Solvay SA SOLB BB
Post-spin Solvay — a #1 essential-chemicals business — trades at ~7x trough 2024 EPS with ~10% dividend yield; normalized 2028 earnings support roughly doubling the stock.
Thesis
Greenlight's April 2024 Sohn pitch is the post-spinoff 'new Solvay' (SOLB BB), a 160-year-old Belgian essential-chemicals business that shed its specialty arm as Syensqo in December 2023. Solvay holds #1 global positions in soda ash, peroxides, silica, special chem and Coatis — boring but high-margin commodity lines delivering 25.5% EBITDA margins, 20.4% ROCE and modest 1.2x leverage. 2024 is a trough year: European destocking, a soda-ash price reset and energy-cost normalization drive EPS from €5.40 in 2023 to ~€3.62-€4. The sell-side has capitulated to underweight with €21.50 price targets, yet at €25.30 the stock trades at ~7x depressed earnings with a ~10% dividend yield. Management's 2028 targets imply ~€6.79 EPS. At twice the price, Einhorn argues, it still wouldn't look expensive.
SCQA
Solvay is a 160-year-old Belgian essential-chemicals business that, post-December 2023 spinoff of Syensqo, holds #1 global positions across soda ash, peroxides, silica, special chem and Coatis with 25.5% EBITDA margins.
2024 is a cyclical trough — European destocking, a soda-ash pricing reset and energy normalization cut EPS from €5.40 to ~€3.62, driving sell-side underweights and a 7x multiple despite the decline being transient, not structural.
Buy the stock at €25.30 and collect the near-10% dividend while management executes its 2028 plan: mid-single-digit EBITDA growth, mid-to-high-20s margins, €300mn run-rate gross savings, investment-grade balance sheet.
Normalized 2028 EPS of ~€6.79 at a still-cheap multiple supports roughly doubling the stock — 'at twice the price, it wouldn't seem expensive' — plus ~10% annual dividend yield en route.
The three reasons
- 1
Post-spin 'new Solvay' is a #1-position essential chemicals business at 7x trough 2024 EPS
- 2
2024 is cyclical trough; 2028 targets imply ~€6.79 EPS near prior peak
- 3
Near-10% dividend yield returns half the market cap over five years
Primary demands
- Buy the post-spinoff 'new Solvay' as a value long at ~7x trough 2024 earnings
- Collect the near-10% dividend while management executes its 2028 plan
- Own it into a normalization of European chemicals earnings toward the 2028 targets
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Warren Buffett in the 1950s — a 'great time to be a value investor' analogue for today's thinned-out active management
Notable slides (6)
Notes
Sohn Investment Conference 2024 pitch by David Einhorn. 'Solve-AI' is deliberate wordplay — Einhorn pitches boring Belgian chemicals into the AI-mania zeitgeist. This is a long value idea, not an activist campaign: no demands on management, no board agitation, tone is collegial (slide 42 quotes Solvay favorably). Greenlight genre rather than typical activist deck — classic Einhorn Sohn style with chemistry jokes and CartoonStock cartoons as connective tissue. Stake size not disclosed in deck. Document type = conference_presentation given the explicit Sohn framing on the cover. Campaign_phase = initial_thesis (first public pitch of this idea).