Intermoney | On Saturday afternoon, Telefónica (TEF) informed the National Securities Market Commission (CNMV) that it was dismissing its current chairman, Jose María Álvarez-Pallete, and appointing Marc Murtra (current chairman of Indra) as the new chairman. Indra (IDR) yesterday issued a statement announcing the resignation of its current chairman, and also announcing the appointment of Ángel Escribano as the new executive chairman.
Escribano is co-founder and owner with his brother of Escribano Mechanical and Engineering, a company specialising in the defence industry, with an annual turnover of around €300 million. Together with his brother, he owns a 14% stake in Indra, being the largest private shareholder and the second largest after SEPI.
Assessment: We see this news in both positive and negative ways. It is worrying that the person who was going to carry out Indra’s M&A operations has left the company before even starting the process. On the other hand, we think that Escribano’s profile, less linked to politics and more specialised in the defence industry, could serve to accelerate the process of divestment in the technology subsidiary and the consolidation of the defence sector at national level. Moreover, with Murtra at the helm of Telefónica, we see a sale of Minsait to Telefónica as more likely. In conclusion, we see more pros than cons in this news for Indra and think that the market should react positively. We reiterate our Buy recommendation with a target price of €22.
