Q: Good morning 5i: I have just listened to the podcast focusing on energy. Michael briefly discussed his research and thoughts on SES, but did not mention the acquisition by GFL. I suspect this may be due to the fact that the podcast was recorded prior to the news. My question: does the acquisition by GFL affect his remarks and opinions as the management will differ? Thank you.
5i Research Answer:
Yes, the recording was prior to the offer and yes it does change things. We expect the offer to succeed and thus SES will ultimately be de-listed. We think the GFL combination does make sense, though the stock will be volatile until close, and it is a fairly big--and thus somewhat risky--deal. But it will be accretive to GFL earnings, and bigger is better in this industry. We would expect shares to be higher next year once the benefits of the acquisition are realized.