Nucor earnings beat by $0.08, revenue fell short of estimates
Investing.com -- Shares in Danish hearing aid maker Demant (CSE:DEMANT) rose more than 4% on Wednesday after the company announced the acquisition of German hearing aid retailer KIND for about DKr5.2 billion in cash.
The transaction is expected to close in the second half of 2025 and will be funded entirely through debt, Demant said.
As part of the financing strategy, the company is suspending its share buyback program.
Once the deal is finalized, Demant will become the largest player in Germany’s hearing aid market with a combined market share of roughly 12%, up from its current 4%. KIND holds about 8% of the German market.
Citi Research analysts said the transaction appears “strategically sensible,” projecting it to be neutral to earnings per share in 2026, given the halted buyback program.
Demant expects KIND to generate about DKr2.2 billion in revenue in 2026 and operate at a mid-teens margin.
Citi said KIND’s margin could move in line with Demant’s group level, into the high-teens, by 2027 or 2028 as Demant increases its supply penetration at KIND from about 25% to 95%.
The company anticipates the acquisition will be accretive to earnings per share in the first year following closing.
Citi estimates the transaction will add about DKr134 million in net income in 2026, assuming a 15% margin and 3% cost of debt, compared to its current forecast of DKr3.23 billion in net income for Demant that year.
The deal values KIND at about 2.36 times its estimated 2026 revenue, a level Citi said is broadly consistent with prior large-scale hearing aid retail transactions.
Citi expects the deal to support low- to mid-single-digit percentage EPS accretion in the years following 2026, driven by higher margins and lower leverage.