KEDM Lite Vol. 22

Actionable event-driven and special situations

We highlight and monitor actionable event-driven trades and special situations.

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Disclaimer. KEDM Lite is provided for informative purposes only. No due diligence has (yet) been performed on the names on this list. The list might change strongly on a regular basis. This overview does not constitute advice; always do your own due diligence. The list is dynamic; it continues to grow and change. If you have interesting additions to the list, feel free to contact us at info@kedm.com or on Twitter. For the full disclaimer, please go here.

This week’s additions and highlights

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1. SPIN-OFFS

• Valmet (VALMT FH). Valmet launched a strategic review to see if it makes sense to split the company into two listed businesses, separating its Biomaterial Solutions and Process Performance Solutions units. Spoiler alert: it makes a lot of sense. This thing has long carried a large holdco discount, with one unit (PPS) growing nicely (dd topline growth + solid margin expansion), while the other just being a big drag. The shares moved strongly on the news but are just back at levels of a few months ago. The group is trading at ~8x forward EV/EBITDA - that won’t be the case for each unit separately.

• Flex (FLEX US). Flex recently jumped on a strong 2027 outlook but also plans to spin off its cloud and power infrastructure business, the latter separating its rapidly growing AI-focused business from the core manufacturing business. Let’s wait for more details, but you know we like to keep a close eye on potential hype stocks. Also, a reminder that the previous spin Nextpower (NXT US) is up almost 200% in roughly a year. Will we get a repeat?

  UPDATE (July 28, 2026) The cloud and power infra spin-off is progressing, with the company mentioning that spinco will have ~$6.6bn in revenue, with management guiding for 65-75% growth this year and 80%+ next. Close(st) peer Vertiv (VRT) is currently trading at 11x EV/sales, which would provide decent upside from here.

• UPM-Kymmene (UPM FH). The spin of the smaller UPM Plywood units is progressing, with UPM first time reporting it as discontinued operations (that’s the IFRS way). Spin still on track for Oct 31. A reminder here that this thing might be interesting given quite the smaller size and different business vs the rest of the business. Adding to that is that basically every unit’s (roughly 6) businesses are sucking at the moment. We could see a REALLY big dump in the shares here.

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2. STRATEGIC ALTERNATIVES & REVIEWS

(Potential take-outs, asset sales, M&A, etc.)

• Domo (DOMO US). Domo will be exploring strategic alternatives. The market has not been kind to this company as growth strongly decelerated in 2023-2024. With that, the focus shifted towards profitability, where there’s plenty of opportunity still with roughly 75% gross margins. Domo will finally achieved positive EBITDA this year. To note that, despite the typical disgusting software SBC, management regularly purchased shares on the open market. Undoubtedly the share price has been hammered by the pressures from AI as well. We generally like to see the price stabilize, which it doesn’t seem to be anywhere close to, but already ~10x EV/EBITDA for what could be 20-30% EBITDA growth p.a. over the medium-term.

  UPDATE (July 28, 2026) Domo is finally done with its strategic review, selling its ‘core AI and data business’ for $400m to PRGS, which is quite nice considering a $150m EV. Domo will remain a listed shell, holding roughly $250m in cash and over $900m NOLs, with the company aiming to monetize these with a future transaction. There’s also going to be some or capital returns. It might finally be the time to take a serious look. Part of the discount could be the massively disgusting SBC.