at a discount to Hydro because it lacks scale, and it lacks RoE stability when compared to Gränges. While Gränges boasts a robust ~10% RoE through the years, ProfilGruppen’s RoE (IFRS metrics) has been in consistent decline over the past 5 years - though still visually higher than Gränges. This will become relevant when we discuss the second catalyst.

• 2021: 1.61x P/B | RoE 27%

• 2022: 1.40x P/B | RoE 17%

• 2023: 1.32x P/B | RoE 16%

• 2024: 1.12x P/B | RoE 15%

• 2025: 1.23x P/B | RoE 16%

• Q1 2026: 0.98x P/B | RoE 12%

Catalyst 2: Internal Restructuring & The Alternative Performance Measures

ProfilGruppen does not have a large free float (less than 2M out of 7.4M shares). It is heavily controlled by anchor shareholder Bengt Stillström (29.34%). Stillström family’s investment vehicle, AB Traction (Bengt is the founder and former CEO), is a legendary player in the Swedish micro-cap industrial space known for long-term holding.

At the end of 2025, Stillström and the other owners ran out of patience. They wrote off the Polish operations, instituted Alternative Performance Measures (APMs), re-shuffled the board and fired management.

Alternative Performance Measures (APMs)

Here comes the most interesting part of the investment thesis:

APMs are usually introduced to visually inflate the stock - showing the public that the company is more profitable than the IFRS or standard accounting shows. Interestingly, ProfilGruppen’s new APMs do the exact opposite.

Standard IFRS accounting values ProfilGruppen’s heavily depreciated machinery and fixed assets at roughly ~600 MSEK. The APM puts the replacement cost of the fixed assets at 2.7 Billion SEK. The board forced this massive replacement value onto the APM balance sheet. By inflating the asset base, they artificially ballooned their depreciation charges: 186 MSEK in 2025 according to the APM vs 89 MSEK according to IFRS. This crushes FY 2025 and Q1 2026 APM net income from continuing operations to a mere 35.3 MSEK and 18.2 MSEK, corresponding to an APM RoE of ~2.4% and ~4%.

The APM metric is a weapon.

They have publicly established a new financial target: a 15% ROE on this inflated asset base, which requires generating 214 MSEK in net profit (an implied ~9% net margin) based on 2025 revenue.

By putting the company in a bad light, the owner and the Board justified the C-suite revolving door and gave the new management team a threatening nudge: We have a multi-billion SEK asset base. Be more effective. Optimize the factory floor and get us a 9% net margin.

The 2026 Board re-shuffling

At the 28 April 2026 Annual General Meeting, the largest owners (sitting on the Nomination Board) completely wiped the Board clean. Bengt Stillström stays as Chairman of the Board, but they replaced the rest of the Board with heavy industrial operators and metal-industry financial veterans.

• Karl Söderberg: Former CFO of Boliden Smelters and Nyrstar (a global base metals business).

• Per-Ola Holmström: Currently the Deputy CEO and Head of Finance at Nolato AB (a publicly traded Swedish polymer and manufacturing company).

• Anders Berggren: Former Deputy CEO of Marmon Holdings (a Berkshire Hathaway company) and former CEO of Husqvarna Construction Products. He is also currently the Chairman of Ages Industri AB.

The return of the previous CEO, Per Thorsell

Cycling through three CEOs in six months optically looks like chaos. But digging into the newly appointed permanent CEO, Per Thorsell (effective May 2026), reveals a clear turnaround plan. Thorsell is not a newcomer learning the ropes. He actually served as ProfilGruppen’s CEO from 2014 to 2019.

During his previous tenure, Thorsell successfully executed a turnaround. By 2017, under his watch, the company reported the “best quarterly results in the history of the company.” He left to run Bergkvara Group but has now been brought back by the Board for a specific mission: 15% RoE on APM basis. The “learning curve risk” usually associated with a new CEO is relatively low. Thorsell is a proven operator stepping back into a machine he already fixed once.

So what is the turnaround plan?

Looking at the statements in their recent reports, as well as Thorsell’s previous turnaround playbook, one can see the most probable path forward.

• The Four Profit Centers

  A critical mechanism for this turnaround was introduced in late 2024 when the Board, stating “…requires both continued streamlining of processes and price- and margin-improving measures as well as expanded business,“ refocused the company into four distinct profit centers:

  • Extrusions: The baseline operation, manufacturing of customized aluminium profiles, including anodizing, machining and ancillary services.

  • Components: The first step up the value chain, focusing on assembly, logistics and warehouse management.

  • Contract Manufacturing: The potential margin driver. Here, ProfilGruppen acts as a bespoke engineering partner, delivering production solution and capacity to customers.

  • Risk Management: A dedicated unit focused on managing the day-to-day activities, financial policy and risks against raw material prices.

• Several signals are explicitly stated in Q1 2026 report:

  • “Due to insufficient governance during the previous year, the intended changes relating to ways of working and financial management were not implemented. During the first quarter, key positions were filled.“ This includes hiring a new head of Extrusions (Hendrik Hasewinkel), the boomerang CEO (Per Thorsell) and the complete reshuffling of the Board.

  • “Several projects were initiated during the quarter, all aimed at achieving cost savings in production and delivery,“ clearly hinting at an effort to improve operational and factory efficiency.

  • “…achieved through the development of the customer offering in several respects,“ which hints at putting more focus on the components and contract manufacturing profit centers.

  • “…existing business relationships must be reviewed and challenged. This may result in short-term negative effects on earnings but is intended to contribute to a stronger platform and improved profitability over time.” This also hints at exiting lower-margin contracts and replacing them with ones with higher margin.

• Per Thorsell’s previous reign was centered around structural turnaround (2014-2015), capacity scaling (2017-2017), and consecutive record-breaking financial performances (2018-2019). It took him roughly 2 years to improve ProfilGruppen’s near-0% operating margins to 6%-7%. His playbook sounds quite similar to what the Board has communicated in the Q1 2026 report.

  • Expanding Value-Added Services: Moving beyond raw aluminum extrusion by securing integrated contracts for fully processed, pre-packaged customer solutions.

  • Modernizing System Infrastructure: Updating the Enterprise Resource Planning (ERP) systems to gain visibility into operational metrics, margins, and costs. Optimizing procurement and supply networks to dynamically bypass commodity volatility and external geopolitical shocks.

  • Investing in Capacity Scaling and Automation: A bold capital investment for the highly automated extrusion plant to eliminate production bottlenecks and expand annual capacity.

Taking all these into account, we can assume that the turnaround playbook boils down to these specific strategies:

• Active Portfolio Management: An ongoing effort to increase the efficiency in lower-margin Extrusions work, while scaling up the Components and Contract Manufacturing offerings.

• Selective Contracts: The strategy implies moving away from low-margin customer contracts toward those who value - and are willing to pay for - ProfilGruppen’s value-added services.

• Operational improvement: Improving efficiency per production order - though this is nothing new, every manufacturer strives to be more efficient. But the enforcement under the returning CEO with relevant turnaround experience and bold investment decisions may prove to be more effective.

Valuations Revisited

If we assume the restructuring takes hold to a certain extent, how does the valuation change?

Balance Sheet / Liquidation Value: Thanks to the APM reporting, we get a better approximation of the true replacement cost of their asset base. In Q1 2026, their APM Balance Sheet implies a Book Value of ~1.5 Billion SEK (similar to their NTA value due to negligible intangible assets). Even if we apply a massive 30% haircut to the APM Book Value and assume a 1x P/B ratio (the lowest end of their historical numbers), the implied asset value is roughly 1.05 Billion SEK. At a current market cap of ~718 MSEK, we are buying a functional, cash-generating industrial complex for roughly 68 cents on the dollar relative to its replacement value. This provides a downside protection.

Owner’s Earnings: If the APM target is achieved, they will generate 214 MSEK in net profit from 2.33 BSEK of revenue, implying a net profit margin of ~9%. Because the APM framework already heavily bakes in inflated, real-world asset replacement costs, this targeted 9% margin acts as a sufficiently accurate proxy for the company's true Owner’s Earnings upon a successful turnaround. However, due to more selective customers and contracts, their revenue may decline in the near to mid term. Let’s assume a ~20% decline of revenue, putting their expected post-restructuring revenue to ~1.8 BSEK. This leads to a net profit of 162 MSEK with 9% margin.

Expected IRR (24-month horizon)

• The Bear Case: The downside is protected by the liquidation value of their assets even if the turnaround fails to materialize. Assuming the company still manages the macro slump well to revert to its historical mean, they would achieve the normalized Owner’s Earnings of 80 MSEK. Applying a 10x multiple yields an 800 MSEK Equity Value and a roughly 11% upside, annualized to 5.4% IRR return per year.

• The Base Case: Per Thorsell successfully trims the fat but struggles to hit the 9% margin target. They achieve 5%-6% margin instead, generating ~100 MSEK in net profit based on our 1.8 BSEK revenue assumption. Applying a 10x multiple yields a valuation of ~1.0 Billion SEK - a potential 40% return from current levels. This translates to ~18% annualized IRR.

• The Bull Case: If Per Thorsell successfully executes the APM mandate and hit the APM target of 9% net profit margin, this results in 162 MSEK of net profit. Applying a 10x multiple yields a valuation of 1.62 Billion SEK - a potential of ~125% return from current levels - ~50% annualized IRR.

Catalyst 3: The Macro Tailwind

I am definitely NOT a macro, top-down investor… So I’m a bit embarrassed to add this macro-based catalyst into my investment thesis. But the fact of the matter is that even the best management team, Board and activist owners cannot fight the economic cycle. Fortunately, the macro winds are now shifting in ProfilGruppen’s favor.

(And let's be honest, a "triple-threat catalyst" sounds wayyy catchier than a double-threat).

Despite its significant effects to ProfilGruppen’s performance, we will not do any revaluation based on these macro factors. I would think of it more as another downside protection and an extra kicker to the upside.

When relevant, I will put some links to posts from other Substack writers who are definitely more knowledgeable than me in the aluminium macro story.

The “Pass-Through” Model

ProfilGruppen does not generally lose profit margins when aluminum prices rise. They operate on a pass-through model where raw material costs are systematically passed on to customers. However, high prices do impact their Working Capital. When aluminium price spikes, ProfilGruppen must tie up massive amounts of cash just to hold physical inventory in their warehouses. On the other hand, lower aluminium prices free up cash from Net Working Capital.

The recent US-Iran peace deal (or no deal, I don’t even know anymore) in June 2026 has dropped aluminium prices back down to the 3,000 USD/t range. Furthermore, the cascading effect of the energy crash is paving the way to waking up the dormant European construction and industrial sectors. ProfilGruppen is perfectly positioned as their end markets are unfreezing.

Aluminum Megatrends

• “From Steel to Aluminum” (Lightweighting): Heavy industries (automotive, rail, construction) are swapping steel for aluminum to reduce weight and save energy. ProfilGruppen has built a specific business unit around this, explicitly marketing a “From steel to aluminum” customer solution on their webpage (link). Construction materials that need to be moved and handled physically become much lighter, thus requiring less energy. For the electric vehicle industry, the transition to aluminum has been and continues to be a prerequisite.

• The Circular Economy & The Green Premium: Aluminum can be recycled infinitely, requiring 95% less energy than primary smelting. ProfilGruppen heavily markets this circularity, noting that the metal is “the green metal,” and pointing out that over 90% of aluminum in transportation and construction is successfully recycled (link). Their peer Norsk Hydro’s 2025 Annual Report also cites megatrends such as the green transition driving their core assumptions.
  (If you want to understand the economics of recycled metal premiums, Brawl Street Journal covers it in his post The Cost of Purity).

• ASI Certification: To capture the Green Premium, ProfilGruppen holds the Aluminium Stewardship Initiative (ASI) Performance Standard, which verifies responsible production and sourcing (link).

CBAM and EU Regulations

The European Union’s Carbon Border Adjustment Mechanism (CBAM) is arguably the most significant regulatory moat-builder for ProfilGruppen now. ProfilGruppen competes with non-EU extruders (from China or Middle East) who rely on cheaper, coal-fired aluminum. By taxing these “dirty” imports, CBAM effectively destroys the cost advantage of non-EU competitors. Because ProfilGruppen operates within the EU and sources low-carbon European metal, CBAM shields them from cheap foreign imports, allowing them to capture market share and protect their processing margins.
(Klement on Investing breaks down the financial implications in The Cost of CBAM)

Management is highly aware of this. Their access to Nordic hydro and wind power puts them in a good position, with a big part of their energy consumption (85%) runs on renewable sources.

The Risks

No special situation is without hair. Here are the primary risks to monitor:

• APM Accounting Manipulation: When a measure becomes a target, it ceases to be a good measure. Because the APM is an internally derived, non-IFRS metric, management could technically achieve the 15% ROE target through accounting engineering rather than operational excellence. By tweaking the assumed “useful life” of the extrusion presses or adjusting “metal risk” allocations, they could artificially hit the 9% net profir margin target. To make sure that we do not fall for this trap, we must track the cash flows to verify the turnaround is real. Bengt Stillström - the largest owner and Chairman of the Board, is also our reliable friend here.

• Turnaround Friction: The company is currently in the early turnaround phase. Firing low-margin clients, restructuring the organization into new profit areas and changing workflows will cause near-term friction. Turnaround takes time. The share price may decline further if the top line declines considerably while the margins are not improving. If the turnaround takes four years instead of 24 months, our annualized IRR drops significantly.
  Investors must have the stomach for a messy period before the operational optimizations hit the bottom line. But when it hits, it’ll most probably converge with the COVID cash flow uncoiling and the cyclical recovery.

• Delayed Macro Recovery: If European construction and industrial recovery is delayed, ProfilGruppen’s volume recovery could be pushed out a few years, compressing our annualized IRR.

  • Supply & Demand Imbalance: Global demand for aluminium is rising, but global supply is constrained (most notably by China’s strict 45 million-tonne capacity cap, implemented to meet their own carbon reduction goals, link). This may lead to increase in aluminium prices, which would squeeze ProfilGruppen’s working capital (not so bad) and absolute order volume from key customers (very bad).
    (For a deeper dive into the mechanics of this structural deficit, I recommend reading Crack the Market’s piece on The Heavy Metal Meltdown).

  • On the other side, this structural deficit may help ProfilGruppen since it is forcing European manufacturers to secure local, reliable supply chains, creating a strong volume tailwind for established regional extruders like ProfilGruppen.

  • There’s also the looming risk of global trade flow shifts; for example, if US tariff policies alter the destination of North American or Middle Eastern aluminum, excess capacity (like diverted Canadian aluminum) could flood the European market, suppressing local extrusion premiums.

• NOTE: Please take into account that the shares may decline further before the macro and restructuring is completed, especially in a modern stock market that ruthlessly punishes bad news. I have not invested my planned full allocation and will average down if the share price drops further, given that the thesis is not broken. Allocate your investment appropriately.

The Verdict

ProfilGruppen is a cyclical industrial play, supercharged with hidden cash flow and internal restructuring. The new APMs keep the management in check, while the new APM RoE target offers a potentially pleasant upside. The cycle-normalized Owner’s Earnings of ~80 MSEK and an NTA value close to the current market cap ensure the downside is protected.

Patience may be required, both from the turnaround and macro front. But for investors willing to wait and rely on Bengt Stillström and the old-but-new CEO’s playbook, ProfilGruppen offers a compelling cyclical play in the Nordic small-cap market.

Alternative Performance Measures that make their own financials look terrible...
It’s like BDSM but in the investing world. I’m all for it!

Date: 21 May 2026 (article release date may differ)
Ticker: ZD (Nasdaq)
Price: 40.91 USD
Market Cap: ~1.51B USD

Here’s another non-Nordic investment thesis that we stumbled across while doing some detective work on a Nordic company. This time we are traveling out of the cold North to the land of the free, following the trail of a murder case:

• The Victim: Web forums and SEO businesses.

• The Suspect: AI-supported search.

• The Detectives on the case: A European activist fund called Pale Fire Capital (and yours truly, of course).

TL; DR

• Ziff Davis is a digital media and internet company currently trading at distressed valuations due to fears that AI search will disrupt its affiliate ad revenue.

• “Stub“ Price Discovery: The pending 1.2B USD sale of their Connectivity division demonstrates that the remaining stub is trading at extremely distressed valuations.

• The Valuations:

  • Accounting for tax leakage on the 1.2B USD sale proceeds, ZD’s balance sheet sits at a ~600M net cash position. The stub is currently trading at just 2.4x EV/EBITDA and 6x FCF, estimated from their last 3 years of average cash flow.

  • Assuming a 10x FCF multiples, the implied Equity Value of the stub presents an upside of up to 60%, or a price of ~65 USD / share.

  • In a worst case scenario where we completely write off the two supposedly “disrupted“ segments, the downside is capped at just ~25%.

• The Catalysts:

  • Management’s push to actively unlock value.

  • Entry of European activist Pale Fire Capital.

  • An active lawsuit against OpenAI acting as a free kicker.

There’s definitely a real threat from AI search, but we believe that the valuations have plunged far below the reality of their actual cash flow. The distressed valuations provide a distinct margin of safety, while multiple catalysts are driving near-term value realization.

Here comes the breakdown of the special situation on Ziff Davis. Let’s get to it!

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

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Ziff Davis operates through the following segments: Technology & Shopping, Gaming & Entertainment, Health & Wellness, Connectivity, and Cybersecurity & Martech.

The market fears AI Search will destroy ZD’s SEO-driven affiliate advertisement revenue. This is especially true for the Technology & Shopping segment, which is experiencing single-digit to low-teens revenue declines. The Gaming & Entertainment segment is also affected to a certain extent. Their other segments are essentially flat. Moreover, many of their segments have non-SEO sources of income, which include B2B subscriptions, specialized lead-generation and direct-to-consumer software that AI search cannot replicate.

The distressed valuations became even more pronounced after management announced in March 2026 that it had entered into a definitive agreement to sell its Connectivity division to Accenture for 1.2B USD in cash (link).

Pro-Forma Valuation

On top of the multiple catalysts that we will go through in the next section, the valuation of the remaining businesses (RemainCo) is the most attractive part of the investment thesis.

• The Balance Sheet: After accounting for tax leakage, we believe it is safe to assume that they can retire their 872M USD gross debt stack (as of Q1 2026) with the 1.2B Connectivity sale proceeds if they wish to. This leaves them with roughly ~600M USD in net short-term cash on their balance sheet (Cash, Cash Equivalents, Equity Securities). At a 1.51B Market Cap, the implied Enterprise Value (EV) is 1.51B - 600M = 910M USD.

• EBITDA Multiple: Looking at 2023-2025, RemainCo generated about 380M USD in EBITDA on average. The market is valuing it at a very depressed multiple of ~2.4x EV/EBITDA.
  Re-rating to a conservative 4x–6x multiple yields an EV of 1.52B–2.28B USD. Adding back the 600M cash implies an Equity Value of 2.1B-2.8B USD (40% to 90% upside).

• Free Cash Flow Basis: After taking out the Connectivity segment, corporate overhead costs and stock-based compensation, my conservative estimate of RemainCo’s FCF is ~180M USD. Valuing this at 6x–10x FCF yields an EV of 1.0B–1.8B USD. Adding the 600M cash implies an Equity Value of 1.6B-2.4B USD (6% to 60% upside).

With the lower end of this multiple being very close to their current market cap, it implies that RemainCo’s downside is heavily protected by its cash flow. But does a low 6x multiple on FCF make sense? It could be, if you truly believe that AI Search will kill their business model in the next few years.

Do you think these numbers are too rosy? Well, let’s do a worst case scenario.
We will completely remove the Technology & Shopping and the Gaming & Entertainment segments that are supposed to be “disrupted“ by AI search. This will serve as our floor valuation.

• In terms of EBITDA: This removes an average of ~180M of EBITDA, dropping RemainCo’s EBITDA to 200M. A 4x multiple on 200M EBITDA plus 600M cash yields a floor valuation of 1.4B USD (~7% downside).

• In terms of FCF: We can cut the FCF in half to 90M USD. A multiple of 6x on 90M FCF plus 600M cash yields a downside of roughly 1.14B USD (~25% downside).

Do you think that this floor valuation makes logical sense? This floor valuation basically assumes that Ziff Davis gave away the two “disrupted” segments with a combined EBITDA of ~180M completely for free. I find it quite improbable that it will come down to that.

With a worst case downside of 25% against up to an FCF-based 60% upside, I would take this bet any day of the week.

The Catalysts

Catalyst 1: Management’s Push to Unlock Value

Since Q3 2025, management has been “evaluating value-creating opportunities,” with the first tangible step being the sale of the Connectivity segment. In the Q1 2026 earnings report, they reiterated: “We remain focused on unlocking value for our shareholders as we look to complete the divestiture of the Connectivity business as well as explore additional value-creating transactions.”

Additionally, Ziff Davis also continues to buy back shares. Since 1 April 2026, the company has repurchased about 560,000 additional shares. Since the start of its current buyback program, Ziff Davis has retired more than 15 million shares.

Catalyst 2: Activist Entry - Pale Fire Capital

European activist firm Pale Fire Capital recently took a 6.9% stake, making them a formidable voice in the room pushing for shareholder value.

• Historical Playbook: Pale Fire specializes in tech/internet turnarounds and capital allocation enforcement. Their activist push at Groupon is a recent example (link).

• Plan for Ziff Davis: Their 13D filing (link) explicitly states they will make proposals concerning “changes to the capitalization, Board (including composition of the Board), and operations of the Issuer.” They also state that ZD was “undervalued and represented an attractive investment opportunity,” which management has publicly agreed with, hence the buybacks and “value-creating” strategies mentioned earlier.

Catalyst 3: The OpenAI Litigation (The Free Upside)

Ziff Davis’s lawsuit against OpenAI over the scraping of its web properties (PCMag, IGN, etc) is an unpriced catalyst in our valuation.

• Current Progress: In late 2025, a U.S. District Judge refused to throw out ZD’s contributory copyright infringement claims, allowing them to pursue the case further (link). OpenAI will most probably avoid trial precedent by settling and signing a licensing deal.

• Potential Cash Flow from AI Licensing Deal: ZD’s footprint is more niche than previous litigation cases like News Corp (~50M USD/year each with Meta and OpenAI, link) or the NYT (Amazon pays 20M–25M USD/year, link). Conservatively, we’d put ZD’s data licensing rate at 10M-15M USD per year. This is pure speculation on my part, but let’s run the numbers anyway because it’s fun…

• Valuation Impact: Since licensing revenue is mostly pure margin, an extra 10M-15M expands RemainCo’s EV on an FCF basis by 100M–150M USD assuming a reasonable 10x multiple, acting as a free cushion to the downside and a free kicker to the upside.

The Risks

• Melting Ice Cube: The fear of AI Search is real. While we acknowledge the threat, we also believe that ZD has a long profitability runway to unlock value and realize shareholder returns. This is supported by our floor valuation, which proved that the downside is limited even when we strip out the two most problematic segments entirely.

• Opportunity Cost: What if the ice cube is melting faster than our IRR because management is slow in unlocking value? This is definitely a risk. But with all hands on deck - management, the Board and the new activist owner being highly motivated to unlock value, the value realization may happen in the near-to-mid term (12-24 months).

• Proxy Battle: Reading about Pale Fire Capital, they seem to be somewhat of an aggressive activist that is not afraid of a proxy battle. Although it is certainly a good thing to have someone fight for the value of our shares, if the proxy battle is prolonged and postpones value-unlocking actions, it might signal a quick exit on my part.

The Verdict

Ziff Davis offers a setup for a deep-value special situation, with its distressed valuations providing a margin of safety and multiple catalysts potentially accelerating value realization. The market's AI-driven pessimism has created a disconnect between the company's underlying cash generation and its share price. With the incoming 1.2B cash infusion, we are effectively buying a portfolio of profitable internet assets for an implied ~2.4x EBITDA and ~6x FCF. On the other hand, all stakeholders are fully aligned to unlock value for shareholders.

The key here is to know when to get out. This is NOT a buy & hold company.

Date: 14 May 2026 (article release date may differ)
Ticker: AKZA (Euronext Amsterdam)
Price: ~49.60 EURO
Market Cap: ~8.5B EURO

As the name of my publication and my About page imply, I tend to focus on Nordic companies. But special situations are special situations, and sometimes one has to ignore geographic borders.

While doing some detective work on a Nordic company, I stumbled across the recent activity of Europe’s largest activist fund - Sweden’s own Cevian Capital. Following their breadcrumbs led me out of the cold north and into the flat plains of the Netherlands. What I found among the “greens“ and the red light districts is a beautiful merger arbitrage set-up within the paint industries, with multiple catalysts and double dipping potential.

TL; DR

• Akzo Nobel NV is a global leader in the production and marketing of paints and performance coatings.

• Per the November 2025 merger prospectus (link) and subsequent SEC Form 425 filings (link), Akzo is executing an all-stock “merger of equals” with Axalta (NYSE: AXTA).

• Catalysts (if the merger goes through):

  • Special dividend: 2.5B EUR cash delivering a ~26% cash yield within 12 months at current share price.

  • US Relisting Revaluation: The merged entity plans to list solely on the NYSE, which may re-rate the stock from European to US multiples. A conservative valuation below US peers presents a ~50% upside on the post-special dividend stub. A less conservative valuation at the lower end range of US peers presents up to ~70% upside on the stub.

  • The 2 catalysts combined represents a conservative upside of ~36% in 24-36 months, annualized to 11-17% IRR. The less conservative valuation (but still conservative compared to US peers) offers an annualized IRR of 16-30%.

• Double-dipping: Delisting from Euronext Amsterdam may create index churn, temporarily depressing the stock before US index funds start buying in.

• Downside protection:

  • Guardian Angel: Europe’s largest activist fund Cevian Capital doubled its stake to 10.15% a month after the merger announcement late 2025 and took a board seat in Q1 2026.

  • Put Options: buying puts creates a hard floor on this trade, capping the absolute downside to ~16% in case of the merger falls through.

In this article, we will go through the whole arbitrage menu presented by this merger in more detail. Let’s get to it!

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

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The Special Dividend: 2.5 Billion Euro

To equalize valuations, Akzo will distribute a 2.5B EUR special dividend (~14.60 EUR/share) to current Akzo shareholders prior to the late 2026/early 2027 merger closing.

This 14.60 EUR includes the recent dividend already paid last week of 1.54 EUR/share. So for those getting in on the trade today, the potential special dividend is limited to 13.06 EUR.

• The Arbitrage: At the current entry price of 49.60 EUR, the remaining 13.06 EUR special dividend still represents a juicy ~26% cash yield in roughly 12 months.

• Funding of the special dividend: The cash is essentially already in the bank as part of a portfolio optimization strategy, institutional debt and operational cash flow.

  • Last year, Akzo divested its India subsidiary for 922M EUR cash proceeds and an EV of 1.4B EUR, which represents a staggering 22x EBITDA multiple.

  • They also sold their Pakistan subsidiary for 50M EUR. Although the proceeds are rather insignificant, it represents yet another staggering 14x EBITDA valuation multiple.

  • A potential exit from the South and Southeast Asia Decorative Coatings is also actively discussed (link). These remaining Decorative units are larger than the divested Indian unit in terms of revenue, thereby providing another potential cash windfall exceeding 1B EUR.

  • Earlier this year, they raised a 1.1B EUR dual-tranche bond: 600 million (5-year @ 4.0%) and €500 million (10-year @ 4.625%). Akzo locked in a long-term capital at an average rate of ~4.28%, which is a very low cost of capital in today’s high interest world.

  • Their cost-saving initiatives are supposed to save over 250M EUR annually.

Pro-Forma Valuation (Cost Synergies & US Relisting Arbitrage)

The new merged entity (let’s call it Akzo-Axalta) will be a ~17B USD revenue company listed solely on the NYSE. Going beyond the special dividend, the merger prospectus outlines a combined paint & coatings powerhouse with targeted cost synergies of 600M USD, “primarily coming in the first 2 years.” We’ll only add 50% of these synergies to our pro-forma valuation to be conservative.

The pro-forma valuation is kind of complex, but let’s see if I can guide you through it (and do inform me if my calculation is wrong!).

We will use an exchange rate of 1.1 USD to 1.0 EUR in the following calculation. The numbers are taken from the respective companies’ Q1 2026 reports.

• Pro-forma EBITDA

  • AkzoNobel (2026 Guidance, link): ~1.5B EUR.

  • Axalta (2026 Guidance, link): ~1,150M USD → ~1B EUR.

  • Synergy Capture (Conservative 50%): +270M EUR (of the total 600M USD → 540M EUR target).

  • Total Pro-forma EBITDA: ~2.75B EUR.

• Pro-forma Enterprise Value

  • Let’s first calculate the pro-forma share counts

    • Akzo Current: 171.3M shares.

    • New Shares Issued to Axalta: Axalta has ~215M shares. At a 0.6539 exchange ratio based on the prospectus: 215M * 0.6539 = 140.6M shares.

    • Total Combined: ~312M shares.

  • Now let’s calculate Equity Value based on Akzo’s current share price.

    • As an Akzo shareholder, you receive 13.06 EUR in cash to equalize Akzo’s valuation to Axalta’s. At the current share price of 49.60 EUR, the market is effectively valuing the remaining piece of Akzo-Axalta at 36.54 EUR per share.

    • Equity Value of Akzo-Axalta: 312M * 36.54 EUR = ~11.4B EUR.

  • And now their Net Debt. We must combine the debt stacks and add the dividend cost.

    • Akzo Net Debt (Q1 2026): 3.1B EUR.

    • Axalta Net Debt (Q1 2026): 2,540M USD → 2.3B EUR.

    • Cash Outflow for Special Dividend: 2.5B EUR.

    • Total Pro-forma Net Debt: ~8B EUR.

  • Akzo-Axalta Enterprise Value

    • 11.4B + 8B = 19.4B EUR

• The Valuation Multiples of Akzo-Axalta

  • Implied EV/Sales: (Combined Revenue is ~17B USD or 15.5B EUR), so 19.4B / 15.5B EUR = ~1.25x

  • Implied EV/EBITDA: 19.4B / 2.75B EUR = ~7.05x

US valuations are usually higher than European valuations, even for companies in similar industries and with similar earnings profiles. Let’s see what their US peers trade at to gauge the potential valuation of Akzo-Axalta as a merged entity listed on the NYSE.

• Sherwin-Williams (SHW)

  • EV/Sales 3.5x-4.5x

  • EV/EBITDA 18x-22x

• PPG Industries (PPG)

  • EV/Sales 1.8x-2.5x

  • EV/EBITDA 11x-15x

• Axalta (AXTA)

  • EV/Sales 1.6x-2.5x

  • EV/EBITDA 8x-12x

Akzo-Axalta will have similar income profiles and debt ratios to PPG Industries. In addition, Akzo-Axalta’s product mix will also be similar to PPG Industries, with Axalta bringing in the automotive focus and Akzo bringing the Decorative and Industrial focus. For the sake of being conservative and having a Margin of Safety, let’s take valuation multiples below the lower end of PPG’s as our “US Relisting Valuation“ for Akzo-Axalta when listed on the NYSE.

With 1.6x EV/Sales and 9x EV/EBITDA - which are in the lower end of Axalta’s current multiples - Akzo-Axalta’s EV would be ~25B EUR. With 8B EUR merged Net Debt, its implied Market Cap would be 17B EUR, which on a per-share basis breaks down to 17B EUR / 312M shares = 54.5 EUR / share. From 36.54 EUR post-special dividend stub price, this is a ~50% upside.

With a conservative re-rating to lower than PPG Industries’ valuation, the merged entity presents a ~50% upside. Combined with the ~26% special dividend, the total upside on the initial 49.60 EUR entry is ~36%.

• Total holding at the end of the period: 13.06 cash + 54.5 EUR = 67.56 EUR

• Initial cost basis: 49.60 EUR

• Total return: (67.56 - 49.60) / 49.60 = ~36%

As mentioned in the prospectus, the cost synergies and US relisting upside may occur within the first 2 years - we’ll take a time horizon of 24-36 months instead. This implies an annualized IRR of 11%-17%.

A less conservative re-rating to the low end of PPG’s valuations:

• 1.8x EV/Sales leads to Akzo-Axalta’s EV of ~28B EUR, Market Cap of ~20B EUR and share price of 64.1 EUR.
  This leads to a total return of (13.06 + 64.10 - 49.60) / 49.60 = ~56%, and an annualized IRR of 16%-25%.

• 11x EV/EBITDA leads to Akzo-Axalta’s EV of ~30B EUR, Market Cap of ~22B EUR and share price of 70.51 EUR.
  This leads to a total return of (13.06 + 70.51 - 49.60) / 49.60 = ~68%, and an annualized IRR of 19%-30%.

This re-rating after a US relisting is not an imaginary thing. It is a well-studied phenomenon (link), and Akzo’s largest owner Cevian Capital has historically utilized this as a part of their playbook.

The Activist: Cevian Capital

Here is a free kicker to the arbitrage play for you: Cevian Capital, Europe’s biggest activist fund (and Swedish too!), doubled its stake to 10.15% in December 2025 with a price of around ~55 EUR per share, a month after the merger announcement. They took a board seat in Q1 2026.

• Stake vs. AUM: Based on publicly available sources I could find, Cevian’s AUM seems to be in the range of 16B-18B USD, Cevian’s ~1B USD stake in Akzo represents ~5%–7% of their total fund’s AUM. If this is correct, this is a high-conviction bet for them.

• Historical presence: Cevian was already here before the merger announcement, with about 5-6% ownership. I’m certain that they’ve had a significant role in pushing Akzo’s recent corporate engineering:

  • The “Industrial Excellence” program is supposed to deliver 250M+ EUR in annual savings.

  • The “Strategic Portfolio Review” is aimed at divesting non-core units to focus capital and resources on higher-margin, key global markets.

Considering the timing, it’s hard to believe that Cevian doubled their stake for any other reason than the merger announcement. I am also certain that they have done their legal homework against the FTC and EU antitrust reviews to ensure the merger actually happens (from Akzo’s side at least), which is most probably aligned with their activist strategy of divesting non-core businesses anyway.

Furthermore, Cevian Capital was heavily involved in a similar US relisting revaluation playbook in 2023 with CRH (from Dublin Stock Exchange to NYSE). They are also pushing for Pearson, another of their holding, to go through the same playbook, with Cevian’s co-founder Christer Gardell being cited saying that, “… we see an upside to the share of 30% to 40% from relisting.“

For Your Downside Protection

To hedge the risk of the merger failing, I’d strongly recommend you buy put options. Purchase Dec 2026 / March 2027 Puts with a strike price at 44 or 46 EUR (potentially a 2-3 EUR premium). This caps the Maximum Absolute Downside at 6-8 EUR per share from a ~50 EUR entry.

• If the merger fails, the put exercise protects your downside to about 16%

  • Loss from share price drop: 4-6 EUR

  • Loss from premium: 2-3 EUR

  • Loss per share is about ~8 EUR —> ~16% from current price

• If the merger proceeds with the most conservative case

  • Total holding: 13.06 + 54.5 EUR = 67.56 EUR

  • Cost basis: 49.60 + 3 EUR = 52.60 EUR

  • Total return (67.56 - 52.60) / 52.60 = ~28%

  • Annualized IRR of 9%-13%

  • With less conservative assumptions, the annualized IRR is up to 17%-25%

On the other hand, you can also just ride along with Cevian Capital as the current largest owner without buying any puts. If the merger fails, their presence guarantees that Akzo will press onward with operational efficiency and cost-saving measures even as a single entity, acting as your downside backstop.

The Double-Dip Opportunity

There might also be a double-dip opportunity embedded within this arbitrage, depending on exactly how the relisting process unfolds.

The transition to a sole NYSE listing may create an Index Churn dislocation (I say “may”, since I’m not entirely sure if this actually will happen). European index funds (AEX, Stoxx 600) will be forced sellers upon delisting from Euronext Amsterdam, while US index funds will potentially face a few quarters of lag due to eligibility approval.

This may represent a double-dip opportunity where one can use the special dividend (received in cash) to buy more shares of Akzo-Axalta on the NYSE during this forced-selling window. This allows for compounding at even more distressed multiples before US investors bridge the valuation gap. As Joel Greenblatt says in You Can Be a Stock Market Genius, opportunities present themselves when there’s non-fundamentally-driven selling pressure.

The Risks

• Dividend tax leakage: Be aware of how the special dividends will be taxed based on your individual situations!

• Antitrust Block: If the US FTC or EU Commission blocks the deal entirely, the merger and the 2.5B EUR dividend will be cancelled, and the stock will most likely drop. However, if you buy the put options, the downside protection is real. On the other hand, I’m certain that Cevian Capital has done their legal homework on the FTC/EU before doubling their stake.

• Integration Friction: Managing dual HQs (The Netherlands & US) could cannibalize the expected 600M US cost synergies. On the other hand, our pro-forma valuation also only assumes half of these cost synergies.

• Macro Volatility: A sharp decline in industrial and global auto builds would hit both Axalta’s and Akzo’s businesses simultaneously. On the other hand, we are actually already in a down-cycle for these industries. It could certainly go even worse from here, but who knows...

The Verdict

At the end of the day, this is an asymmetric risk/reward play. You are buying into a double catalyst: a 26% cash injection just for showing up, and a revaluation to higher-multiple in the US stock market. Another beauty of the trade is the double-dipping potential due to the index churn. With Cevian Capital riding shotgun (and put options putting a hard Floor if you choose to do so), the downside is protected.

I’m taking the trade.

P.S. I’ve ”accidentally” found two other non-Nordic special situations that I might (or might not) write about at some point.

• One is a multi-catalyst play with what I believe is a misplaced, distressed valuation of 2.7x EV/EBITDA.

• The other is a price discovery special situation via a subsidiary IPO (similar to the Akastor / HMH play).

Make sure you’re subscribed so you don’t miss them.

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

Date: 25 April 2026 (article release date may differ)
Ticker: LINDEX (Nasdaq Helsinki)
Price: ~2.245 EURO
Market Cap: ~375M EURO

If you spend enough time looking at special situations, you quickly learn that one of the most reliable ways to generate alpha is exploiting the removal of a “BadCo” from a “GoodCo” inside a messy conglomerate. Lindex Group is a textbook example.

However, setups like this are value traps unless unlocked by a forced catalyst. When you find a highly profitable business hidden behind a legacy turnaround - and you can pinpoint the signals that a catalyst is incoming - you have an asymmetric bet.

Let’s talk about Lindex Group (formerly Stockmann).

TL; DR

• Lindex Group is a classic GoodCo/BadCo break-up play. The company consists of a highly profitable fashion brand (Lindex) and a legacy, low-margin department store chain (Stockmann).

• Intrinsic Value: Stripping away the Stockmann noise, I put the “floor” valuation of the Lindex segment at ~510M EUR on an Owner’s Earnings basis, implying a 36% upside from the Group’s current market cap. In a bullish scenario using peer multiples, the Lindex segment’s equity value presents up to ~80% upside.

• The Catalysts:

  • The multi-year corporate restructuring officially ended in August 2025.

  • Management is “dressing the bride,” proving Stockmann finally has a positive adjusted operating result.

  • The Special Situation/Credit Fund exit window is rapidly approaching its 5-year mark.

Here comes the breakdown of the Lindex Group special situation. Let’s get to it!

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

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The Company

At its core, Lindex Group operates two entirely different segments.

The crown jewel is the Lindex segment, a highly successful, high-margin European fashion brand. It specializes in women’s wear, lingerie, and kidswear, which creates a deep moat of its own. After all, consumers might buy their shirts and pants at different shops, but how many people frequently change where they buy their everyday underwear? My better half is also a customer, and I honestly can’t complain…

The second piece is the Stockmann segment, an iconic chain of premium department stores. It is more of a cultural establishment, equivalent to Sweden’s Nordiska Kompaniet (NK), Denmark’s Magasin du Nord, and Spain’s El Corte Inglés. It also has the typical problems: massive physical footprints, huge lease liabilities, and a structural headwind against the entire department store business model.

The Problem

When you look at the consolidated group, the margins look thin and the debt (driven mostly by IFRS 16 leases) looks high. The parent company went through a severe corporate restructuring starting in 2020, where many of the Group’s assets and subsidiaries were sold and debts were restructured. For years, the financials were a tangled mess. But things are finally starting to shift.

The market also applies a conglomerate discount because nobody wants to assume the risk of the Stockmann division bleeding cash.

What if we split them up? What is the Lindex segment actually worth on its own?

The Numbers

To understand the true cash generation of Lindex, we need to strip away the Stockmann noise. Let’s calculate the Owner’s Earnings of the Lindex segment alone based on their reported Operating Free Cash Flow (Op FCF).

Lindex Segment Valuation

This is an Alternative Performance Measure strictly defined by management as: Adjusted EBITDA – lease payments +/- changes in net working capital – capital expenditure.

Eagle-eyed readers may notice a 3.9M discrepancy in 2023 between the division totals and the Group total. I assume that this represents the unallocated overhead Group costs. Since Lindex’s specific Op FCF isn’t explicitly broken out in the 2024 and 2025 reports, if we assume Lindex absorbs those HQ overhead costs as a standalone company, it makes our baseline numbers conservative.

There are three things we need to take notes from this alternative management measure to find pure Owner’s Earnings:

1. Taxes and non-lease interest: It does not subtract corporate income tax and interest expense that is not related to IFRS 16 lease costs.

2. Maintenance CapEx: The reported CapEx excludes restructuring costs and investments in the new omnichannel distribution centre (OCDC). This exclusion is actually helpful, as it ensures the remaining CapEx is purely maintenance CapEx - a prerequisite for Owner’s Earnings.

3. Lease Costs: We assume the lease payments deducted include both principal and interest components of the IFRS 16 lease costs, converting the financials back to a pre-IFRS 16 accounting.

Let’s do a quick calculation to prove this for their 2025 numbers: Lindex’s adjusted EBITDA is ~147M and total CapEx (maintenance + growth) is ~24.5M. The Group’s interest expense, lease repayment, and changes in Working Capital are -42.4M, -79.6M, and +13.2M, respectively. Since the interest expense is mostly lease-related, and Lindex’s lease burden is roughly half of the Group’s, we can approximate Lindex segment’s Op FCF:

147M - 24.5M - 0.5 * (42.4M + 79.6M - 13.2M) = 68.1M EUR

This back-of-the-napkin math lands incredibly close to management’s reported ~74.4M figure. The discrepancy being the adjustments from HQ overhead and restructuring costs, OCDC investment, as well as exact working capital splits.

Over the last few years, Lindex segment’s Op FCF has averaged roughly ~67M EUR. Now let’s do the necessary calculation to translate this number to Owner’s Earnings.

They do have a remaining restructuring bond of 73.1M EUR, but this is negligible because of 2 things:

• Their cash & cash equivalent is 71.6M EUR at the end of Q1 2026, with rotating credit facility of 40M EUR.

• The actual non-lease interest expense is very low at 3M EUR, since the restructuring bond only has negligible interest rate.

If we deduct the negligible non-lease interest expense (we take 2/3 for Lindex segment, based on their revenue distribution) from the 67M, we are left with roughly 65M EUR in pre-tax cash flow. Apply the standard 21% corporate income tax, and we get:

Lindex segment’s Owner’s Earnings: 51M EUR.

At a conservative 10x multiple to Owner’s Earnings, the Equity Value of the Lindex segment alone is 510M EUR. The entire Group is currently trading at a market cap of ~375M EUR - this is an upside of 36%.

FLASH UPDATE: The Q1 2026 Report (28 April 2026)

I finished this article before Lindex Group released its Q1 2026 interim report. The investment thesis is still strong and alive, but let’s cover the report briefly.

The Lindex segment’s dip in operating profit was not a demand issue (revenue actually grew 5.8%). The cause was stated to be transition costs for the new OCDC. The Group’s gross margins actually expanded (58.5% vs. 57.4%) despite the ongoing geopolitical crisis. The Stockmann division is becoming less toxic by the day, delivering its 8th consecutive quarter of improved results.

I’m honestly not too concerned with how they perform quarter-over-quarter. If the broader market sells off on the headline decline due to geopolitical situations, they are simply handing me a wider Margin of Safety when the eventual catalyst happens.

Let’s continue on with our journey for now.

Valuation Multiples VS Peers

Let’s look at this through an EV/EBITDA lens to see if the math holds up against industry peers.

Lindex reported an EBIT of 72.1M EUR for 2025. If we add back their depreciation and amortization (mostly IFRS 16 lease depreciation), we get a reported EBITDA of roughly 147M EUR.

I honestly do not like this figure. It is artificially inflated because cash rent payments are added back as depreciation. While this is technically true for the peers we’ll compare them against, as a conservative junkie, I prefer to apply a massive 30% haircut to this EBITDA number - chopping that 147M figure all the way down to a clean 100M EUR (it’s also easier to calculate).

Let’s look at where their Nordic peers are trading on an EV/EBITDA basis:

• H&M: 7.5x - 8.5x

• Björn Borg: 8.0x - 14.0x

• Marimekko: 8.0x - 15.0x

• RVRC: 10.0x - 15.0x

If we apply a highly conservative 7.5x to 10x multiple to our stressed 100M EBITDA, we get an Enterprise Value of 750M to 1,000M EUR.

Now, we subtract Lindex’s standalone share of the lease liabilities (~290M EUR) and the remaining ~10M EUR in net debt that is not covered by their cash position.

• Implied Equity Value: 450M - 700M EUR (A 20%-87% upside from today’s price).

(Note: If we didn’t apply the 30% haircut to the 147M EBITDA, this range would be 800M - 1,170M EUR - a multi-bagger. But let’s be conservative.)

No matter which way you cut the math, the Lindex segment alone is worth significantly more than the current market cap of the entire conglomerate.

The Catalysts

You can have the cheapest GoodCo in the world, but without a catalyst, you are just holding a value trap. Management has been formally exploring strategic alternatives for Stockmann since late 2023. Why would this time be different?

I see that three converging signals are forcing the catalyst:

1. The Restructuring Overhang is Gone. It is incredibly difficult to carve out or market a business burdened by court-mandated restructuring constraints. That multi-year legal process officially concluded in August 2025. This upcoming summer is the first time a potential buyer can look at the trailing 12-month performance of Stockmann without any lingering legal asterisks. The restructuring bond of 73.1M is maturing in July 2026. Once this is paid down or refinanced, the trace of their restructuring mostly vanishes.

2. Dressing the Bride. In recent reports, management kept highlighting Stockmann’s turnaround, noting: “The Stockmann division’s adjusted operating result for the year improved to EUR 1.2 million, being for the first time positive after many years.” They are proving to buyers that Stockmann has the potential to finally be profitable.

3. The Credit Fund Exit Window. Denali European Opportunities Fund - managed by London-based North Wall Capital - is the second-largest owner. Their Chief Investment Officer, Fabian Chrobog, sits on the Nomination Board. North Wall is a special situation/credit fund. By definition, they do not hold equities for long; they are transaction-driven. By late 2026, they will have been in this trade for over 5 years. As the fund’s IRR clock ticks down, they have every incentive to force a value realization event.

The Strategic Buyer Bonus: Look closely at the largest owner, Nordic Retail Partners JV. This is a joint venture consisting of a Finnish foundation and JC Switzerland Holding AG, the holding company associated with the European retail giant Peek & Cloppenburg (P&C).

P&C has been highly acquisitive: they attempted to buy the German chain SiNN and has previously acquired Denmark’s Magasin du Nord. Stockmann fits their playbook perfectly. A ready-made buyer is already sitting in the cap table.

The Risks

• It needs to be emphasized that the divestment of Stockmann may not actually be the outcome. This is what the Board explicitly said:

  “As part of the investigation of strategic alternatives for Stockmann’s department stores business, the Board is evaluating the best environment for developing the business in the future. These options include increasing the business’ independence within the Group, considering possible ownership changes or strategic partnerships, or continuing under the current structure.“
  So don’t get mad if this turns out not to be a break-up play after all, though it does seem to be the most logical and probable outcome.

• Opportunity Cost: How long are you willing to wait? If the Stockmann divestment is announced this year, the ~32% total return to our 510M EUR base case yields an excellent annualized IRR. However, if the management/Board drags its feet:

  • Unlocked in 1 Year: ~36% IRR

  • Unlocked in 2 Years: ~17% IRR

  • Unlocked in 3 Years: ~11% IRR. Time is the enemy of special situations.

  My best guess is in 2 years (Q1/Q2 2028), since by then North Wall will have been in the trade for almost 7 years. But who knows, really…?

• Macroeconomics & Geopolitics: With the current 2026 geopolitical disruptions, global spot freight rates are spiking. This might compress Lindex’s margins. But if you think about it, these effects are global and most companies would experience similar margin compression. And let’s be honest, their customers will still need to buy their lingerie from their favorite shop come war or crisis.

• What do they need to do to divest Stockmann? Three Scenarios:

  • Base Case: Sold for €0. The buyer takes the stores and assumes the 300M+ EUR in lease liabilities.

  • Best Case: Sold for a conservative P/S multiple or just the conservative value of their physical inventory (<50M EUR cash windfall).

  • Worst Case: The Dowry. Stockmann is still viewed as toxic, and Lindex Group has to pay a buyer to take the leases off their hands. Even in this worst-case scenario, the Lindex segment’s cash generation quickly backfills the cost.

• Capital Allocation: Post-divestment, will management return Lindex segment’s Owner’s Earnings to shareholders via dividends, or will they diworsify by hunting for new acquisitions? Since my investment philosophy is event-driven, I hope to be cashed out before we find out.

The Verdict

Lindex Group is a textbook GoodCo/BadCo special situation. The downside is heavily protected by the Lindex segment’s Owner’s Earnings. The upside will be unlocked the moment the break-up is finalized.

Even if they have to give Stockmann away for free, severing the BadCo will trigger the re-rating. At the current price, you are buying a high-margin, cash-printing Nordic fashion brand at a steep discount. Your worst enemy here isn’t bankruptcy; it’s patience.

As the special situation mantra goes: sometimes the most profitable form of addition is often a simple subtraction.

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

Date: 28 March 2026 (article released date may differ)
Ticker: AKAST (Euronext Oslo)
Price: ~15.20 NOK (Norwegian krona)
Market Cap: 4.13B NOK

In my last Akastor article in February, I laid out the hidden signals buried deep within HMH’s SEC filing - specifically the shift from “Phantom Awards” to Restricted Stock Units (RSUs) vesting in September 2026. I argued that this was the ticking clock for a liquidity event.

Read the original article here:

Well, the delivery arrived half a year early. A week ago, Akastor officially announced the launch of HMH’s Initial Public Offering (IPO) on the Nasdaq under the ticker symbol “HMH.”

But the market’s reaction? Underwhelming, to say the least. There is no price discovery POP. Why is the reaction so muted? Did the stock already run up too much in anticipation (up ~30% year-to-date), or is the IPO price tag just disappointing…?

In this article, we’ll break down the newly released numbers, update our previous valuations and discuss potential actions.

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

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The Numbers: What the IPO Means for Akastor

In my previous article, I took conservative assumptions to find the “Floor” valuation of HMH, calculating an equity value between 467M USD (multiple-based) and 675M USD (cash flow-based).

The official IPO numbers are out, so we no longer have to guess. Here are the facts from the latest SEC filing and Akastor’s press release:

• Total shares outstanding post-IPO: 44,000,000

• Shares offered: 10,520,000 Class A common stock

• Price Range: $19.00 to $22.00 per share.

If we take the mid-point i.e. $20.50, the implied Total Equity Value of HMH is ~902M USD.

At first glance, this looks like a massive win! An equity value of 902M USD is significantly higher than my previous DCF estimate of 675M USD. So why isn’t Akastor’s stock soaring? The devil is in the details of Akastor’s slice of the pie.

Let’s recalculate Akastor’s HMH-only intrinsic value based on this new reality:

• Akastor’s Retained Stake: Following the IPO, Akastor will own approximately 37% of HMH (down from their 50% stake due to new shares being issued).

  • Value of 37% stake (at $20.50/share): ~334M USD

• Cash from Sold Shares: Akastor is exchanging a portion of its ownership - as a compensation for being diluted - for net cash proceeds.

  • Cash received: ~20.2M USD

• Shareholder Loan Repayment: In my last article, I noted HMH owed its shareholders 132M USD, implying Akastor’s half was roughly 66M USD. However, the press release explicitly states that only ~27M USD is expected to be net payable to Akastor.

  • Loan repayment received: ~27M USD

Total HMH’s Value to Akastor: 334M + 20.2M + 27M = ~381.2M USD.

Now, let’s translate this back to NOK (using today’s ~9.70 NOK/USD exchange rate).

• 381.2M USD = ~3.7B NOK.

• Add Akastor’s Net Cash: 197M NOK

  • From 2025 year end: 87M NOK.

  • Plus Skandi Atlantic sale: 22.75M USD —> ~220M NOK

  • Less Q1 2026 Extraordinary dividend: 110M NOK

• Akastor’s Updated Intrinsic Value: ~3.9B NOK.

If we take the scenario that the underwriters buy up to 15% more shares than originally planned - resulting in additional 15.2M USD for Akastor and 35% stake, this will result in:

• Value of 35% stake (at $20.50/share): ~316M USD

• Cash from sold shares: 35.4M USD

• Cash from loan repayment and Akastor’s Net Cash: 27M USD + 197M NOK

• Akastor’s Updated Intrinsic Value: ~3.87B NOK

If we take the top end of the range i.e. $22/share - Akastor’s Updated Intrinsic Value would be 4.13B NOK.

As of this writing, Akastor’s market cap is already sitting at 4.13B NOK.

The message here is that the market values their other subsidiaries (AKOFS and DDW Offshore, NES Fircroft) essentially at 230M NOK (at the midpoint of HMH price tag) or 0 (at the top end of HMH price tag).

Does this make sense? Looking at Skandi Atlantic’s sale price - which may reflect the values of the other vessels of their subsidiaries - it seems low. But on the other hand, these vessels are illiquid unless sold, leading to the typical discounted NAV phenomenon.

The Conclusion

The massive price discovery event we were hoping to break open was mostly muted by the new share issuance mechanics. The market actually has HMH priced quite efficiently based on HMH’s IPO price tag. While the floor was indeed near, the ceiling wasn’t much higher. Even if HMH is priced at the top end ($22), the upside is uninspiring.

What to do now?

The catalyst played out perfectly, but the end results tell us that the market is valuing Akastor somewhat efficiently. Knowing this information, is there anything more here?

1. The actual IPO (next ~2 weeks): There is a possibility that HMH trades higher than $22 when they finally hit the open market, creating some upside. However, speculating on this does not offer Margin of Safety.

2. The 180-Day Lock-Up & Selling Pressure: As I warned in my original article, Baker Hughes (and potentially Akastor too) likely wants out. Once that 180-day lock-up expires, there is a high probability that HMH shares will be dumped onto the open market. This may create downward pressure on HMH’s stock price later this year - potentially presenting a “double-dip“ opportunity for us down the road.

3. The drilling up-cycle: I still believe that the drilling up-cycle is coming. However, the Transocean-Valaris merger may cap the upside, and it is also a speculation on macro environments and HMH trading price, offering little Margin of Safety.

We read the catalyst signals right. We correctly valued Akastor’s HMH conservatively that the Margin of Safety offered some upside despite somewhat uninspiring end results. Now, it’s up to each of us to wait and see how HMH trades, or to take our capital and search for the next asymmetric bet.

I, for one, am planning to liquidate my holding soon, so this most probably will be my last article on Akastor. I am only up ~15% from my cost basis - not bad considering a holding period of about 2 months. Have a look at my public portfolio below if you are interested.

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

Date: 22 March 2026
Ticker: DURC (Nasdaq Stockholm)
Price: ~17.5 SEK (Swedish krona)
Market Cap: 681M SEK

If you have read Chris Mayer’s book 100-Baggers, you may be inspired to find a company that returns $100 for every $1 invested. Everyone wants to find the serial acquirer that is going to be the next Constellation Software. It sounds sexy.

But most investors often forget a crucial lesson from Mayer’s book: the Twin Engines. They focus entirely on one of the engines (Growth) and completely ignore the second: Multiple Expansion.

When you buy a fast-growing serial acquirer at high multiples, the second engine becomes a massive drag. That one working Growth engine has to work harder to drag the Multiple Expansion engine with it i.e. the company has to outgrow its own valuation. But when you find a company capable of compounding capital that is currently priced at low multiples, the Twin Engines are finally working for you.

Now there’s 2 ways you can find companies with Twin Engines:

• The sexy path: You find them when they are small. But who are we kidding, our batting average is most probably lower than Chris Mayer - at least I’m sure mine is. My chance of finding the next Constellation Software - or even just a Lagercrantz or Vitec - is extremely low.

• The unsexy path: You find a mispriced serial acquirer that has shown proof of its turnaround, but the market has not realized it yet. Now this I can do. Let’s talk about Duroc AB.

TL; DR

• Duroc AB is a serial acquirer with “good“ Industrial units and “bad“ Fiber/Polymer units. In December 2024, management has explicitly stated that they would divest 3 of the Polymer units.

• The “invisible” transformation. Throughout February and March 2026, Duroc finalized a sale of one of their Polymer units and 4 new acquisitions. They practically traded off a unit with negative EBIT with 4 units with a total of ~25M SEK in annual EBIT + 50M SEK in cash. These events have been mentioned in the report, but have not been consolidated on paper yet.

• Intrinsic value: My calculated ”floor” is close to ~817 MSEK or 21 SEK / share (a 20% upside). My second soft “floor“ is 15 SEK / share (down 15%). The potential upside may be north of a doubling from current price.

• The Catalyst:

  • Divestment of Polymer unit #1 was done in February 2026.

  • Divestment of Polymer unit #2 is a near-term catalyst: between April/May.

  • Divestment of Polymer unit #3 will be the mid-term catalyst.

• The activist: Peter Gyllenhammar, the Corporate Engineer.

Here comes the granular breakdown of the Duroc turnaround. Let’s get to it!

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

The Company

At its core, Duroc is a serial acquirer with a focus on B2B industry and trade. They operate in a highly decentralized manner - typical of a Swedish serial acquirer - meaning the parent company in Stockholm is just a small capital allocation team, while the subsidiaries operate independently with their own local management.

Think of it as a mini-Berkshire for European industrial niche. The “Good” part of the portfolio consists of high-quality industrial businesses. Their heavy lifters include Duroc Machine Tool (DMT), one of the largest suppliers of machine tools and aftermarket service in the Nordics, Duroc Rail, a virtual monopoly providing maintenance for railway wheels in northern Sweden and Broddson, a leader in street sweepers and road maintenance.

Beyond these, they hold a Smaller Company Portfolio comprising niche market leaders like UPN (industrial diesel engines), Herber (bending machines), DLC (laser coating) and others. These companies share a common DNA: they are AI-resistant, have niche market positions, and quietly print cash.

The Problem

If the industrial core is so great, why does the stock chart look like a flatline? The answer lies in the company’s historical exposure to the textile and plastics industry. The high-quality Industrial & Trading core is buried under the suffocating weight of Duroc’s polymer-based units, the “Bad“ part of the portfolio.

In December 2024, management has explicitly stated that they would divest 3 of these units. For simplicity, let’s divide these “Polymer Units” into three: Asota, IFG UK, and Drake US.

Unlike the industrial trading side, these Polymer units are capital-intensive, cyclical, with thin margins. When the macroeconomic environment shifts - such as sudden spikes in energy costs or supply chain gluts - these units bleed cash. Here is their numbers from the FY 2024/25:

• Asota and IFG UK: 980M SEK Net Sales, 3M SEK EBIT

• Drake US: 551M SEK Net Sales, -53M SEK EBIT

The problem is not that these Polymer units are not working, it is simply because there is not enough vertical synergy in Duroc that would help them to be profitable. What loses money for Duroc may make money for larger global players.

The Numbers

To understand the true cash generation of the "New Duroc," we need to strip away the noise. Let’s calculate the Owner's Earnings of the RemainCo (the Industrial Core) based on the proforma numbers in their recent financial report (page 3). For maintenance CapEx, we assume it to be the same D&A as calculated by subtracting EBIT from EBITDA.

NOTE: Duroc’s accounting year is July to June. Yes, yes, I know it’s annoying for me too, but nothing to do.

1. The RemainCo Baseline

• Revenue: 1,580M (FY) || 1,473 (TTM)

• EBITDA: 119.9M (FY) || 82.7M (TTM)

• EBIT: 91.6M (FY) || 47.4M (TTM)

• Maintenance CapEx (D&A): 28.3M (FY) || 35.3M (TTM)

  • This is roughly 1.8% to 2.4% of revenue.

• Group’s Total IFRS 16 Lease Costs: 36.6M (FY) || 28M (TTM)

  • RemainCo holds 215.2M of the Group’s 291M lease liabilities (74%).

• Cash Flow from Operations (CFO): 134.2M (FY) | 138.0M (TTM)

Why the huge discrepancy between FY 24/25 and TTM EBIT, while Cash Flow stayed consistent?

1. The Rail Move: In Q1 25/26, Duroc Rail accounted for -11.6M SEK in EBIT due to the relocation of operations and a lower production rate. This is a one-off restructuring cost for long-term increase in capacity upgrade.

2. Timing: Lumpy project deliveries in some segments.

3. Inventory Release: In their November press release, “…initiated actions aimed at releasing capital tied up in other operations as well as in tangible assets…“, I assumed that this mostly has to do with the Polymer units winding down production preparing for the sale.

To be conservative, we’ll average out the FY and TTM numbers for our Owner’s Earnings.

CFO (136M) - Maint CapEx (32M) - 74% Lease Costs (24M) = 80M SEK.

RemainCo’s Owner’s Earnings baseline: 80M SEK.

If we simplify the Owner’s Earnings as a percentage of sale, this would be:
80M / 1,500B = 5.3%. This will be relevant later on.

We do not take into account the debt for now, because what’s coming next.

1.1. Why Less is More - Episode 1

Duroc sold Asota for ~175M SEK in Enterprise Value, whereby 80M is net interest-bearing debt and 18M in pension provisions, resulting in a cash proceeds of 77M SEK.

Total Group’s Total Interest-Bearing Debt (excld lease liabilities) is 163.3M SEK before the sale. Thus, the Total Debt of the Group is practically wiped out with this sale.

Taking into account that Asota contributes to -8.4M SEK in EBIT for the period July-December 2025, this is a great deal for Duroc!

1.2. Why More is also More - Episode 1

While divesting the low-margin asset, Duroc simultaneously acquired high-margin niche industrial firms. Alongside the Q2 report (Oct-Dec 2025 period), management announced the acquisition of four companies: Polyproject Environment, Thors Trading, Hydrostandard Mätteknik, and Optyma Security Solutions. However, similar to the Asota sale, the completion of these acquisitions was not consolidated in the report.

The acquisition here is textbook value investing and top-notch serial acquirer.

• Combined Purchase Price (EV): SEK 121 million

• Combined TTM Sales: SEK 240 million

• Combined Adjusted EBIT: SEK 25 million

• Implied Acquisition Multiple: 4.84x EBIT

• This acquisition is financed through a loan on market terms

Duroc is selling a sub-0% margin business (Asota) and buying ~10% margin.

Assuming similar percentage of Owner’s Earnings to Sales for these new 4 acquisitions with respect to Duroc’s RemainCo:

Owner’s Earnings of the 4 acquisitions: 5.3% x 240M = 12.7M SEK

1.3. The already-done-but-not-in-the-books valuation

Now, let’s take a moment to value RemainCo based on the things they have done but yet to be consolidated on paper.

• Owner’s Earnings: 80M + 12.7M = 92.7M SEK

• Assuming an EV of conservative 10x multiples: 927M SEK

• Group’s Total Interest-Bearing Debt:

  163.3M (Total Q2 25/26) - 175M (Asota sale) + 121M (acquisitions) = 110M SEK

• The implied Equity Value is 817M SEK. This is in itself an upside of ~20% from current Market Cap of 681M SEK!

I would even consider this 817M SEK a “Floor” valuation due to the conservative assumptions:

• The 10x multiple assumes no growth with required return rate / WACC of 10%.

• The 80M SEK RemainCo’s Owner’s Earnings is averaged down by the Rail relocation cost and delayed in project delivery payment.

• The 110M SEK Debt is the Total Group’s proforma Interest-Bearing Debt, NOT Net Debt and NOT RemainCo’s Net Debt i.e. cash positions are ignored.

• The calculation assumes that the remaining 2 Polymer units are sold at 0 and RemainCo takes over all the remaining debt.

• Duroc had a press release in regard to the transfer of pension & COVID support - totaling about 50M SEK, which are not taken into account in my calculation.

If you’re into valuation multiples, we can also calculate the valuation in EV/EBITDA. The latest report mentions the Group’s Net Debt (incld IFRS 16 leases) to be 375.5M SEK - more than doubled previous year because of the new 20-year Rail facility contract (lease liabilities are always highest at the start). We then need to include the Asota sale and the 4 new acquisitions.

• Proforma Net Debt (incld leases): 375.5M - 175M + 121M = 322M SEK

• EV = Market Cap + Net Debt (incld leases) = 1,003M SEK

• Let’s calculate EBITDA as RemainCo’s EBITDA + new acquisitions’s EBIT (EBIT is more conservative than EBITDA).

  • Proforma EBITDA: (119.9M + 82.7M) / 2 + 25M = 126M SEK

• Proforma RemainCo’s EV/EBITDA: 7.9x

• Proforma NetDebt/EBITDA: 2.5x

Just for comparison, a quick check on other Swedish industrial serial acquirers:

• Lagercrantz: EV/EBITDA 25.9x, NetDebt/EBITDA 2.5x

• Indutrade: EV/EBITDA 15.3x, NetDebt/EBITDA 1.4x

• Lifco: EV/EBITDA 20.3x, NetDebt/EBITDA, 1.3x

Now maybe you’re thinking, Duroc’s proforma multiples and upside don’t really scream cheap. Well, I guess that depends what your definition for cheap is. For me, it really indeed is not cheap enough, although the downside is protected by the Owner’s Earnings.

Nevertheless, the transformation is not completed yet. We still have IFG UK and Drake US to be divested.

1.4. Floor valuation based on balance sheet

Before continuing, let’s first get a picture of Duroc’s floor valuation based on their balance sheet. To simplify things, we’ll calculate the Group’s Net Tangible Asset value from their last report (period ending 31 Dec 2025):

• Total Equity: 1,088M SEK

• Goodwill: 119M SEK

• Other intangible assets: 25M SEK

• Net Tangible Asset value: 944M SEK

The Net Tangible Asset value is higher than the Owner’s Earnings basis floor valuation of 817M SEK.

Their Total Current Assets (1,021M SEK) is also higher than their Total Liabilities (970M SEK). This proves further that Duroc is indeed trading close to its floor valuation.

Duroc’s Final Transformation

2.1. BIG’s small catalyst: April/May 2026

The buyer of Asota, BIG (Beaulieu International Group) had the option to buy IFG UK (the second Polymer unit) within 3-month of the Asota deal - meaning around late April or early May 2026.

2.2. Why even less is more - Episode 2

To build the final transformation picture, let’s imagine the complete divestment of the remaining 2 Polymer units: IFG UK & Drake US. Their recent H1 25/26 (July - Dec 2025) EBITs are dismal:

• IFG (UK): -6.5M (-14.9M IFG total - -8.4M Asota), annual run rate of -13M SEK

• Drake (US): -17M SEK, annual run rate of -34M SEK

Looking at the EBIT numbers, it is easy to assume they are worthless, but they do still have inventory and machines to sell. So let’s use a highly conservative liquidation value.

• The total Book Value of the 3 Polymer units was 427.6M.

• Minus Asota (~116M BV), the remaining Book Value is ~312M SEK.

• Let’s assume a fire-sale at just 35% of Book Value.
  Note: Asota was sold for ~70% of BV, so this is conservative. We’ll take it as our Margin of Safety.

• A 35% fire-sale yields roughly 109M SEK in cash.

2.2. Why even more is even more - Episode 2

Now, what does Duroc do with that 109M SEK? If they deploy it with the same discipline they used in February (buying 12.7M of Owner’s Earnings and 25M of EBIT for 121M), that 109M turns into ~11.4M SEK of Owner’s Earnings and 22.5M SEK of EBIT.

2.3. The final transformation’s valuation

Owner’s Earnings basis

• Final Owner’s Earnings: 80M + 12.7M + 11.4M = 104M SEK

• Assuming an EV of conservative 10x multiples: 1,040M SEK

• Group’s Total Interest-Bearing Debt: 110M SEK

• The implied Equity Value is 931M SEK. This is an upside of ~37%!

Valuation Multiple basis

• Net Debt (incld leases) is still 322M SEK

• EV (incld leases) is still 1,003M SEK

• Final EBITDA: (119.9M + 82.7M) / 2 + 25M + 22.5M = 149M SEK

• Final EV/EBITDA: 6.7x

• Proforma NetDebt/EBITDA: 2.1x

The same conservative assumptions from our previous calculations are still applied here. The conservative assumption is even added by the 35% of Book Value sale of the 2 remaining Polymer segments.

If we assume that the divestment of Polymer units and subsequent acquisitions are completed within 24-month window, the annual IRR is ~17%.

Now, let’s assume some upside scenarios:

• If the market applies 15x multiple to Owner’s Earnings, this will result in an implied Equity Value of 1,450M SEK - an upside of ~110%.

• If the market applies 13x EV/EBITDA - still far below Lagercrantz, Indutrade and Lifco - this will result in an upside of ~130%.

• If they manage to sell IFG UK and Drake US at 70% Book Value instead of 35%, this will convert into 22.8M Owner’s Earnings and 45M SEK EBIT from new acquisitions.

  • In 10x Owner’s Earnings basis, this leads to implied Equity Value of 1,045M SEK - an upside of 51%.

  • An EV/EBITDA multiple of 5.6x, and NetDebt/EBITDA 1.6x

2.4. The unsexy path to a multi-bagger

With the floor valuation (in cash flow and balance sheet basis) above the current Market Cap, the asymmetric risk/reward is definitely there. The downside is protected, while the upside can be any number of (hopefully pleasant) surprises.

I’ve also been doing the same mistake I mentioned from the start though. I only discussed one of Chris Mayer’s Twin Engines - though I’m sure I’m addressing the more neglected part of the engines (Multiple Expansion). What about the other engine then i.e. Growth?

I believe with our conservative Owner’s Earnings of 80M SEK at the current state, or 104M SEK at the final state, Duroc would be able to grow by buying more niche companies. As long as management is disciplined in buying with private equity multiples, the conversion into serial acquirer multiples will take care of the second engine.

The Activist: Peter Gyllenhammar

None of this play and corporate engineering is accidental. Duroc is overseen by Peter Gyllenhammar. Gyllenhammar is a legendary Swedish Corporate Engineer who specializes in liquidating negative-yielding assets to unlock value. In the 1990s, He turned £50K into tens of millions in less than 10 years with this playbook. He has been languishing after buying his way into Duroc in 2017, but Duroc’s current plan is very typical Gyllenhammar. I bet my money on him that they will follow through with it satisfactorily.

Once the Polymer units are entirely eradicated and Duroc’s core is a clean, cash flow positive compounding machine, his playbook points to one possible outcome: a block trade sale to another investor or a larger Swedish consolidator (like Addtech or Indutrade) at a massive premium. This playbook can be seen in Studsvik (partial exit in 2025) and Galjaden (trade sale in 2021).

Whether he treats Duroc as an exit vehicle, or he treats it like Warren Buffet treating Berkshire Hathaway is still to be seen (Gyllenhammar is over 70 though). In any case, when it comes to corporate engineering (Duroc’s current state) and buying good businesses at cheap price (Duroc’s final state), I prefer someone like him to be at the helm.

BONUS: Gyllenhammar entered Duroc in 2017 at an implied entry price of 15 SEK. This serves as another “soft“ floor valuation.

The Risks

• The Gyllenhammar factor

  Gyllenhammar holds roughly 80% ownership. The 80% ownership creates an illiquidity trap - the low free float prevents massive institutional buying right now, which is exactly why the stock is mispriced. However, a low free float is actually our advantage as retail investors. This means that 80% of the stocks will not be sold - or at least won’t be sold unnecessarily. On the other side, if Duroc’s fundamentals improve, the low float would offer a violent re-rating of the share price.

• The opportunity cost - Episode 1

  The entire thesis relies on the successful execution of the divestment strategy. We know Asota is sold, but what if BIG does not go through with their option to buy IFG UK later this spring? What if management can’t find buyers for Drake US? If these units remain stuck on the balance sheet, the cash won't be freed up to fuel the Twin Engines. Again, our key here is the Gyllenhammar / activist factor.

• The opportunity cost - Episode 2
  Buying four companies at 4.8x EBIT in one month was a masterstroke by the management, but capital allocation is rarely that smooth. Finding deals that cheap takes time, especially with other serial acquirers scouting for similar companies. If the cash sits on the balance sheet for two years earning meager interest, the "Twin Engine" compounding stalls out.

• The unknowable factors

  Beyond corporate engineering, there is also business risk. Duroc Rail is an absolute cash cow, but its main customer is LKAB, the state-owned Swedish mining giant. Duroc Rail relies heavily on maintaining the wheels of the massive iron ore trains traveling along the Malmbanan (the Iron Ore Line) in northern Sweden. This railway infrastructure is notoriously plagued by maintenance debt and derailments. It is unfortunately a localized infrastructure risk that is out of our hand. The same risks can be applied to Duroc’s other industrial subsidiaries.

The Verdict

Duroc is a special situation hidden in plain sight. At current price, you are buying a seat next to a master in corporate engineering, with a Margin of Safety baked in.

Duroc and Gyllenhammar will prove that both subtraction and addition are the ways to reach the arithmetic of wealth. By amputating the capital-bleeding Polymer units and aggressively deploying that capital into high-margin industrial niche, hopefully we will reach Chris Mayer’s Twin Engines. Maybe not 100-bagger, a 2-bagger is more than enough for me.

Who needs sexy when you know that simple subtraction and addition can bring money.

Disclaimer: I am not a licensed financial advisor. I hold a position in the security discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

• Catalyst 1: The Kapatens litigation - the market was pricing the company for a catastrophic legal defeat, while the most-likely monetary ruling shows an undervalued, profitable company.

• Catalyst 2: The planned separation of Dynava to unlock a high-margin SaaS model backed by the largest owner Azerion’s tech.

Read the original investment thesis here:

Since my first article, the share price has appreciated by ~40%. Catalyst 1 was resolved with better results than our most-likely assumptions. The Q4 2025 report dropped in with a proof that the business pivot is progressing positively. With a huge dividend yield as a cherry on the cake - a 9% yield at current price of ~0.55 SEK - Eniro is finally paying shareholders to wait until the turnaround has fully taken place.

Is there still an upside here? Here is the TL;DR

• Intrinsic value: with the finalized litigation numbers and conservative assumptions (no growth, depressed Dynava divestment). At 0.55 SEK, Eniro is still trading below the updated “floor” intrinsic value of 0.65 SEK / share.

• Ownership change: Mats Qviberg has entered as the dominant owner (17%). His track record demonstrates a master of spin-offs and restructuring - supporting the fast realization of Catalyst 2.

• The CEO’s warrants: In the same week Qviberg entered, CEO Hosni Teque-Omeirat paid 400,000 SEK to acquire 40 million call options. With a price of 0.01 SEK, these warrants are likely to be deep out-of-the-money or very short-term.

• Margin of Safety vs Momentum Signals: The Margin of Safety has fundamentally eroded somewhat based the conservative valuation. Nevertheless, the momentum, ownership change and CEO’s warrants are definitely positive signals.

• Despite being skeptical about the valuation and the warrants, I’m holding.

For those who want some more details, read on. This article covers my updated valuation and investment thesis on Eniro. Let’s get to it!

Disclaimer: I am not a licensed financial advisor. I hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

Catalyst 1: The litigation resolution

For the past few years, the Kapatens lawsuit was a fog hanging over Eniro’s share price. The uncertainty was definitely there, with the worst case - however unlikely - being bankruptcy or massive share dilution.

On 10 Feb 2026, Eniro finally announced an agreed settlement with Kapatens. On 18 Feb, the Supreme Court dismissed the case entirely. The litigation is officially resolved. This completely eliminates the catastrophic downside tail-risk that was baked into the stock price, instantly raising Eniro's "floor” and bringing much-needed clarity.

The case was settled for a mere 17M SEK. My original most-likely investment thesis put the monetary ruling at roughly ~40M SEK, so this is a massive win for the company (and for us).

The Q4/FY 2025 report

The numbers

As a whole, the financial numbers are actually disappointing: flat in total sales, decrease in operating and net profits, decrease in operating cash flow. The only positive thing is Marketing Partner’s Annual Recurring Revenue (ARR) growth: increased to 537M SEK from 489M SEK in the previous year.

Are you confused? I was. I wondered whether these numbers signify positive or negative results? Well, let’s look under the hood and scrutinize the Q4/FY 2025 report [1].

• Page 6 in the report implies that the stagnation seems to be more structural at first glance. They explicitly state that the Marketing Partner segment saw a top-line increase of 56M SEK (10%) compared to 2024, which sounds great until you realize the recent acquisitions of Medialuotsi and Qwamplify contributed 72M SEK. This means organic sales in the core Marketing Partner segment actually shrank.

• So, how is it possible that organic sales declined, but ARR increased by 10% to a record 537M SEK? It seems that as a whole, Eniro is actively shedding its one-off transactional revenue faster than it is adding new recurring subscription revenue. The “quality” of the revenue is improving (shifting to ARR), but the “quantity” (total organic sales) is temporarily shrinking as the legacy business drains out. Furthermore, acquiring companies like Medialuotsi and Qwamplify buys immediate ARR, but comes with integration and restructuring costs (12M SEK in 2025), which explains the hit to EBITDA and Operating Profit.

• So long story short, they are essentially paying the price now to build a larger ARR base for the future - by growing inorganically and paying for the integration and restructuring costs. I personally would see it as a positive thing. I would start to worry when the ARR decreases or when the acquisitions become unreasonably expensive.

• What about Dynava? Well, Dynava is doing its best but it still actively dragged the ship down, losing 52M SEK in net sales (a 14% drop) and negative bottom line. The focus on Dynava seems to be to improve internal efficiency and focus on automation.

What about the balance sheet?

• Net Cash position: The company’s net cash position at year-end stands at a robust 189M SEK (up from 163M SEK last year). With practically no debt (except for the pension liabilities), this cash represents a massive operational leverage and potential shareholder value.

• Pension Liabilities: The company’s pension obligations amounted to 268M SEK for Q4 2025. This is a significant amount relative to Eniro’s market cap, so it is important to take this into account in our valuation.

The high dividend yield

The biggest surprise in the report: the board’s proposal of a SEK 0.05 per share dividend. At the then trading price of ~0.40 SEK, that represents a >12% dividend yield. The management and board seems to signal the profitability of the business. This dividend costs the company ~36M SEK - is this sustainable?

• This is easily covered by their 189M SEK cash pile.

• In my original article, I estimated the Marketing Partner’s conservative Owner’s Earnings to be 50M SEK - so the dividend is also covered by Owner’s Earnings.

Catalyst 2: The Dynava spin-off

The report only mentions that the board decided to evaluate a separate listing of Dynava in February 2025. As mentioned in my original analysis, Carlsquare has been mandated to prepare the proposal in Q1 2025. Cost-efficiency measures are being implemented, while the segment is still bleeding cash. Nothing new here, except for the ownership change that I believe will push a quick realization of Catalyst 2.

The updated valuation

With the legal fog gone, let’s update our valuation:

1. Marketing Partner: Even though the ARR has hit even higher numbers of 537M SEK, I really can’t help but to be conservative when it comes to valuation. I will use the conservative assumptions from my original investment thesis:

   • Owner’s Earnings: 50M SEK

   • No growth for year 1-10.

   • Exit multiple of 10.

   • However, I will change the required rate of return from the previous calculation from 15% to 10% - representing less risk due to the litigation case being resolved.

   • The Marketing Partner’s valuation: 500M SEK.

2. Dynava: still assuming ~300M SEK Sales (lower than current numbers) and a higher Sales multiple of 0.25x due to litigation resolution, resulting in ~75M SEK.

3. Net Cash: 189M SEK

4. Liabilities & Risks:

   1. Litigation settlement: 17M + admin costs 3M = 20M SEK.

   2. Pension Liabilities: 268M SEK.

Equity value calculation: 500M + 75M +189M - 20M - 268M = 476M SEK

Total Equity Value: 476M SEK.

Divided by 728 million shares, we get a Fair Value of 0.65 SEK.

At the current price of ~0.55 SEK, the stock is trading at ~15% discount to its conservative intrinsic value.

Fundamentally, the Margin of Safety has contracted. However, the soft signals are very bullish. Let’s continue.

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The positive signals

New kids in the block [2]

On 23 Feb 2026, it was confirmed that Mats and Eva Qviberg acquired SpectrumOne’s entire stake, becoming a new dominant owner with ~17% of the capital. For those unfamiliar with the Swedish market, Qviberg’s CV fits Eniro’s current situation:

• The Spin-Off experience: When his own investment empire faced a deadlock in 2012, he split Investment AB Öresund in half (creating Creades) to unlock value.

• The restructuring experience: He was involved in the restructuring of Wihlborgs and Fabege.

• The distressed experience: When fashion chain MQ went bankrupt in 2020, Qviberg bought the carcass, cleaned it up, and relaunched it.

The implication is clear: Qviberg didn’t buy Eniro to sit on his hands. He bought it because he sees something he can arbitrage. His entry is the strongest possible signal that the Dynava spin-off is going to happen - plus more good things to come.

New skin in the game [3]

You cannot talk about the new ownership without looking at what the CEO did in the exact same week.

According to the Swedish Financial Supervisory Authority’s (Finansinspektionen) register, CEO Hosni Teque-Omeirat acquired 40 million call options on 21 Feb 2026. Crucially, this was listed as a “Förvärv” (Acquisition), not a “Tilldelning” (Allocation i.e. Stock-based Compensation). He most probably didn’t just receive a free bonus; he reached into his own pocket and paid ~400,000 SEK cash to buy these options from a major shareholder. This is about ~15% of his annual remuneration after tax based on the AGM 2024.

The terms of this bet are likely aggressive. With a price of 0.01 SEK, it can be deducted that either the strike price is likely deep out-of-the-money and/or the expiry date is very close. I am quite skeptical about what this means (as I am with many things). In any case, this still signals a short-term leverage. The CEO is effectively betting his own capital that the share price will re-rate in the short term.

The risks

Despite all the good things, let’s not get too complacent and consider the potential risks.

• From Litigation to Execution Risk: The biggest threat is no longer the litigation. Instead, the risk is pure execution - specifically, whether management can successfully pull off the Dynava spin-off and whether they can ramp up Marketing Partner to realize operational leverage.

• The pension debt: Same risk as described in my original article. Due to the forward-looking nature of this debt, it introduces uncertainty and complexity.

The Verdict

The Q4 report now proves that the litigation risk has been removed, but the full reward hasn’t been priced in yet. The entry of Mats and Eva Qviberg as major owners and the CEO buying massive amount of warrants signal positive things still to come.

The thesis has changed from “Speculative Litigation Bet” to a “Yield-Backed Value Play.” You are being paid handsomely to wait for Dynava spin-off and the final form of the SaaS business.

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

References

[1] https://cdn.bequoted.com/media/1/4cabd222-ef96-4e2d-8748-202e86b95e73/eniro-group-q4-interim-report-2025.pdf

[2] https://www.enirogroup.com/pressmeddelanden/?releaseIdentifier=74CE5A8FC5DB06F8

[3] https://marknadssok.fi.se/Publiceringsklient/sv-SE/Rapportsammanst%C3%A4llning/Index/A003W371-1?s%C3%B6kfunktion=Insyn

Early in February, Moment Group released their Year-End Report for 2025. Not only did the report validate the core pillars of our investment thesis, but the operational performance completely blew past expectations.

Since my first post on Moment Group on 9 January 2026, the share price has risen by ~30%. Is there still an upside? My conservative calculation shows a “floor“ valuation of 200M SEK, which is still ~10% higher than the current market cap of 183M SEK.

Here is the updated investment thesis based on the Q4/FY 2025 financial report.

Disclaimer: I am not a licensed financial advisor. I hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

The Q4 Earnings Blockbuster

The numbers in Moment Group’s Q4 were staggering.

• Net Sales: Jumped to 430M SEK for the quarter (up from 333M SEK in Q4 2024). Full-year net sales landed at 1,085M SEK (compared to 1,068M SEK in 2024).

• EBIT: Reached 125M SEK for the quarter.

• Adjusted EBIT: Even if we strip out the 49M SEK capital gain from the Tickster sale, the underlying operating profit was 76M SEK during the quarter, and 28M SEK for the full year. This is an incredible improvement compared to last year.

For the full year of 2025, adjusted EBIT landed at 28M SEK. If you recall the original thesis, I estimated a realistic adjusted EBIT range of 15-30M SEK for the year. They successfully delivered at the very top end of that range, despite incurring costs to strengthen the business and dealing with a 2-quarter closure of Cirkusbygningen.

Catalyst 1 Materializes: Tickster and Deleveraging

The much-anticipated deleveraging catalyst played out flawlessly, though with a slight twist in which debt the management chose to target first.

• The Tickster Sale: The report confirmed the sale for 62.5M SEK, resulting in a clean 49M SEK capital gain and a 62.5M SEK direct liquidity injection.

• Net Cash Position: Moment Group ended the year with a massive 173M SEK in liquidity (up from 111M SEK in 2024). This makes their balance sheet cleaner (excluding lease liabilities), since their total interest-bearing debt is lower than their total cash.
  Cash - bond debt - deferred tax = 173M - 109M - 23M = 41M SEK in Net Cash.

• The Debt Paydown Twist: While we speculated they might use 50M SEK to pay down the corporate bond, the board instead announced a post-period decision to pay down the remaining COVID deferred taxes (23M SEK). Despite this twist, this is still great news for shareholders.
  Additionally, the massive amount of cash provides them with the flexibility to either pay down the bond debt (up to the 50M SEK allowed with no penalty), or refinance it with lower interest rate.

• No Dividend Policy: Validating our view of management and the board as disciplined capital allocators, the board proposed zero dividends for 2025, opting instead to reinvest liquidity into the core business and clean up the balance sheet.

Setting the Stage for 2026

While Q4 2025 was fantastic, management has also set a strong floor for 2026:

• Cost Savings: Organisational changes and operational efficiency measures implemented during the year are expected to generate annual savings of 8-10M SEK, taking full effect in Q1 2026.

• Reopenings: The iconic Hamburger Börs in Stockholm reopened towards the end of the year, revitalized as a modern live venue operating seven days a week. Cirkusbygningen is also fully operational again after its renovations. This hopefully will add into both their top and bottom line.

• Prepaid Ticket Revenues: A key indicator of future cash flow, prepaid ticket revenues sit at a healthy 118M SEK (up from 114M SEK).

• Strategic Review: Quoting the report, “The Board of Directors of Moment Group has, in consultation with the Group CEO, decided on a strategic shift whereby the focus going forward will be on optimising and developing the existing operations. As a result, the Group’s financial targets are currently under strategic review.” With the current management and board’s proven track record through the massive debt and high interest rates period of the past years, I am somewhat certain that the outcomes of this strategic review will be good for shareholders. Some possible outcomes of this strategic review might be:

  • New deleveraging target.

  • Further portfolio pruning i.e. divestment of low-margin assets.

  • Dividends.

  • M&A activities - which I won’t be too happy about.

Catalyst 2 still in play: Swedish legislative tailwinds

While Catalyst 1 has materialized, Catalyst 2 acts as an organic growth tailwind that requires zero additional effort from the company.

• The “Dance VAT”: Starting 1 July 2026, the VAT on entry fees for dance events - including nightclubs like Moment Group’s Golden Hits and Wallmans - will drop from 25% to 6%. While the effect to the Group as a whole is minimal, this is a free gift for the Wallmans Group segment.
  If a guest pays 200 SEK for entry, Moment Group currently keeps 160 SEK (VAT is added on top of the price). Under the new rules, they keep 188 SEK. This represents a 17.5% increase in revenue per guest with zero increase in costs.

• Reduced Employer Contributions (19–23 Year Olds): In the hospitality and performance sectors, the majority of the workers are young. Starting from April 2026 to September 2027, the Swedish government is introducing a temporary reduction in employer fees for staff aged 19–23, dropping the rate from 31.42% to 10.21%. Although this is temporary, it will increase the Group’s margins and cash flow for the next 18 months.
  If we estimate 100 employees falling into this bracket with 23,000 SEK / month salary, this legislative change could save the company >5M SEK annually in labor costs. Again, this is “free” money that goes straight into the pocket of the shareholders.

• The Household Income Surge: Lastly, 2026 is set to be a year of recovery for the Swedish consumers. Between direct income tax cuts (Jobbskatteavdrag), real wage growth outpacing inflation, and temporary food VAT reductions, the average two-income household is projected to see an increase in disposable income of roughly 5,700 SEK per month. In an experience-based business like Moment Group, this is a macro tailwind. When households have more “fun money,” they book the musicals and go to the dinner shows.

Next, let’s update our valuation.

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The updated valuation

Let’s be honest - if we could, we wouldn’t want to do the hard work of valuing companies. According to Charlie Munger, Warren Buffet never does a DCF. Joel Greenblatt uses formulaic approaches. Ben Graham just did simple math with his Net-Net.

Inspired by these value investing greats, I will also try to be “lazy” and use a common sense approach in updating my Moment Group’s valuation. The point is: if a stock is cheap enough, one should not need Excel to prove it. So, here goes nothing.

The deferred tax is done

Throughout 2023-2025, Moment Group’s core operations successfully covered all venue costs, leases, and interest expense, while ended up mostly break-even in Owner’s Earnings basis. They did this while also routinely draining roughly ~20M SEK per year to pay down their deferred COVID taxes. To be exact: 22M SEK in 2025, 19M SEK in 2023 and 2024.

Now that they have used the Tickster proceeds to wipe out that tax liability entirely, they don’t have to pay it anymore. This means that starting from 2026, this ~20M SEK will flow down their accounting and falls directly on the feet of the shareholders i.e. Free Cash Flow.

The Margin of Safety

What about the 3-5M SEK in annual earnings lost from selling Tickster? What about the 20.6% corporate tax on the new cash from deferred tax? We simply use the newly announced 8-10M SEK in cost savings to offset those extra costs.
What about the bond debt? The massive Net Cash position of 41M SEK shows that the bond debt has become less relevant. Theoretically, we should add this to our valuation, but we will not because we’re trying to be as lazy and conservative as possible.
Ultimately, we treat the cost savings and Net Cash as our “Margin of Safety” - keeping our baseline assumption locked at a clean 20M SEK.

The “lazy” DCF

If an operating business generates 20M SEK in Free Cash Flow (FCF), and we demand a strict 10% rate of return with 0% growth, the value of those operations is practically: FCF / required rate of return = 20M SEK / 0.10 = 200 M SEK.

This means that the implied equity value is 200M SEK. This serves as our new “floor” valuation. With the current market cap at 183M SEK and all the conservative assumptions we take (no cost saving, no net cash, no legislative tailwind, no bond refinancing), there is still at least ~10% of upside for Moment Group.

Do you see how beautiful this lazy valuation is? Do you agree with the assumptions?

The Risks

Things are finally starting to look great for Moment Group. But it is exactly at such moments that one needs to be more aware of the risks involved. While the operational cash flow is being unburdened, an intelligent investor must look for trap doors that could still derail this turnaround.

Sensitivity to Discretionary Spending

Musicals, dinner shows, and nightclubs are the definition of discretionary spending. Even with the 2026 legislative tailwinds, Moment Group is highly sensitive to the consumer’s mood. If inflation returns or unemployment ticks up, the 20M SEK FCF could easily shift to be operational hole plugs.

The prepaid ticket revenues float

Moment Group’s liquidity is heavily supported by 118M SEK in prepaid ticket revenues. This is “free” money from customers, but it is effectively an interest-free loan that must be repaid with performances. If a severe recession hits, or another “black swan” event (like COVID) occurs, or some performances need to be cancelled (buildings breaking down or performers being sick), this money will be used to refund customers, practically wiping out their Net Cash position. No major cancellations are reported for 2026 as of the writing of this article.

Bond debt

While the Net Cash shows that the bond debt becomes less relevant, it still needs to be paid down or at least refinanced. Management has roughly one year to take actions. If the company hits an operational decline in 2026, refinancing this bond could become expensive or difficult. The worst case might be the need of dilutive measure - albeit with low probability.

Insider inactivity

This honestly bugs me the most. While the numbers start to look great, the “elephant in the room” remains: There is no insider activity confirming the turnaround. On the other hand, the strategic review mentioned in the report could be the reason why they remain locked out from trading.

The Verdict

Let’s put this into perspective. As of right now, Moment Group’s total market cap sits at roughly 183M SEK. Our lazy valuation strips out the accounting and puts its “floor“ intrinsic value at 200M SEK. Remember, this calculation is conservative and completely ignores:

• The effects of cost saving measures and Net Cash position.

• The 2026 Swedish legislative tailwinds.

• The fact that management will either pay down the bond debts (up to 50M SEK) or refinance the bonds - leading to lower interest expense in both cases.

In conclusion, I believe that there is still potential upside for Moment Group. But no one knows for sure, read the Disclaimer and do your own due diligence!

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

Date: 09 February 2026 (article released date may differ)
Ticker: AKAST (Euronext Oslo)
Price: ~13.64 NOK (Norwegian krona)
Market Cap: 3.61B NOK

Let’s be honest, the primary reason to own Akastor is not the oil cycle. The reason is actually the price discovery event when – eventually – one of its main assets, HMH, gets its own IPO. Investors have been waiting for years – the IPO was mentioned in 2022 and still has not occurred by early 2026. Due to this delay, the market views Akastor as a holding company stuck in a permanent undervaluation. The stock has drifted sideways as investors waited for HMH’s IPO.

However, a deep dive into SEC filings (submitted 29 January 2026) reveals a hidden signal that only an analytical investor (such as yours truly) is able to find: a structural change in executive compensation that aligns management’s personal wealth with a listing before September 2026. This is also supported by softer evidence: the debt restructuring and the upcoming SPS audit of drilling companies and offshore rigs. Combined with Akastor’s current valuation that is close to the floor valuation, this investment thesis represents an asymmetric, price discovery value play.

Update (10 Feb 2026): this article is written before the Transocean + Valaris merger announcement in 9 February 2026, which may be a headwind for HMH. I peppered in some analysis on this merger in this article, but a closer look may be necessary. The thesis is intact, though the catalysts mentioned may have become softer. Allocate your money wisely to avoid opportunity cost.

With that warning out of the way, let’s get to it.

First of all, what is a price discovery event?

Price Discovery is the mechanism by which a "dead" asset becomes "live." Currently, HMH is a black box valued with a massive "conglomerate discount.” Because HMH is a private joint venture (owned 50/50% by Akastor and Baker Hughes), its true market value is invisible and screened out by institutional capital that requires liquid, public benchmarks. The IPO process breaks this black box open: it forces the market to price HMH independently of the parent company.

The price discovery goes like this:
(These numbers are hypothetical! I estimated the actual numbers further down)

Let’s say that the post-IPO market cap of HMH turns out to be 7.2B NOK, for which 50% - 3.6B NOK - is attributed to Akastor. The current market cap of Akastor (3.61B NOK) is the same as the market value of Akastor’s stake of HMH. What does this mean? This means that the rest of Akastor’s holdings are valued zero by the market… MISPRICING !! This will hopefully push smart money to start flocking into Akastor and prop the share price up. That’s the gist of a Price Discovery Event.

Now let’s take a look at the catalyst signals.

The signals (i.e. why it would happen before September 2026)

1. The strongest signals: The Restricted Stock Units

In an SEC filing dated 29 January 2026, HMH explicitly replaced the cash plans use to compensate the management with Restricted Stock Units (RSUs). One can verify this amendment by looking at the Exhibit 10.25 to 10.31, pp II-4 and II-5 in the submitted document [1].

For comparison, the original filing in August 2024, early 2025 amendment in January, and late 2025 amendment in November do not have such exhibits or sections (you can have a look at all the SEC filings in [1]). For those previous years, HMH executives received “Phantom Awards” - cash bonuses that simulated stock ownership. This is standard for private companies - somewhat a vague way to “simulate” a stock option where the market value of a company is unknown.

With such an amendment submitted to SEC, HMH’s IPO became a legal “ticking clock.” Why this matters?

• The Tax Trap: RSUs trigger an immediate income tax bill upon vesting. In public companies, the general practice is that executives sell some of their given shares to pay for the income tax. If HMH remains private, executives would have no way to sell shares to pay the tax. The company most possibly will have to cover for this, leading to unnecessary cash drain.

• The Date: A major tranche (about 1/3) of these RSUs vests on 1 Sept 2026.

• The Deduction: Management would only agree to this switch if they were somewhat certain that the stock would be liquid (public) by that date. You do not propose executives to swap a “guaranteed cash bonus” (Phantom) for “taxable stock” (RSUs) unless you are certain the stock will be liquid enough to sell on the vesting date. This switch happening now (Jan 2026) - indicates the liquidity event is planned for the immediate future. It acts as a deadline that is far more powerful than any promise or press release.

2. The soft signal #1: Bankruptcy risk is off the table

In December 2025, HMH refinanced its 200M USD bond debt, pushing maturities out to late 2028 from late 2025 [2]. Why this matters?

• Pre-refinance: If HMH had to IPO in 2025 or 2026 to pay off debt, there is a high risk of IPO valuation at a low price. Even worse, an IPO forced by incoming debt maturities may trigger a massive sell-off directly after the IPO.

• Post-refinance: HMH has plenty of cash to run their operations without worry of debt maturities. They can wait for the perfect window for an IPO. This sends a message to the new investors that they will not be buying a distressed company.

In addition, HMH also owes their shareholders (Akastor and Baker Hughes) ~132M USD. This is a debt with 8% interest that compounds in itself i.e. no maturity debt nor payment is transacted, but every year the IPO is delayed, this adds ~11M USD of debt to HMH. This debt will potentially be paid back immediately with the IPO proceeds.

Coming back to the timeline, both the 2028 debt maturity and the high compound interest of the shareholders loan give us soft signals that the IPO is expected in 2026 (or delayed to 2027 at most).

3. The soft signal #2: The capital cycle opportunity

Why is HMH’s financial results so bad in 2025? The Akastor/HMH management gave us the answer for this: Because the drillers paused their maintenance and cannibalized their spare parts inventory in 2025. If you don’t know HMH’s business model (then maybe you should not even be reading this…), they practically have recurring revenue of selling services and spare parts to drillers and offshore rigs.

Why does it matter that drillers paused their maintenance in 2025?

• The Problem: Drillers deferred maintenance and preferred to cannibalize their reserve spare parts, causing HMH’s high-margin revenue to dip in 2025. The scariest thing was in Q3 2025 [3], where their order intake is lower than their revenue. This means that they are “eating their backlog” - they invoiced 217M USD of work but only replaced it with 171M USD of new work, implying that revenue must drop in the future.

• The Opportunity: This is temporary (hopefully, though the numbers for Q4 2025 will probably be bad). Rigs have a 5-year Special Periodic Survey (SPS) cycle. A massive wave of rigs reactivated in 2021 post-COVID should theoretically undergo maintenance in 2026. What is the proof of this?

  The evidence supporting this up-cycle thesis can be extracted from Q3 2025 reports of the titans of the drillers, Valaris and Transocean:

  • Valaris Q3 2025 fleet status report, pp 10-12 [4]: about 14 out of the total 36 contracted fleet have out-of-service periods in 2026 (implying maintenance). This is close to ~40% of their fleet! Compare this to their Q3 2024 status report [6], where only 6 out of their 36 contracted fleet were due for maintenance in 2025. One could assume that 2026 will not be a typical maintenance year for them.

  • Transocean Q3 2025 earnings call [5] mentions that their operating and maintenance expense were below guidance due to deferred maintenance costs. Where is this maintenance cost deferred to? Probably to the next year.

The Deduction: When drillers run out of spare parts in 2026, orders will start coming in to HMH’s financial statement. Having financial statements that show an up-cycle are definitely beneficial for their IPO valuation.

Coming back to the timeline, this again supports the thesis that the IPO should at least happen in 2026. Management would want the IPO valuation to be based on a high-order, top-cycle financials.

Merger risks update (10 Feb 2026): the two companies mentioned (Transocean + Valaris) dared to announce a merger while I am writing this article [7]. Quick comments on that:

• The merger document mentions 200M USD in cost and supply chain “synergies.” Not sure what that means exactly, but I’m sure nothing too good for HMH as their supplier. This amount is close to their annual revenue.

• The merger document also mentions the retiring of some rigs and fleet, which means they do not need any new spare part, thereby reducing HMH’s order intake and revenue.

• I do not expect the maintenance planning for 2026 would change drastically. However, they would have even more spare parts to cannibalize from their combined inventories. This may delay the up-cycle further.

• The combined entity controls about 25-30% of HMH’s total revenue. Having 2 of the biggest customers merging might present a “pricing threat“ to HMH.

• Nothing to do for now, let’s continue with our investment thesis…

The valuation

Let’s look at the numbers. Most of my dear readers (which I do realize are not much at this point unfortunately… please subscribe!) know that I like to take conservative assumptions to find the “Floor.” However, even using conservative numbers that represent HMH at its low-to-mid cycle, Akastor currently trades close to the floor valuation.

We will use two valuation methods to calculate HMH’s intrinsic value.

Multiple-based valuation

• HMH Normalized EBITDA: 132M USD
  This number represents their base year in 2023 and ~25% below the 2024/2025 “bad“ year.

• Multiple: 6x EV/EBITDA
  This is a discount to peers like NOV and Schlumberger, which trade at 7-10x.

• HMH Enterprise Value: 132M x 6 = 792M USD

• HMH Net Debt: ~325M USD (Iicluding 132M USD shareholder loans).

• HMH Total Equity Value is 792M - 325M = 467M USD

• Akastor’s Stake (equity + shareholder loan):

  50% x (467M + 132M) = ~300M USD = 2.8B NOK

• Akastor’s Net Cash: 279M NOK (include subsidiaries’ debts and Odfjell sale)

• Akastor’s intrinsic value: 3.1B NOK (current market cap 3.61B NOK)

• With a slightly less conservative valuation of 150M EBITDA and 7.5x multiple, Akastor’s intrinsic value jumps to 4.7B NOK - a 30% upside!

DCF-based valuation (Owner’s Earnings approximate)

• HMH Normalized EBITDA: 132M USD

  We use the same low EBITDA assumption

• HMH CapEx: 25M USD
  Based on the most recent SEC filing in January 2026 [1], their CapEx is about 2-3% of total revenue, which is crazy low. We use the highest CapEx from their pro forma financials of the last 3-year.

• Tax Rate: 25%

• Base Cash Flow: (132M - 25M) x (1 - 25%) = 80.3M USD

• Discount Rate: 10%

• Terminal Growth: 2% (Gordon Growth Model)
  Long-term inflation i.e. no real market share growth.

• HMH’s DCF Enterprise Value: ~1.0B USD

• HMH Total Equity Value is 1.0B - 325M = 675M USD

• Akastor’s Stake (equity + shareholder loan):

  50% x (675M + 132M) = ~400M USD = 3.7B NOK

• Akastor’s Net Cash: 279M NOK

• Akastor’s intrinsic value: ~4.0B NOK (current market cap 3.61B NOK) - this is already an upside of ~10%!

Conclusion on the valuation

The current market cap of Akastor is closed to the “floor“ valuation with both valuation methods. Remember that this intrinsic value does not take into account any of the other subsidiaries of Akastor, nor its financial assets. With these conservative assumptions, Akastor’s other assets are priced at zero or negative value - which we should treat as the conglomerate discount.
The floor is near!

What is the upside? Well, calculate it yourself. I can’t do everything for you. But I sure hope that it will be surprisingly pleasant. As long as we cover the downside, the upside will take care of itself.

The inverted thesis

How would this investment thesis play out suboptimally. Well, we are not out of options there either:

• Another delayed IPO:

  The merger news update. This merger might actually be the strongest driver of why the IPO is potentially getting more delayed. If market conditions worsen, HMH might delay the IPO until 2027 (waiting for the maintenance up-cycle). During this delay, the 8% PIK interest on shareholder loans continues to compound, transferring equity value from the shareholders to the debt holders.

  However, coming back to the January 2026 SEC filing, an RSU Award Agreement is a binding contract between the company and the individuals. It is not just a press release. Going back from “Real Stock“ to “Phantom Cash“ (whose values are based on a hypothetical sale) is a downgrade in security for the management and board members.

• Profitability of Akastor’s other subsidiaries: Akastor’s other subsidiaries, AKOFS Offshore and DDW Offshore, have historically burned cash. If they require a bailout, Akastor may use the HMH IPO to sell off their shares and plug that hole rather than utilizing their stake on HMH to return money to shareholders via dividends or similar processes.

• The Baker Hughes sell-off: Baker Hughes might want to exit. There is a big likelihood that they will sell their 50% stake of HMH after the IPO, thereby pushing down HMH’s stock price and its apparent market value.

  BONUS: this potential share dump by Baker Hughes might actually present a “second bite“ opportunity. We have calculated the floor value of HMH, so why not use that to our advantage and transfer our investment thesis from Akastor’s price discovery to HMH’s spin-off play.

Knowing all this information, what to do now?

Given the specific timeline we’ve uncovered, your strategy is honestly up to you. I am not going to advise you (read the disclaimer below!). But let’s go through the timeline anyway and look at the potential entry points.

• Buy now?

  Akastor reports Q4 2025 results on Thursday, 12 Feb 2026. These numbers will be ugly. On the other hand, there is a tiny little change that they might announce the exact timeline of the IPO, which will lead to the share price going up.
  Buy before the earnings report and risk losing your initial money, or buy after the earnings report and risk not being on the train during the initial upside.

  In any case, I think it is important to pay attention to any mention of customers’ “inventory normalization” or “SPS survey for 2026.” This will be the green light for HMH’s IPO in 2026. On the other hand, if they mention ”merger-related order pause,” I honestly don’t know what to say…

• Pre-IPO announcement (Q1/Q2 2026)

  The company will be “quiet” as they need to finalize the audited financials for the SEC and final IPO valuation. During this period, we need to keep our eyes peeled for any additional “Amendments” to the S-1 filing. This usually precedes the actual IPO by 2-3 weeks. Remember, the RSUs vest on 1 Sept 2026. For an IPO to happen comfortably before then, the filings need to be submitted late Q2 or early Q3 2026.

  If Akastor’s share price drops after the Q4 2025 reporting (and maybe after Q1 2026 as well), while no IPO-disproving amendments are filed to the SEC - this period might be the best time to buy (assuming you do your own due diligence, of course!).

• The IPO Announcement

  When the IPO price range is officially announced, Akastor’s stock will likely jump as the market finally performs the “Price Discovery” we calculated. As a result, now it is definitely too late to buy Akastor’s shares, since we retail investors would not be faster than institutional investors at this stage. In other words, by this time - when institutional investors start coming in - we should actually sell… or not, depending on your strategy. Who knows, there might be some other benefit or long-term special situation occurring with Akastor.

• The “Baker Hughes Dump”

  After the IPO, HMH’s share price might struggle for 3–6 months because Baker Hughes would sell their 50% stake. After Baker Hughes finishes selling, that is the period where we should come for our “second bite.” Though we certainly need to make sure that we buy close to the floor valuation or with enough margin of safety. A falling stock price does not always mean that it is time to buy.

Will this actually play out as smoothly as my narratives here? I don’t know. No one knows. The merger is definitely worrying. Do your own diligence and be safe out there!

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

References

[1] https://www.sec.gov/edgar/browse/?CIK=2021880&owner=exclude

[2] https://hmhw.com/archives/3509/hmh-holding-b-v-successful-placement-of-a-senior-secured-bond-issue-2/

[3] https://www.investing.com/news/transcripts/earnings-call-transcript-akastor-asa-q3-2025-shows-strong-cash-flow-93CH-4320763

[4] https://s23.q4cdn.com/956522167/files/doc_downloads/2025/10/10232025-Fleet-Status-Report_FINAL.pdf

[5] https://finance.yahoo.com/news/transocean-ltd-rig-q3-2025-203529106.html

[6] https://s23.q4cdn.com/956522167/files/doc_financials/2024/q3/10302024-Fleet-Status-Report_FINAL.pdf

[7] https://investor.deepwater.com/news-releases/news-release-details/transocean-acquire-valaris

To make things even simpler, we will focus only on Catalyst 1 that is fast approaching (Q4 2025 earnings report in 6 February 2026).

Let’s get straight to it!

The problem?

From their Q3 2025 report, Moment Group is heading into 2026 carrying several types of debts.

• 109M SEK senior secured bond. This bond likely carried a coupon in the ~8.75% range (STIBOR 3-MONTH + 6.75%) - costing them ~9.5M in annual interest expense.

• COVID deferred tax (23M SEK). They have paid ~22M SEK in 2025 and are expected to pay down everything by August 2027.

• Lease liabilities (461M SEK) are tight more to their operational cost. We should not take this into account.

Moment Group is a cash flow machine - if not for the debt. Just to service the bonds and deferred tax costs, one can infer that they have at least the ability to generate an EBIT of 31.5M in 2025 (22M + 9.5M SEK).

Catalyst 1: Deleveraging through Tickster sale

In late 2025, Moment Group sold its minority stake in Tickster AB for 62.5 million SEK. While the headlines may draw your focus on the cash injection, the real value is in what they do with that cash. (Or at least what I hope they would do)

Think of it like this:

• Tickster’s stake: This investment was paying the company a “yield” of roughly 6.4% (about 3-5M SEK in earnings per year based on FY 2023 and 2024).

• The bond: At the same time, Moment Group had a 109M bond loan costing them roughly 8.75% in interest every year (~9.5M SEK).

• The Strategy: The company sold the low-yielding asset (6.4%) to pay off the high-cost debt (8.75%).

Now the question is: how much of the bonds can / will they pay down?

Let’s look at the bond amendment and conditions from 16 July 2024, clause 11.4 “Voluntary partial redemption (call option)“ [1]. It is stated that the issuer (Moment Group) may redeem up to 50M SEK of the outstanding bonds without any penalty fee. What is interesting is that in another document on this new agreement [2], it is stated that “The following new clause 11.4 shall be added to section 11…“, which implies that the redemption clause did not exist in the previous agreement.

So, we can assume that they may use 50 million SEK of the sale proceeds to pay down the bond. The math then goes:

1. Income Lost: They lose the 3-4 million SEK that Tickster was earning.

2. Expense Saved: They save 4.35 million SEK in interest payments (8.75% on 50M).

Moment Group did not only improve their balance sheet; they actually slightly increase their annual earnings. Plus the fact that interest-bearing debt (and ratio) goes down and equity value increases, all through an asset sale.

The current EV (as of 1 Feb 2026, excluding leases) is ~200M, while paying the debt down by 50M SEK with the Tickster proceeds will push their EV closer to ~150M - this is almost as if they do not have any debt. The other numbers and ratios (assuming they pay down 50M of the bonds) are discussed in detail in my original article.

Now imagine if with a healthier balance sheet, they can refinance the rest of the 59M SEK bonds i.e. from 3M STIBOR + 6.75% into 3M STIBOR (about ~2% now). This means that they would theoretically save another ~4M SEK annually.

Moment Group applied skillfully the principle of “money today worth more than money tomorrow” by selling their Tickster stake.

Could I be wrong?

No doubt I could! That is why I want you to come along with me in my investing journey - to criticize me and tell me where I could be wrong!

Some risks this catalyst may not materialized in a positive way:

• Management does not pay down the debt. Difficult to believe with Gelba and Robus Capital (through BNP Paribas) in the steering wheel - an investor and a hedge fund with history in turnarounds, respectively. I think this is the least risk to be worried about.

• It is entirely possible that they may pay down some of the bonds, not the max 50M SEK allowed redemption. Though this is still a good thing, the benefit of lowered interest expense may not outweigh the income from Tickster.

• Q4 2025 was a disaster. In this scenario, the sale proceeds is used simply to plug a hole in operational liquidity. If this is the case, the entire thesis collapses and investors could potentially lose their money in the near future.

• The scariest thing: there is no insider activity after the Tickster sale. This may be due to the asset sale being finalized in the Christmas / New Year vacation period and they entered the “quiet period“ directly after. Or it might be that there is no conviction from the board and the management…

Conclusion

This investment is a risky business, that is certain - so allocate your assets appropriately. There are 2 things to pay attention to in the next earnings reporting:

• How much debt they will pay down with the Tickster sale proceeds.

• Whether the board and management purchase shares after the reporting.

Your decisions based on the information presented here are at your own discretion.

I will revisit Moment Group once their Q4 2025 earnings is released. So stay tune!

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

References

[1] https://momentgroup.com/wp-content/uploads/2026/01/Moment-Group-Bond-Amended-and-restated-terms-and-conditions-vers-16-July-2025.pdf

[2] https://momentgroup.com/wp-content/uploads/2025/06/Moment-Group-AB-publ-Notice-of-written-procedure_June-2025.pdf

Fortunately, the legendary investor Joel Greenblatt has talked quite a bit about how corporate shake-up often hides significant market inefficiencies and highest returns. In this article, we are going to analyze Stora Enso’s plan of spinning-off its Swedish forest assets (ForestCo) from the industrial segments (RemainCo). Ultimately, I am going to show you how this Stora Enso story may mirror some of the study cases Greenblatt has written in his book.

(apologies for using similar intro to my previous article on assessing asset sales.. check that article out if you are interested! I analyzed Elkem’s divestment there)

Case Study: Stora Enso

(numbers are taken as of 25 January 2026)

Stora Enso intends to separate their Swedish forest assets business into a new publicly listed company. It will be Europe’s largest public pure play forest company, comprising over 1.2 million hectares of forest land in Sweden with a fair value of approximately 5.7B euro [1].

The opportunity?

In September 2025, Stora Enso sold 12.4% of its Swedish forest holdings for 900M euro [2]. This means that the implied market value of the remaining 87.6% Swedish forest holdings that are going to be spun-off is 6.36B euro instead of the fair value of 5.7B euro.

Why the over-priced buy? My guess: wind power. Stora Enso has identified a huge potential for 20 TWh wind power on its land, based on a presentation in June 2024 [3]. Swedish wind power generation in 2022 is about 33 TWh, according to Wikipedia. So this is huge!! Though this is only 12.4% of the total 20 TWh potential. One of the buyers, Soya Group, has built a self-sufficient residential properties (for 8,000+ tenants) in Stockholm through its wind farm [4]. In addition, Stora Enso still retains 15% ownership, secures wood availability from the area, and will manage the forest-related service. So, everyone wins I suppose!

In any case, with the remaining Swedish forest assets of 6.36B euro, this implies that the value of the rest of the segments (RemainCo) is 1. 88B euro (8.24B market cap – 6.36B ForestCo). The RemainCo includes:

• Packaging materials: global leader in circular packaging providing premium packaging boards, made from virgin and recycled fiber (in line with EU packaging legislation)

• Packaging solutions: packaging converter that produces premium fiber-based packaging products for leading brands across retail, e-commerce and industrial applications

• Biomaterials: pulp products, aiming to create innovative bio-based solutions that replace fossil-based and other non-renewable materials

• Wood products/sawmills: Europe’s leading provided of sustainable wood-based solutions for building sector.

• Finnish forest assets: valued at 0.9B euro (6.6B euro of total owned forest assets - 5.7B euro of Swedish forest assets, from Q3 2025 report pp 19 [5])

  NOTE: If we take this into account, the implied value of the rest of the segment is even lower i.e. 1.88B euro – 0.9B euro = 0.98B euro! But we will not take this into account to be conservative.

• Others: basically just costs i.e. Group’s shared services, administration and shareholding of partly-owned companies

The valuation for the RemainCo?

Looking at P/S (market cap / revenue) of similar companies i.e. industrial wood + sawmill + packaging solution companies with/without forest assets:

• Stora Enso’s historical: 1.0x

• Amcor PLC (packaging, no forest assets): 1-1.2x

• Mondi PLC (packaging, with forest assets): 0.6-1.4

• Billerud AB (packaging, with forest assets): 0.6-1.2x

• SCA (industrial wood, with forest assets): 4.0-5.5x

Using P/S of 0.6-1.2x, the implied Market Cap of RemainCo should be about 3.72B to 7.44B euro - which is far away from the 1.88B euro calculated before. This is a potential of 200%-400% upside!

Now let’s look at multiple that takes into account the debt - EV/EBITDA.
In order to calculate RemainCo’s EV, we need to calculate its Net Debt:

• Q3 2025 report states that their net debt is 3.2B euro with cash & cash equivalents of 2.2B euro. This implies total debt of 5.4B euro.

• Thankfully, Stora Enso has a specific report dedicated to their debt structure, which consists mostly of green bond [6]. From this report in pp 2, 82% of 2.43B euro is allocated to “sustainable forest management“, amounting to ~2B euro. This “forest“ bond can only be tied to their forest assets, thus ForestCo’s total debt is 2B euro.

• From this information, it can be assumed conservatively that if the RemainCo takes the rest of the debt 3.4B, this amounts to about 63% of their total debt. Assuming same percentage for net debt, this implies that RemainCo’s net debt to be ~2.0B euro.

• RemainCo’s EV: market cap + net debt = 1.88B + 2.0B euro = 3.88B euro

Let’s look at a reasonable EV/EBITDA for RemainCo:

• Stora Enso’s historical: 6-15x

• Amcor PLC: 10-14x

• Mondi PLC: 5-10x

• Billerud AB: 5-15x

• SCA: 12-15x

Using EV/EBITDA of 6-10x, the implied EV of RemainCo should be about 4.29B to 7.88B euro - again quite a bit away from the EV of 3.88B euro. This is a potential upside of 10-200%!

Some points to consider:

• The implied 1.88B market cap and 3.88B EV assume that the income from their Finnish forest asset to be negligible. This makes the estimation conservative.

• Stora Enso’s numbers are affected heavily by the investment ramp-up in the Oulu packaging board line (about 1.1B euro in 2025, Q3 2025 report pp 3). Their EBITDA and EBIT are realistically higher when the ramp-up is finished. This makes the estimation conservative.

• Stora Enso’s interest-bearing debt is not only green bonds. They also have pension liabilities, deferred tax and other liabilities that amount to about ~3.0B euro (5.4B euro total debt - 2.43B euro green bond). This would realistically be distributed proportionally to ForestCo and RemainCo. Thus, the assumption of RemainCo taking all the non-forest bond debt also makes the estimation conservative.

• The relevant economic sector cycles for Stora Enso e.g. constructions, premium packaging in Europe and the Nordics are currently bottoming. This makes the estimation conservative.

• Related to above, timber price is at multi-year low levels due to low construction and packaging demand. Thus, it is possible that the low volume demand is balanced out by the low timber prices. This makes the estimation NOT conservative.

ForestCo - albeit the boring business - is the “good“ business in this spin-off in my opinion. It provides stable and bond-like earnings. If demand is low, they just let the trees grow to be harvested when demand comes back again.
RemainCo is the “bad“ business in this case due to cyclicality (a price-taker of a commodity i.e. timber) and execution risk.

Insiders?

The largest shareholders are Solidium Oy (Finish State) and FAM AB (the Wallenberg family, largest owner of Investor AB), with about 10-11% ownership each. This unfortunately does not mean anything for the spin-off.

However, some interesting things are announced in their remuneration plans [7, 8] and AGM 2026 proposal [9]:

• The annual remuneration for the members of the Board of Directors is to be paid in Company shares and cash. Board members must use 40% of their fixed annual fees to purchase Stora Enso R shares within two weeks after the Q1 2026 interim report (i.e. in Q2 2026). This also occurred in 2025 without any subsequent massive insider selling. This “forced conviction“ might be a way to low-key conduct insider buys at depressed valuation without alerting the general public, which might be a stretch yes, I’m well aware - though the largest shareholders are practically part of the board members, so the people who wrote the mandate are the people who have to follow it. Go figure.

• The Group CEO Hans Sohlström remains with the "RemainCo," incentivized by a stock-based remuneration package that locks his wealth into the RemainCo’s turnaround (Earnings Per Share and Total Shareholder Return targets) through 2028. Important to note that he is an experienced turnaround expert (Ahlström Capital, Rettig Group).

• Additionally, in the 2024 remuneration report it is stated that “Stora Enso recommends and expects the CEO and other Group Leadership Team members to hold Stora Enso shares at a value corresponding to at least one annual base salary“ - which I think is both Finnish and Swedish ways of saying that they MUST hold shares with a nominal value of 1x of their annual base salary.

The risk?

• Commodity cycle risk. Post spin-off, if timber stock supply contracts and timber prices start to increase, the ForestCo will have increased margins, while the RemainCo segment will have decreased margins due to increased input costs. This is a huge threat for the RemainCo’s margins. Nevertheless, the collaboration between ForestCo and RemainCo is supposed to continue decades after the spin-off.

• Interest expense risk. If the RemainCo actually gets a low Market Cap valuation and the 2.0B net debt as in our calculation, this may lower RemainCo’s credit rating, leading to higher interest expense and a risk that a big part of the cash flow will be used to serve debt interests. If low demand continues while interest expense stays high, the possibility of a bankruptcy or a massive rights issue is there.

• “Green” packaging legislation. The EU regulations on packaging [10] may disrupt the paper and plastics packaging industries. This is a real risk for RemainCo, since the packaging segment contributes the most cash flow.

Similarity to Joel Greenblatt’s study cases

Stora Enso’s spin-off situation somewhat parallels some study cases written in Joel Greenblatt’s “You Can be a Stock Market Genius”. It combines the Sears’s valuation arbitrage and the Marriott’s management alignment.

1. The Sears Parallel: arbitraging partial spin-off to analyze mispricing

• In the early 1990s, Sears was a giant, unloved conglomerate. It owned a massive retail and other businesses, but also valuable assets: Dean Witter (brokerage) and Allstate (insurance).

• Partial spin-off: Sears sold 20% of Allstate to the public (an IPO) and spun off Dean Witter. By analyzing the market value of Sears’ stake in Allstate + Dean Witter spin-off, one may infer that the Sears’s RemainCo was valued far too cheap when compared to its market cap.
  (I will not go into the numbers here, but you get the concept. Buy the book if you want to know the details, you cheapskate!)

• The Stora Enso Parallel: the partial sale of the forest asset sets a clear market price for the ForestCo. The RemainCo’s value can then be inferred and it is evidently (or arguably) clear that it is currently valued far too cheap compared to its market cap.

2. The Marriott Parallel: the captain is heading the “bad“ ship

• In 1993, Marriott was splitting into two:

  1. Marriott International (The “Good” Co): The asset-light, high-margin management company (the brand).

  2. Host Marriott (The “Bad” Co): The debt-laden, asset-heavy real estate company (the hotels themselves).

• The captain: the key architect of the spin-off - Stephen Bollenbach - stays with the “Bad” Co Host Marriott.
  The outcome: four months after the spin-off, Host Marriott nearly tripled.
  Insiders’ stake: the Marriott family still owned 25% of the “Bad“ Co after the spin-off, assuring that Host Marriott’s success was still in their personal interests.

• The Stora Enso Parallel:

  • The “Good” Co: “ForestCo” (stable, bond-like).

  • The “Bad” Co: the industrial “RemainCo” (cyclical, execution risk).

  • The captain: Hans Sohlström (CEO) is staying with RemainCo. He is not taking the easy job running the forest bond-proxy. His long-term incentives are tied to increasing EPS and TSR.

    Insiders’ stake: the board - whose members practically are representatives of the largest shareholders - is structurally committed to buying shares in the open market in Q2 2025 and Q2 2026 as 40% of their total annual remuneration.

So, what to do now with Stora Enso?

Well, this article is not an investment advice… so do your own due diligence!
(Read the disclaimer below!)

My personal view: I believe there will be several entry points to exploit this potential mispricing. Depending on what we see during these entry points, one can either aggressively buy, do nothing, or sell completely if one already hold some shares. You should decide for yourself regarding your own actions, but here are the entry points:

• Now: no other supporting evidence except the assumptions yours truly just wrote… do not forget that I also mentioned the risks!

• Q1/Q2 2026: restated spin-off plan and potentially official pro-forma numbers. Pay attention to the total debt distributed to RemainCo.

• Q2/Q3 2026: board purchases as mandated. Whether they keep their shares may be a good input for external investors.

• H1 2027: watch for the potential spin-off dips.

Now I wonder if I should just keep this investment thesis to myself… Anyway, any feedback and comments are appreciated. Please subscribe and be safe out there!

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

References

[1] https://www.storaenso.com/en/newsroom/regulatory-and-investor-releases/2025/11/stora-enso-completes-strategic-review-and-intends-to-create-the-largest-listed-pure-play-forest-company-in-europe-inside-information

[2] https://www.storaenso.com/en/newsroom/regulatory-and-investor-releases/2025/5/stora-enso-divests-12-4-of-its-swedish-forest-holdings-for-an-enterprise-value-of-eur-900-million-inside-information

[3] https://www.storaenso.com/-/media/documents/download-center/documents/investor-relations/2024/forest-field-trip-presentation_3.pdf

[4] https://www.soyagroup.com/en/real-estate/wind-power-for-8000-tenants/

[5] Stora Enso Q3 2025 financial report: https://www.storaenso.com/-/media/documents/download-center/documents/interim-reports/2025/storaenso_results_q325_eng.pdf

[6] https://www.storaenso.com/-/media/documents/download-center/documents/investor-relations/2024/se_green-bond-report-2024.pdf

[7] https://www.storaenso.com/-/media/documents/download-center/documents/annual-reports/2024/storaenso_remuneration_2024.pdf

[8] https://www.storaenso.com/en/investors/governance/remuneration

[9] https://www.storaenso.com/en/newsroom/regulatory-and-investor-releases/2026/1/proposals-of-the-shareholders-nomination-board-to-stora-enso-oyjs-annual-general-meeting-2026#:~:text=The%20shares%20will%20be%20purchased,the%20purchase%20of%20Company%20shares.

[10] https://www.ecosistant.eu/en/eu-packaging-regulation-e-commerce/

Date: 18 January 2026 (article’s released date may differ)
Ticker: ENRO (Nasdaq Stockholm)
Price: ~0.368 sek (Swedish krona)
Market Cap: 278.32M sek (micro cap)

TL; DR

Legacy business segments, undecided litigation case, and history of share dilutions hide the profitable SaaS segment plus a hidden asset ready to be spun off. Eniro provides an asymmetric bet, where the “floor“ is near according to the most likely scenario, and the upside has a wide range of potential outcomes. A turnaround play that has shown some proof.

• Valuation: Trading slightly above its conservative “Floor” value (~259M SEK).

• Upside: 150–200% potential if the litigation ends as expected and the Dynava spin-off is valued more than my conservative assumption.

• Consistent, slightly growing positive cash flow since 2020.

• Healthy balance sheet with a foot note i.e. the pension liability.

• Solid net cash position (152M SEK) protects monetary ruling of the litigation.

The Catalysts

1. Litigation End (Q1 2026): Supreme Court decision on the 43M SEK claim. If resolved without total disaster, the uncertainty vanishes.

2. Dynava Spin-off (Q3-Q4 2026): Separating the less profitable segment to unlock shareholder value.

The Risks

• Litigation: A “worst-case” legal loss could force another massive rights issue.

• Pension liability: a complex 279M SEK pension liability sits on the balance sheet and may fluctuate depending on interest rates and market conditions.

You want to read the details? Then let’s get straight to it!

The business

Eniro Group AB is a Nordic marketing company that has undergone a digital transformation from a legacy publisher of printed “Yellow Pages” into a modern Software-as-a-Service (SaaS) and digital marketing partner for small and medium-sized enterprises (SMEs).

FY 2024’s group results are: revenue 961M SEK, EBITDA 143M SEK, operating profit 72M SEK, net income 68M SEK. The group operates through two primary business segments.

• Marketing Partner offers small and medium-sized enterprises a full range of digital marketing services using both external partnerships and its own local search engines - historically contributes to 60-65% of revenue.

  • Revenue 581M SEK

  • EBITDA 143M SEK

  • Operating profit 93M SEK

• Dynava offers call center and answering services for major companies in the Nordic region, as well as directory assistance services - historically contributes to 35-40% of revenue.

  • Revenue 370M SEK

  • EBITDA 15M SEK

  • Operating profit -6M SEK

• Key strategic context

  • The Azerion Partnership [1]: In 2024, Eniro entered a deep strategic collaboration with Azerion Group N.V. (a Dutch media giant, Eniro’s biggest shareholder since April 2024). Azerion now manages Eniro’s ad-tech and cloud infrastructure, aiming to save Eniro SEK 50M annually in costs while boosting ad revenue. Eniro is effectively becoming a “Sales Front-end“ for Azerion’s “Tech Back-end“.

  • The SME Focus: Eniro targets micro and small businesses (1–50 employees) who need a hands-on partner to manage their local visibility. The marketing Partner segment is increasingly driven by annual recurring revenue (ARR).

  • As of early 2025, the Board has been evaluating a separate listing or spin-off of Dynava to unlock shareholder value and allow it to operate as an independent customer care specialist.

The problem?

• Digital disruption: The legacy business (print and voice directories) has been disrupted, leaving the company in a painful multi-year transition to digital-driven services that depressed the share price. This part of the business has effectively evaporated now.

• Litigation (The Kapatens Case) [2]: Eniro is in a legal dispute with Kapatens Investment AB regarding the 2022 redemption of preference shares. The monetary claim is about 43M SEK.

  • Status: Eniro lost the appeal in the District Court in June 2024 and in the Court of Appeal April 2025. They have now applied for leave to appeal to the Supreme Court (Högsta domstolen).

  • Impact: this is a bit complicated… there is several scenarios to take into account here, so we will cover it in the section “The Floor“ more extensively. Redeye mentions that Eniro has a 100M liability insurance that may (or may not) be used to cover the claim [2].

• Dilution & Trust: The company has a history of massive dilution (recapitalization in 2020) wiping out previous shareholders. This keeps the valuation multiple compressed despite improved operations, and also why we are here!

Lynch category

A turnaround.

Fast-Change or Slow-Change industry?

• Fast-Change in the Marketing Partner segment.

• Slow/Moderate-Change in Dynava.

What is the Moat?

Its historical moat has completely evaporated (the “yellow pages“ monopoly), but Eniro still has a moat in the form of existing relationships with 45,000+ SME customers in the Nordics. This is shown by the increase ARR of about ~5% YoY over the past 2 years. Nevertheless, Eniro has a narrow moat due to low switching cost in digital marketing agencies and/or tools.

You should think of Eniro as a turnaround play and scale your expectation and investment appropriately.

Can a “dummy” run this business?

NO. This is still a complex turnaround play, but with proofs that they are approaching the light at the end of the tunnel. It requires ruthless cost-cutting to prepare the Dynava spin-off, as well as turning Marketing Partner to highly-effective digital marketing and service solutions.

Skin in the Game?

• Azerion Group N.V.: ~25.5% capital. A strategic partner and largest owner, with strategic business alignment as mentioned in the introduction. Azerion acquired Eniro shares in April 2024 at implied price of 0.90 SEK / share, almost 2.5x the current prince.

• SpectrumOne AB: ~12.6% capital.

• Management and board members: CEO Hosni Teque-Omeirat is closely connected to SpectrumOne AB as the third largest owner and its former CEO. Most of the board members are the largest owners of Eniro.

Good capital allocators?

The management reinstated a dividend in 2024 (SEK 0.04/share) and decided to cancel it in face of the potential monetary effect of the Kapatans litigation, which I personally think is an example of a good capital allocation. Although the botched preference share redemption itself was definitely a capital allocation error that incurred unnecessary legal costs…

The integrity and track record

The current CEO, Hosni Teque-Omeirat, is credited with stabilizing the ship after the 2020 crisis, delivering the “best EBITDA in 6 years” (Q3 2024). He previously was the CEO of SpectrumOne AB (the second largest shareholder), and became Eniro’s CEO in 2020 getting his hands dirty, cut costs and fixes the balance sheet. The board has been professionalized with members from Azerion (strategic alignment).

In the end of 2024, the then-CFO Joel Odland left Eniro [3]. A CFO leaving in the middle of a turnaround may signal red flags, though further search did not reveal any real red flags. In total, they have gone through 3 CFOs in the past 12 months, including an interim and the current one.

Is the Balance Sheet a Fortress?

Solid (after the restructuring). Net cash position 152M SEK against effectively zero traditional debt, with a footnote… Eniro has pension liabilities of 279M SEK in their Balance Sheet, which brings the net debt to be 127M SEK (net debt instead of net cash).

But what is this?

• This is the occupational pension (tjänstepension) that they are required to pay for their employer. Eniro choose to keep the pension as cash to fund operations, growth or invest the money themselves, which was an outdated practice. Swedish companies nowadays prefer to pay a pension insurer (e.g. Alecta) to manage it for them.

• In Eniro, the actual pension money is managed via a pension foundation and endowment insurance, so they are real assets, real money. What they owe their employees is subtracted by this, resulting in 279M SEK debt. This is basically the net amount that they owe their employees.

• However, this is forward-looking and the amount is discounted to present value. The net amount in their balance sheet may fluctuate wildly depending on the value of their assets and interest rate. In order to have an insurer like Alecta managing this pension, they need to have enough cash to give to Alecta based on the current present value.

• An example of the fluctuation can be seen in their payments for this pension liability:

  • Q3 2025 cost: -6M SEK (annualized to -24M SEK)

  • FY 2024 cost: -8M SEK (the total annual payment for 2024)

• We will take the official number from their Q3 2025 as their total debt: 279M SEK.

Quality of cash flow

• Positive free cash flow FY 2024 , a massive improvement from negative territory in previous years.

• It is becoming more predictable as they shift to subscription (ARR) models in the Marketing Partner segment.

The floor

There are several scenarios for the floor value of Eniro, depending on the litigation outcome:

Scenario 1 (most likely):

• Eniro lost the monetary ruling of 43M SEK, and the liability insurance does not kick in.

• Cost: 43M SEK (claim) + 6M SEK legal fee = 49M SEK

• Although certainly uncomfortable, Eniro can afford this with the 153M cash.

Scenario 2 (best case):

• Eniro lost the monetary ruling of 43M SEK, and the liability insurance kicks in.

• Cost: 6M SEK legal fee

• This is peanuts in comparison

Scenario 3 (worst case, unlikely):

• It can be assumed that most of the preference shareholders accepted the 2022 exchange offer. Usually, shareholders who accept an offer and do not sue within the strict statutory deadline (3 months from the meeting) lose their right to challenge the decision. The 43M claim by Kapatens is potentially only from the shareholders they represent.

• A worst case could be that the Supreme Court decided to force Eniro to reverse the transaction for everyone.

• This would most probably trigger another rights issue and wipe out the existing shareholders. In other word, be prepared to lose all your money.

Let’s now do some intrinsic value calculation

We calculate the intrinsic value by summing the parts and subtracting liabilities.

1. Marketing Partner (DCF)

• Assumptions: zero growth year 1-10 (conservative growth, actual ARR segment growth is about +5% YoY the past 2 years), exit multiple of 10x

• Owner’s Earnings (Cash Flow from Ops - Maintenance CapEx).

  • CFO (LTM): ~SEK 100M (conservative estimate. Group’s CFO is 109M and 110M SEK from FY 2024 and TTM Q3 2025, respectively - assuming Dynava’s CFO is just slightly positive).

  • Maintenance CapEx: 50M SEK (conservative, D&A from FY 2024 and TTM Q3 2025. Actual maintenance CapEx potentially around ~20M SEK).

  • Owner’s Earnings: SEK 50M.

• Required rate of return: 15% (accounting for Margin of Safety)

• Marketing Partner’s valuation = ~375M SEK

2. Dynava Segment (EV/Sales)

• Sales: ~300M SEK (conservative estimate, actually 370M and 334M SEK from FY 2024 and TTM Q3 2025, respectively)

• Multiple: 0.2x EV/Sales (conservative multiple for low margin, human-intensive business that is barely profitable)

• Dynava’s valuation: ~60M SEK

3. Cash & Assets

• Net Cash: 152M SEK.

4. Liabilities & Risks

• Pension Liability: -SEK 279 Million (based on Q3 2025).

• Litigation/Fines: -SEK 49 Million (most likely litigation result).

Equity value calculation: (375+60+152)−(279+49)= 259M SEK

The realistic “Floor Valuation” is then 259M SEK.

• Current Market Cap: ~SEK 275 Million.

• Even with these conservative assumptions, the stock is currently trading effectively at or slightly above its realistic “floor” value, pricing in zero growth, most likely litigation payment and full pension repayment.

If everything goes just slightly better:

• 2.5% growth of Marketing Partner year 1-10 instead of 0: 435M SEK

• 0.5x sales for Dynava spin-off instead of 0.2x: 150M SEK

• Liability insurance kicks in for the litigation case: -6M SEK

• (435+150+152)-(279+6) = 452M SEK

The potential “Northside“ is then 452M SEK (160% upside!)

Bonus valuation The current CEO Hosni Teque-Omeirat came “down” from SpectrumOne AB to clean Eniro up. This might be a preparation for a potential sale to Azerion. It is not entirely unlikely that a take-over may happen after the litigation is decided and Dynava is spun off (it does not fit in Azerion’s business model). The offer price naturally depends on the litigation outcomes and Dynava spin-off, but knowing that Azerion have bought shares at 0.9 SEK, this could turn out positive for current shareholders. This will be 217% upside, though it is doubtful that Azerion would buy Eniro out with such a premium. A premium of 30% of market price is more reasonable.

The Catalyst: Why Now?

From the long narrative above, we then have 2 major catalysts happening some time soon:

1. The End of the Litigation

   • Eniro has applied for leave to appeal to the Supreme Court likely in April/May 2025. The previous decision came in ~9 months (July 2023 - April 2024). Thus, the decision for the leave to appeal is most probably in Q1 2026.

   • If Eniro’s leave is denied, we will be in the base or worst case scenario.
     If the leave is granted, we may need to wait for another 12-18 months i.e. Q2-Q3 2027. The share price would potentially languish during this time as well.

2. The Dynava spin-off

   • Carlsquare is mandated to prepare the proposal in Q1 2025 [4].

   • Cost-cutting and cleaning-up is currently happening.

   • The official announcement will potentially be in the AGM Q2 2026, with the execution in Q3-Q4 2026

Conclusion

Why buy? Asymmetric risk/reward with a definite timeline
(This is not a financial advice, read the disclaimer below!)

• Margin of Safety: Downside is realistically protected by the cash pile and profitable operations (unless the “very unlikely“ legal scenario actually happens). Conservative Value (DCF + Assets): ~259M SEK. The stock is trading close to its conservative intrinsic value, assuming the litigation is contained to the 43M claim.
  Though probability of a wipe-out is not non-existent.

• Upside may be realized from a neutral end to the Kapatens litigation and a successful spin-off of Dynava - 150-200% upside.

• Timeline varies from Q1 2026 for litigation and Q3-Q4 for Dynava spin-off.

This discount is not irrational, since there are actual reasons for it:

• Litigation: The Kapatens case creates uncertainty. Most investors and institutional money does not like uncertainty.
  NOTE: the worst case of the litigation scenario - although unlikely - may practically bankrupt Eniro.

• The pension debt: Same as above, due to the forward-looking nature of this debt, it introduces uncertainty and complexity. However, even accounting for this debt, our conservative calculations show that the “floor“ valuation is still above the current market cap.

• Share dilution history: A massive bomb (99% dilution) in 2020 effectively wiped out existing shareholders, which did not really demonstrate confidence to their shareholders.

What do you think? Do you think the calculations make sense?
Do you dare to invest in Eniro considering the asymmetric risk/reward? Be mindful about your allocation if you do!

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in “The Northside” is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

References

[1] https://www.enirogroup.com/pressmeddelanden/?releaseIdentifier=7E356B4F051D4298

[2] https://www.redeye.se/research/921089/eniro-kapatens-law-suit-act-2

[3] https://www.enirogroup.com/pressmeddelanden/?releaseIdentifier=9546C00A4898E362

[4] https://www.inderes.se/releases/eniro-group-eniro-utvarderar-sarnotering-av-dynava-och-ger-carlsquare-i-uppdrag-att-ta-fram-forslag-pa-tillvagagangssatt

Date: 9 January 2026
Ticker: MOMENT (Nasdaq Stockholm)
Price: ~5.58 sek (Swedish krona)
Market Cap: ~140.7 M sek (micro cap)

TL;DR

• Moment Group is a Swedish experience industry company currently undergoing a turnaround. They do musicals, shows, etc and own restaurants, dance clubs, bowling place, etc.

• 2-pronged catalysts

  • Deleveraging by selling assets

  • Tailwind from the Swedish 2026 legislation changes

• Catalyst 1

  • When? Q4 2025 reporting in 6 Feb 2026

  • Deleveraging : turning into net cash; solidity ratio turns into positive

  • Estimated FY 2025 EBIT range 15-30M sek

  • A potential of 0-200% upside from the current share price (0 meaning the deleveraged play is priced in and EBIT on the low range) due to expansion in valuation multiples

  • Any increase of EBIT from 15M may lead to price appreciation.

• Catalyst 2:

  • When? FY 2025 i.e. 12-15 months

  • 3 specific Swedish legislative tailwinds in 2026

  • Estimated FY 2026 EBIT 25.5-40.5M sek

  • A potential 150-250% from the current share price due to increasing profitability and expansion in valuation multiples

• A classic play of “beating the street“ due to the extreme debt valuation and micro market cap (if I am right)

For you value investing and numbers nerd that are still here, let’s get straight to it! (Links to references all below)

The business

Moment Group AB is a leading Scandinavian player in the experience industry. The group operates through four distinct segments that create, produce, and deliver everything from large-scale musicals to corporate events and activity-based dining.

Below is the segments, based on 1.1B sek revenue FY 2024

The problem? It was considered a growth darling pre-pandemic and acquiring lots of businesses with low-interest debt. Then pandemic and high interest happened.

Lynch category

A turnaround play

Fast-Change or Slow-Change industry?

Slow-change

What is the Moat?

• Physical scarcity: owning or holding long-term leases of 16 iconic venues in Sweden and other major Scandinavian cities.

• Network effect of venues. They can “tour“ the same production all around, minimizing costs for expensive set, costume, etc

• IP & Artist access: Swedish legends like Magnus Uggla and Roxette estate have stayed with them for 30+ years. They also secure long-term rights for show licences.

Is the Moat widening or narrowing?

I’d say wide, but not widening.

Can a “dummy” run this business?

No, a dummy cannot run this business.

The “dummy“ CEO ran the group to the ground pre-pandemic with the acquisition spree, and it was the then-CFO and current-CEO Martin du Hane who led the current turnaround.

Together with Leif West (representing the major shareholder), who will make sure that the turnaround actually happens.

Skin in the Game?

• Gelba Management AB: 26.5% ownership
  Chairman Leif West represents Gelba, which is a private investment vehicle of Per Taube. Per Taube is known for buying distressed real estate assets (Arlandastand, Steninge Slott) and using long-term patience to turn them into cash flow machines. He kept increasing his shares throughout 2024-2025, buying potentially at a price >7.0 sek.

• CEO du Hane: 22,500 shares
  This equals to 123,000 sek. With his FY 2024 gross remuneration of about 3.6M sek, this is not much but it is something.

• CEO of 2Entertain segment Janne Andersson: 0.7%
  This equals to nominal value of ~1M sek.

In the end of the day, the main owners are also current operators trying to ensure the turnover is happening.

Good capital allocators?

In terms of the turnaround, CEO Martin du Hane and Chairman Leif West have been good capital allocators, focusing everything on reducing debt:

• Tickster sale in December 2025 for 62.5M sek.

• Pruning the portfolio and taking impairments in 2024 for 41M sek.

• Conservative allocation of the float “Prepaid Ticket Revenue“ during the high-interest years

• No dividend policy

The integrity and track record

Good for turnaround play so far.
Martin du Hane & Leif West are not playing a 'growth' or ‘shareholder value creation‘ game. By selling Tickster and stopping the dividend, they are effectively buying back the company's future from its bondholders. It shows high level of financial discipline.

Is the Balance Sheet a Fortress?

Nope, that is why we are here. Their debt structure as of Q3 2025:

• Bond loan

  • 109 M sek

  • Interest rate of 8-9%

  • Interest expense: 9.5M sek / year

  • Maturity in March 2027

  • Maximum pay down of 50M sek according to the covenants

• COVID deferred tax

  • 23M sek

  • 1-2M sek (amortization+interest) paid monthly until Aug 2027

Quality of cash flow

• Moment Group has a unique cash flow profile driven by Prepaid Ticket Revenues.

  Positive Float: Customers pay for tickets months in advance (especially for 2Entertain). This provides upfront liquidity that the company uses to fund productions before they premiere.
  In Liabilities side, accounted as Prepaid ticket revenues. In Assets side, accounted as Cash and Cash Equivalents.

• Seasonality - typically loss-loss-loss-profit

  • Q1: stable, benefiting from the tail-end of winter theater runs when the Prepaid ticket revenues becomes liquid.

  • Q2 & Q3: Low Season with operating losses. Many theaters are closed over the summer in the Nordics.

  • Q4: essentially funds the rest of the year.

The floor

• The pessimistic floor: if my analysis is wrong, your money is gone. Though with the Tickster divestment this is very unlikely.

• The realistic floor:

  • They do rights issue, diluting current shareholders - which is hard to believe with Gelba being the shareholders.

  • They take more debt from Gelba.

  • Per Taube / Gelba gets tired, take-over and de-list Moment Group. His close-to 30% ownership might trigger a takeover bid under the Swedish law [1]. Total market cap of Moment Group is less than 5% of Gelba’s total AUM [2], so it is entirely possible. They bought consistently through 2024-2025 with share price >7.0 sek. This will be still 20-25% upside in this case.

    The main triggers for the floor valuation may be:

    • A COVID-like event

    • A huge jump in leasing costs e.g. due to interest rate hikes

    • Cancellation of pre-paid tours due to artists being unable to perform, theaters collapsing, etc.

    • At this point, it is too difficult to guess the outcome… so better be ready to lose your investment and allocate your asset accordingly.

The Catalyst: Why Now?

There are 2 catalysts coming, the deleveraging and the tailwind catalysts.

The deleveraging catalyst

The sale of Tickster in Dec 2025:

• Headline sale price of 62.5M sek

• Tax-exempt according to Swedish tax law [3]

• Less transaction cost

• Net cash proceed: 60M sek

• Explicit mention by the CEO & Chairman that this will be used to strengthen the balance sheet and increase liquidity [4]

According to the bond debt covenants, they can pay down max 50M sek now.

So the bond loan pro forma:

• 109M - 50M = 59M sek

• Interest rate of 8-9%

• Interest expense: ~5M sek annualy instead of 9.3M annualy, gaining 4.3M sek annualy

• The Swedish tax office allows a deduction of up to 5M sek in negative net interest [5]. This means they gain 4.3M sek / year on the bottom line without needing to sell more show tickets or refinance debt! (for 2026)

Considering the effect as a whole:

• Q3 2025 (today’s market cap)

  • Cash: 73M sek

  • Interest-bearing debt (excluding leases): 132M sek

  • Net debt (excluding leases): 59M sek

  • Shareholder equity: -14M sek

  • Interest coverage (excluding leases): negative
    (excluding one-off 14M / 9.3M = 1.5x)

  • EV (excluding leases): 200M sek

  • Solidity ratio: negative

• Q4 2025

  • Tickster sale 60M in cash

    • Cash in 60M sek

    • Asset out 13.5M sek (Tickster BV)

    • Equity gain 46.5M sek (Tickster profit)

    • Debt repayment -50M sek

    • Cash out -50M sek (bond repayment)

  • Cash: 83M sek

  • Interest-bearing debt (excluding leases): 82M sek

  • Net debt (excluding leases): -1M sek (net cash!)

  • Shareholder equity: Q3 = 32.5M

  • New assets = old assets - Tickster BV + net cash in = 955M - 13.5 + 10M = 956M sek

  • Interest coverage (excluding leases): negative
    (excluding one-off 14M / 5M = 2.8x)

  • EV (excluding leases) = 140M

  • Solidity ratio: 3.1% (positive! Scandic Hotels is 6.3% for reference)

With healthy finances on paper and positive solidity ratio, they can re-finance the debt with lower interest rate and they are again opened for investing from pension funds and institutional investor.

Let’s see what their valuation will be after the debt pay down. Since their earnings the past years involved so many one-off items, let’s take a look from FY 2022 until TTM:

• FY 2022:
  Reported EBIT 63M sek - 25M sek (one off as pandemic support) = 38M sek

• FY 2023:
  Reported EBIT 67M sek - 12M sek (settlement gains) = 55M sek

• FY 2024;

  Reported EBIT -16M sek + 45M sek (Q4 impairments) = 29M sek

• TTM:

  Reported EBIT -31M sek + 45M sek (Q4 2024) = 14M sek
  Note that reported EBIT TTM -31M sek is affected by renovation closure in Cirkusbygningen in Copehagen (comparison between Q2-Q3 2024 vs 2025 may indicate a one-off operation loss of ~15M sek, but we will ignore this now).

• Ignoring the Copenhagen renovation one-off cost, we can assume that FY 2025 adjusted EBIT should be about 15-30M sek.

  • Low at 15M sek: assuming similar Q4 2025 performance as Q4 2024.

  • High at 30M sek: assuming back to FY 2024 (as if Cirkusbygningen is not closed) and/or due to economic tailwinds and increase in production.

  • If Cirkusbygningen is open i.e. for 2026, the EBIT range would realistically be 25-40M sek.

• Net earnings will be: 5.5-17.5M sek (5M bond interest and deduction, 3M Q4 deferred tax payment, 20.6% Swedish corporate tax)

Pro forma multiples (assuming the new healthier finances):

• For reference

  • SkiStar P/E ~22-23x, op.EV/EBIT 14-16x

  • Scandic hotels P/E ~27-28x, op.EV/EBIT 11-13x

  • Small-cap leisure P/E 9-11x, op.EV/EBIT 8-10x

• P/E of 9-11x, this implies market cap of 55-175M sek —> between -60% - 25%

• op. EV/EBIT (excluding leases) 8-10x

  • Pro forma op. EV/EBIT 4.7-9.3x —> between 0-200% upside

I believe EV/EBIT is a more suitable multiple, but the P/E is there to ground my expectation.

Basically, for the stock to appreciate, the Q4 2025 EBIT needs to be equal to or higher than Q4 2024 EBIT. Is this likely? Yes, according to these:

• The additions of major venues like Lorensbergsteatern and reopened Cirkusbygningen suggest significant increase in shows and events in late 2025 compared to late 2024

• Swedish household spending is in an increasing trend YoY [8]

The 2026 Swedish legislative catalysts

The Swedish regulatory changes in 2026 may boost Moment Group’s profitability on top of the deleveraging story [6].

• The Dance VAT Reduction (25% —> 6%)

  • Effective July 1, 2026, the VAT on “admission to dance events” (moms på danstillställningar) drops from 25% to 6%. This explicitly includes nightclub entry fees like Moment Group’s Golden Hits and other Wallmans venues

  • If a guest pays 200 SEK for nightclub entry:

    • Old rules (25% VAT): Moment Group keeps 160 sek

    • New rules (6% VAT): Moment Group keeps 188 sek

    • Net gain of +17.5% increase with 0 cost increase (VAT is taken at the top line)

  • Estimated Bottom Line Effect (2026):

    • Wallmans Group’s Q4 2024 revenue is 143M sek and EBIT margin 23%

    • Assume 10% is dance-related, that’s an additional EBIT of 3.5M sek

• Reduced Employer Contributions (19–23 Year Olds)

  • The Law: Temporary reduction of employer fees (arbetsgivaravgifter) for employees aged 19–23 starting April 1, 2026

    • Rate Drop: From 31.42 —> 10.21% (Saving ~21.2%).

  • Moment Group’s exposure is very high here. If you go to some musicals, restaurants, dance clubs, bowling place, etc - you rarely see 25+ year-old working there! Based on industry averages and Moment Group’s activity reports, roughly 25–30% of their workforce (~100–120 FTEs) likely falls into this age bracket.

  • Financial Calculation:

    • Assumptions: 100 eligible FTEs, average monthly salary 23,000 SEK [7].

    • Monthly Savings: $23,000 100 FTE * 21.2% = 551,200 sek / month.

    • 2026 Effect (Q2-Q4): $551,200 * 9 = 5M sek, directly to EBIT

  • This effect is temporary, potentially only have significant effects on Q4 2026. Though I am sure the extra cash helps increase profitability of the whole group in the future

3. Household Income Surge

• Expected to increase +5,700 SEK/month for 2-income household, which is about 5-10% increase on average for the Swedish population

• Driven by multiple legislative changes:

  1. Jobbskatteavdrag 2026: A direct income tax cut (~400–500 SEK/person).

  2. Temporary lowered VAT for food.

  3. Real Wage Growth: Wages rising faster than inflation for the first time in years.

• Projection for Moment Group:

  • If this income boost increases sales volume by a range of 2%, it could add to about 1.5-3.0 MSEK to EBIT.

Assuming no organic growth from 2025 to 2026 and no contribution on the Cirkusbygningen re-opening:

FY 2026 EBIT = FY 2025 EBIT + 3.5M sek + 5M sek + 2M sek = 25.5-40.5M sek

FY 2026 Net earnings

= FY2026 EBIT - interest expense (no interest expense due to deduction) - tax = 20-32M sek

Forward multiples for 2026

• P/E of 9-11x, this implies market cap of 200-324M sek —> between 50%-230% upside

• op. EV/EBIT 8-10x

  • Pro forma op. EV/EBIT 3.6-5.7 —> between 140%-280% upside

This naturally depends on how the management is able to exploit these legislative tailwinds. But with how they are doing the past years with huge debts (not their fault) in a high interest rate environment, I believe they would exploit the opportunity.

Lastly, why the smart money has not been here?

• The “Safety First“ Mandate: large funds are often legally or internally prohibited from investing in companies with low solidity ratio, low shareholders' equity and high debt-to-equity ratio.

• Liquidity: smart money usually manages billions. They need to be able to buy or sell millions of kronor worth of shares without moving the price too much.

• Similarly, low-to-none analyst coverage.

• No dividends.

This is a classic study case of “beating the street“ (If I’m right)

Disclaimer: I am not a licensed financial advisor. I may hold positions in the securities discussed. The content provided in "The Northside" is for informational and educational purposes only and represents the personal opinions of the author. It is not intended to be, and does not constitute, financial, investment, legal, or tax advice. Investing involves risk, mostly the risk of losing money because you listened to a stranger on the internet. Do your own due diligence.

References
[1] https://resourcehub.bakermckenzie.com/en/resources/global-public-ma-guide/europe-middle-east-and-africa/sweden/topics/effecting-a-takeover
[2] https://sok.vainu.com/company/gelba-management-aktiebolag-omsattning-och-nyckeltal/SE5563436848/foretagsinfo
[3] https://www4.skatteverket.se/rattsligvagledning/edition/2024.1/331529.html
[4] https://via.tt.se/pressmeddelande/4200446/moment-group-starker-sin-finansiella-stallning-genom-att-salja-innehavet-i-tickster-for-625-msek?publisherId=1951950&lang=sv
[5] https://sweden.dlapiper.com/en/news/nordic-tax-law-bulletin-april-0#:~:text=As%20of%201%20January%202019,within%20a%20six%2Dyear%20period.
[6] https://verksamt.se/en/news/law-changes-2026
[7] https://www.paylab.com/se/salaries-in-country
[8] https://tradingeconomics.com/sweden/household-spending