Semapa: Continue waiting?
Update Q1 2025
Short description
Semapa is a conglomerate based in Portugal with interests in various sectors, with its primary activity lying in the paper and pulp industry. The company is a significant player in the European paper and pulp market and holds a strong presence in several other sectors.
Semapa's main subsidiary is The Navigator Company, formerly known as Portucel Soporcel, one of the largest producers of uncoated woodfree paper in the world. The company manufactures a wide range of products, including printing and writing paper, packaging paper, and speciality pulp.
In addition to the paper and pulp industry, Semapa is also involved in other sectors, namely cement, renewable energy, environmental services (including hydrogen), and growth investments.
The Cement segment has been active through the company Secil longer than the paper sector. In 2004, they sold a portion of Secil, which they later repurchased. With the proceeds, Navigator was purchased, then known as Portucel.
Why we selected Semapa
Semapa is a company that always seems to trade at a low valuation. The sectors it operates in are not very attractive and are cyclical in nature.
The company performed better than I had expected during this period; however, the question remains whether the discount will ever be realized.
The family, which now owns 88% of the shares, has already tried twice in the past to take the company private. This also seems to be the only way for the value to be unlocked. Should we wait for that or not?