{ "docId": "019dd923-622c-750b-8b98-eaae8b08698d", "docSlug": "c665ec3b53b5", "documentTitle": "Amcor plc (pro forma Amcor-Berry Global combination) (AMCR)", "authorId": "54_Spruce_Point_Capital", "authorName": "Ben Axler", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2020-03-10 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 56, "pageCount": 95, "prevPage": 55, "nextPage": 57, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "dense", "nDataPoints": 3, "notes": "Uses direct quotes from official company documents to frame the argument of cost over-runs.", "elementsJson": [ "headline_text", "callout_box", "quote_block", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b98-eaae8b08698d/56", "deckHref": "/decks/019dd923-622c-750b-8b98-eaae8b08698d", "deckJsonHref": "/decks/019dd923-622c-750b-8b98-eaae8b08698d.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b98-eaae8b08698d#slide-56", "components": [ { "bbox": { "h": 0.07, "w": 0.98, "x": 0.01, "y": 0.178 }, "kind": "callout", "text": "We believe there are significant cost over-runs in the Amcor / Bemis transaction. In particular, the Company forecasted $125m of transaction costs.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ca8c31cb-f907-41b5-87db-9aaa8d26a58a", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.98, "x": 0.01, "y": 0.895 }, "kind": "disclaimer", "text": "Note: GST = Goods and Services Tax which Amcor later says, β€œIt is anticipated that New Amcor will maintain ISE status and the New Amcor board intends to conduct the business of the combined company such that no GST will be incurred by New Amcor.”", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "3114ff7f-740d-4e7a-9026-4fb51064f86a", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.82, "x": 0.165, "y": 0.305 }, "kind": "list", "text": "Integration, compensation and transaction costs are substantial... estimated integration costs of US$150 million, approximately US$65 million of compensation costs and approximately US$125 million of transaction costs.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0f1c70fe-70b7-4802-aaaf-32bdd8941ca1", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.22, "w": 0.82, "x": 0.165, "y": 0.498 }, "kind": "list", "text": "Amcor anticipates the following costs... integration costs of approximately US$150 million... compensation and transaction costs comprising approximately US$65 million of compensation costs and approximately US$125 million of transaction costs.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "d2a40eb3-0109-4eeb-8341-cc11647bf559", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.98, "x": 0.01, "y": 0.835 }, "kind": "paragraph", "text": "16. Compensation costs comprise Bemis employee entitlement and retention costs and transaction costs reflect acquisition costs, such as advisory, legal and accounting expenses. 17. Estimated costs to be incurred up to the Scheme Meeting on 2 May 2019.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0b083812-862c-4575-b092-7011e0dbb3c1", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "Integration, compensation and transaction costs are substantial. The costs to implement the Transaction are substantial and include estimated integration costs of US$150 million, approximately US$65 million of compensation costs and approximately US$125 million of transaction costs(excluding GST). Both integration and transaction cash costs are expected to be broadly offset by savings in capital expenditure and working capital over a similar time period (refer to Sections 10.3.2 and 10.3.3 of this report). A significant portion of transaction costs (US$45 million) will be incurred by Amcor (stand-alone) regardless of whether the Transaction is implemented. β€” Amcor Scheme Booklet, March 13, 2019", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-2b65-734e-a985-4f8b978754d2", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.055, "w": 0.385, "x": 0.308, "y": 0.045 }, "kind": "title", "text": "Deal Costs Expectations", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "02cc4c55-948c-4bb6-acd7-15c99b98bdfe", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "c89e27ca-f401-4a28-bdcf-64df3c784d28", "evidence": "Uses official company disclosures to highlight potential cost over-runs and contradictions.", "confidence": 0.85 } ], "arcBeats": [], "loops": [ { "to": 59, "from": 52, "name": "Quick Win Big Bet", "slug": "47-quick-win-big-bet", "bestFor": "Transformation planning, 100-day plans, resource allocation", "matchId": "53c07a7b-0b0c-4f14-baa7-c199804d850d", "evidence": "The deck presents benchmarking analysis to argue that Amcor's synergies are suspect.", "position": 2, "objective": "To argue that investing in Amcor is not a great thesis", "structure": "The Full List -> Quick Wins (Low effort, High impact) -> Big Bets (High effort, High impact) -> Sequenced Roadmap", "confidence": 0.6, "description": "Separate initiatives into immediate wins and longer-term strategic bets" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }