Good afternoon. We welcome you to Sonae's conference call regarding Musti tender offer. During the presentation, hosted by Mr. João Dolores, Sonae CFO, all participants will be on a listen-only mode. There will be an opportunity for Q&A at the end of the presentation. If you wish to ask a question during the Q&A session, you may do so by pressing the star key, followed by one on your telephone keypad. I now hand the call over to Mr. João Dolores. Please go ahead, sir.
Thank you very much. Hi, everyone. Thanks for joining us today, on such short notice. As you know, this morning we announced the launch of a public tender offer over Musti Group shares. Musti is the leading pet care retailer in the Nordics. My goal for today is to explain the rationale for this transaction and obviously answer any questions that you may have at this stage. I, I will briefly start with a quick update on Sonae's recent performance and track record, and then I will cover Musti, the investment rationale, and also the transaction structure, which is ongoing at this moment. Starting with Sonae. As you know, Sonae has been demonstrating a strong portfolio management activity in the last 4-5 years.
And we have been doing this in order to reach our strategic goals in terms of growth, international diversification, profitability, and financial strength. As you have seen over the past few years, we've executed a number of exits from non-core businesses. The latest one with a critical dimension was ISRG. Obviously, in these exits, we have been able to generate very significant cash proceeds and fund the growth of the group for the next few years. On the other hand, we have ensured a higher control over our core investments, namely at NOS and Sierra, two of the largest assets in the portfolio, which we did not control, or we had a lower degree of control.
Now we have, we are by far the largest shareholder in NOS, and we have 100% of Sierra, two businesses which are critical in our portfolio. We have struck a number of value-creating partnerships in a few of other businesses. So MC, with the partnership with CVC, has been a very important transaction for us in order to bring along an important and well-renowned partner to help us drive the business going into the future, while generating very important cash proceeds for the group. At Sierra, as you know, we've sold participation in a number of core assets in Iberia with the Sierra Prime transaction, and we also merged our operation in Brazil twice, so first with Aliansce and then with BR Malls, to form the largest shopping center operation in South America.
And we recently announced a partnership with Bankinter to form the leading consumer credit operation in Portugal. And finally, we have been deploying capital in a number of new growth avenues for the group, both within our existing businesses and also in some new investment areas, such as Bright Pixel, Sparkfood, our most recent business unit dedicated to investing in technology and innovation around food production. And also the merger that we announced between Arenal and Druni in Spain to form the largest health and wellness and beauty player in Iberia. Today, I'm going to talk to you about another investment opportunity, which we, we believe is going to be important for our growth and value creation in years to come.
In terms of financial performance, as you see, Sonae has been able to present a strong level of growth in these last few years. In 2023, we will actually surpass the EUR 8 billion mark in terms of total revenues for the first time ever. The total value of our portfolio has increased quite significantly to over EUR 4 billion in the last few years, as we continue to deleverage the group, given the high cash flow generation ability of our businesses, and also a number of portfolio moves, which again, produce significant cash proceeds and helped improve the financial strength of the group. So this being said, I will now jump to our recent announcement, and I will talk a little bit about the rationale for this announcement. Pet care is not a new sector for Sonae.
As you know, we have an operation in pet care, historically, at MC, both within our supermarkets and also, in ZU, our specialized pet retail chain. But we have been following this sector, with a view of further investing in it, given, its long-term potential and fits with our strategy. We have been studying the sector for quite some time. Why pet care retail? Well, first of all, because it's a growing sector. We are seeing increased pet ownership and pet care spending across Europe, in the last few years. The sector is benefiting from very strong tailwinds, underpinned by the premiumization and humanization of pets, which supports, its long-term, growth path, with a very high resilience, to recessions and external shocks.
Pet care has a heavy non-discretionary element in terms of consumption pattern, in particular, in what relates to pet food. We are seeing also trends of increased urbanization and improving living standards, which increase the availability and share of wallets for pets, tutoring, and spending. So this is clearly a sector that we have been looking at for quite some time, looking at possible investment opportunities in the last few years. When we look into the future, we see that the pet care market is expected to continue to grow at a very significant rate. So when we look at the European pet care retail market, the trend is for a growth of 5%-6%.
In terms of profit pools, specialty stores and specialized retail enjoys the largest profitability of all channels that cater to pet parents. And this is the opportunity that we are talking about today, is precisely an opportunity around specialty retail in pet care. If you look at the European landscape, there are several players that have been consolidating this space. You can see on the slide the largest ones. Musti is part of that group. Musti is the leading operator, again, in Finland, Sweden, and Norway, with over 340 stores and turnover above EUR 400 million.
And if we move forward, you can see a little bit more detail about the Nordics market and also about the pet care market in the Nordics. If you look at the markets, you can see that the Nordics is a very interesting and attractive market in terms of macro fundamentals, with high GDP per capita, considering the European average, and also high disposable income per household, which sustain a very strong outlook for these markets going forward. Musti is present in these markets, obviously. The total pet care market in the Nordics currently accounts for over EUR 2 billion in sales. The expectation here, again, is growth around 5% a year in the next few years to roughly above EUR 2.6 billion by 2027.
You can see that this is supported by the under-penetration that we still see in terms of ownership of pets, both dogs and cats, in the three countries where we still see an opportunity for an increase. Going a bit more into the detail of the company. Musti is by far the largest player in the region, as you can see. It has a value proposition anchored around an omnichannel presence, but also a pure-play presence. And so in all three countries, Musti has a brand that operates with an omnichannel logic, but also a pure-play brand that competes in a different space, which is a very interesting strategy that the company has been following over the last few years.
As you can see, the company started in Finland, where it has the largest presence and largest market share, with 32% estimated market share at the end of fiscal year 2023. In Sweden, market share is 28%, so already the leading player as well, but filled with potential to grow in terms of store network and penetration. And in Norway, it is already the largest player. It's the most recent market for the brand. But we see a huge potential to continue to grow in Norway, to expand its store footprint, and also expand the penetration in the country. I think a very important element to Musti's value proposition and presence is also the fact that it has a loyalty program, and a number more than EUR 1.5 million...
One and a half million customers who are loyal customers, and that keep purchasing in the different banners from that belong to the company. If you look at the track record of Musti, Musti has a very interesting track record of growth, as you can see. It stems from organic growth, but also from acquisitions that were made over the last few years. But the growth has been quite substantial, strong double-digit growth over the last few years, and with the most recent M&A movement, the acquisition of the pet food production plant in Finland, which is a very important element of the value proposition of the company. In terms of profile, you can see the splits between different countries.
As you can see, Norway still only accounts for 15%, and we expect that to increase over the next few years. In terms of online, you can see that the penetration is quite substantial, given its omnichannel value proposition and also, also its pure play offering, well above 20% in terms of penetration and a key growth lever for the company in years to come. And a very important element that I would like to stress is the weight of own and exclusive brands in the total sales of the company. These brands already account for over 50% of sales.
We are talking about brands that the company has developed that command a very strong branding and awareness in customers in these regions, and that are a very important driver of profitability in years to come, because the expectation is that the penetration of these brands will continue to increase. If you look at profitability, the track record has also been great over the last few years, so 22% year-on-year annual growth in the last five years. And currently, the company has presented a margin of 17.3% EBITDA margin at the end of fiscal year 2023.
The consortium, as you've seen, is composed not only of Sonae, obviously, but of three key Musti executives with a long experience and a successful track record in the pet care retail market. Together with us in the consortium, we have Jeffrey David, the Chairman of the Board, Johan Dettel, a Non-Executive Director, and David Rönnberg, the CEO of the company, that have joined us in this consortium to take this company into its next stage of development, and to be able to bring this company to a next level of growth going into the future. So with these partners, we believe that the consortium has, I would say, exceptional operational experience, know-how, and track record in the pet care sector, in the local market, in the Nordics.
And if we join this with the company's current competitive position and value proposition, and with Sonae's expertise in omnichannel retail, our commitment as a shareholder and our geographical outreach, we believe we have the right ingredients to take this company to the next level of development. As you can see, there are a number of value creation levers going into the future that we believe that together with the members of the consortium, we are going to be able to tap into. Obviously, the company and the brands will continue to be exposed to the market growth, to the inherent market growth, that we see in pet care retail in the Nordics. But as I said before, there is still a very significant room for store network expansion.
So we see at least potential for an additional 100, 100 stores in these markets, namely in Norway and Sweden, in the next few years. We believe that Sonae can play a role in helping the company drive that growth, given the expertise that we have in terms of expansion of our own retail formats in different geographies. There's a lot of potential, as I said before, also in terms of online growth. Online continues to grow, and the company is very well positioned to capture that growth. And obviously, Sonae, with its experience in e-commerce along the years, can bring a lot of value to that discussion as well, and to the strategy of the company.
I talked about the penetration of O&E products, where we believe that we can also bring many of our learnings throughout the years in developing own label products to help the company drive this growth in the next few years. There's a lot of potential to build an ecosystem of services around the offering and the footprint that the company already has. And so the brands, I didn't talk about this before, but Musti already has a breadth of services that it offers in store. There's potential to continue to grow that range of services in many more stores. And so this is a key driver of loyalty, which we believe that we can boost as well in the next few years. In terms of loyalty, I spoke about the loyalty program.
This is definitely an area where we have a lot of expertise, and can bring that expertise and help the company progress going into the future. And obviously, the advantages of scale going forward and growing the company and making sure that the operating leverage is translated into higher profitability. This is something that we have experience with as well, and this is value that we can bring to the table. So overall, I would say that Musti is a very attractive opportunity for Sonae. We feel that together with the track record of the company, the management team that we have alongside us, and Sonae's assets and capabilities, we are going to be able to bring this company to the next level of growth and development.
We believe we, we are going to be able to do that in a market that is a high growth market with very strong fundamentals, taking advantage of Musti's leadership position, with a very strong value proposition for consumers in these geographies. We will be able to bring our assets and our capabilities to the table to help drive that, that story into the future. If I may now touch upon the key terms of the offer, I will be brief. This is naturally a voluntary offer launched by this consortium.
The price which we have offered is EUR 26 per share in cash to Musti shareholders, which represents a premium of 27% over the closing price yesterday, and 40% over the 6 months average on the average as with reference to yesterday as well. So this offer values Musti's enterprise value at EUR 1 billion, implying an EV to adjusted EBITDA multiple of 12x, and an equity value for 100% of Musti of EUR 868 million. We naturally have the supports of Musti's independent committee of the board of directors.
We have been discussing this offer with them, and they have decided to recommend our offer to shareholders to tender in their shares based on the analysis that the independent committee has done, which takes into account two fairness opinions from reputable institutions. So we believe this is an attractive opportunity for current investors in the share while being as well a very attractive opportunity for Sonae to then take the company again to the future and continue to generate value in years to come. We expect the offer to be launched until the end of the year after we obtain the required regulatory approvals. And if everything goes according to plan, transaction settlements is expected to occur during the first quarter of 2024.
Finally, this is the envisaged transaction structure or corporate structure post offer. So fairly simple. So we have a consortium which is composed of Sonae and the three individuals I spoke about. The three people that are in the consortium, they are rolling over shares into the BidCo, where they will hold around 2% equity. Sonae will hold the remaining 98%, and we are making an offer for 100% of the company with a success condition of 90% acceptance, plus one share to be able to take the company private, which is the setting which we believe is the ideal one to drive value in the company in years to come. So this is in essence, in a nutshell, the rationale for the transaction, the transaction structure.
I am now available to answer any questions that you may have. You can please open the session to Q&A. Thank you.
Thank you. As a reminder, if you would like to ask questions, please press star one on your telephone keypad. To withdraw your question for any reason, you may press star two. You will be advised when to ask your question. Our first question comes from João Pinto with JB Capital. Please go ahead.
Yes, thank you very much for taking my questions. Hi, everyone. The first one, do you see risks to your dividend policy following this investment? The second one on the growth plans for these assets. The market shares in the existing markets seem high. Do you see still space to grow in the Nordics, or do we expect growth? Do you expect to expand the business to other countries? And related to this, how's the spare production capacity of this company? Will you have to invest more in production capacity, or do you have still space to incorporate higher demand? And finally, what kind of synergies can you explore with food retail platform that you have in Portugal, besides the loyalty programs know-how that you mentioned?
Thank you.
Thank you, João. Thank you for all the questions. I will try to answer all of them in turn. So starting with risks to dividend policy, the answer there is quite clear. We see no risks to our current dividend policy. With—as you know, Sonae has a very strong financial situation. We have the lowest level of leverage in our history, and we have a very strong balance sheet. This acquisition, although it is a significant amount, obviously, and it is of a significant importance for us, it will not endanger our dividend policy at all. Second question on growth plans. Yes, we still see a lot of growth potential in the Nordics.
As I said before, there's a number of drivers that we can pull to continue to grow in the core regions where the company operates right now. Part of it is continuing to grow, obviously, with the market. And so as you saw, the market is expected to continue to grow at a 5% like for like growth rate on average in the next few years, in all three markets. We obviously want to be exposed to that, but also increase the market share of the company, given its superior value proposition. We see excellent opportunities to continue to expand the store network, as I said before, namely in Sweden and Norway, where there are clear white spaces identified by the company, and there's still a lot of potential to grow the footprint that the company has.
Online is also a growth driver, so we continue to see a lot of potential to grow online, not also in the omnichannel brands, but also in the pure play brands that the company owns. And also services that I mentioned before, there's still a lot of potential to continue to increase the services parts of the business, which is revenue accretive, but it's also loyalty accretive, and it helps enlarge the share of wallet of customers in Musti. So there are a lot of opportunities to continue to grow in the Nordics market. If you ask me if there... We see opportunities to expand outside the Nordics? Potentially, yes.
So we believe that the company has a very strong and unique value proposition, which is based on a very distinctive retail concept with own and exclusive brands, which are also, I mean, quite unique in all the concepts that we've studied around the world, really. We see that the expertise and the capabilities that the management team has in driving these concepts across different geographies in the Nordics can also be exported to other geographies. It's still too soon to tell which geographies those could be, but we definitely see potential for that, and that is a discussion that we need to have once the transaction goes through, and we are able to be in the driving seat of that discussion.
In terms of production capacity, yes, the company still has available production capacity in its current plant. Its own and exclusive brands are composed of both products, which are produced in the company's own facilities, but also products which are produced by other manufacturers. But in the company's own production facility, there is still significant expansion potential. So there are no constraints there, and there is no significant CapEx necessary to significantly expand production capacity. In terms of synergies, I think there are several synergies that we can drive in this business, and I'm not talking about cost synergies, right? So I'm talking about value that Sonae can bring to help Musti in its next development stage.
This has a lot to do with our retail expertise, with our operational expertise, with the fact that we have been able to optimize large scale retail operations in different geographies, in topics regarding logistics, operations, own label production and supply, loyalty. And so there's a number of areas where we will definitely be able to add a lot of value, and that's what we want to do. So we want to help the company grow even further into the future. But specifically with the food retail division, there might be opportunities to have some linkages, obviously, given the expertise that the company has in pet care retail. So we are really talking about leading edge specialists in this area.
And so we stand a lot to learn at MC from Musti, and so there are clearly opportunities that we can tap into going into the future. But I think it's too soon at this point in time to be very specific.
That's very clear. Thank you very much.
Thank you, João.
Thank you. Our next question comes from José Rito of CaixaBank. Please go ahead.
Yes, hi. Hello, good afternoon.
Hi, José .
So, I will share some of the concerns or the questions that some of the investors has been raising. One of these questions is: What will Sonae add to this business? So I think that you tried to explain that you see a lot of synergies, both in terms of logistics and things like that, but how relevant is this? So in the implied multiple that you paid, what can Sonae add that eventually will be materialized in synergy, which will put these 12x EBITDA that you just mentioned at a lower level? So if you can provide a little bit some granularity on this will be great.
Because I think that, well, being mostly a listed company, I think that, this was a company that was more or less, known by the market. And, and, and for sure, you are seeing some potential that, that investors were not seeing on, on this Musti. And I also believe that, well, Musti have no balance sheet restriction, so I think that you are seeing that you can add something that eventually will extract further value from, from Musti. So this will be my, my first question. The second one, sorry, you mentioned the growth potential in, in the Nordics. I'm not sure if you explain also if you plan or not, just to clarify, to expand the business to other European countries, if this is something that you could consider in a, in the near future or not.
Finally, if you can consider that most of the investments at the Sonae level are done. What I mean is that we have this Druni deal in the short term. Now, Musti, should the focus lie on integrating and extracting value from these operations, or could you consider additional deals in the near future? That will be my questions. Thank you.
Thank you, José . So let me try to provide a little bit more color on some of the topics that you mentioned. On the first one, how can Sonae add value to Musti? I think I tried to answer that before, but maybe I'll... Let me just bring you another element into this. I think a key element that Sonae can bring to the table is our long-term focus on value creation and on the sustainability of value propositions of our businesses.
We believe that under a private context, with Sonae as the majority shareholder in the company, we can really accelerate growth in the company, and we can really make sure that the company can invest with a view to maximize value in the long term, without the restrictions of being under a listed setting, with a diversified shareholder base. And so this is something that we can definitely bring to the table.
It's something that we have discussed at length with management team, and this is something that we feel that together with them, given our long-term view, given our commitment, and also given all the expertise that we can bring to the table on some of the key challenges that the company is facing at this point in time to grow the business. This is definitely where we feel that Sonae can add value. And I touched on a number of levers where the experience that we have in scaling up retail businesses in different geographies, in different areas, will be instrumental and will help the management team continue to grow the business with a more accelerated view. Obviously, it's the only path forward, is if we can justify an accelerated level of growth.
Obviously, the company has been growing well in the last few years, but we believe that we can further accelerate the company's growth in the next few years with the very strong elements that the company has been able to deploy over the recent past, but building on that to bring it to a new level of performance. If we plan to expand to other countries, again, as I told, answering Joel's question, the focus is the Nordics, and so we are very focused on making sure that the company continues to win in the Nordics, which is obviously its core geography. And our main concern is to serve our customers in those markets to the best of the ability that the company can. And so this is a key.
I mean, we have a number of very loyal customers that expect high standards from Musti and always expect innovation and new products and, and, and a very distinctive value proposition, and that, that has to be the priority. But yes, we see potential for the company to expand into other geographies, given the analysis that we've done of different countries in Europe, the competitive landscape that we see in different countries. And so the answer to that question is yes, it's still too soon to have a deep discussion on that, but the idea is for the company to continue to grow also outside of the Nordics. The third question was on, remind me? Additional investments.
Yeah, yes, yes.
If we plan to do additional investments outside the current portfolio, is that it?
Not necessarily outside. So basically, this has been a question on investors after the minority stake, the sale of the minority stake in Sonae MC, and the proceeds received, and the recent proceeds that you-
Mm-hmm
... that you receive, and is expected to receive in, in Q4. But, well, what will be the investments that you were planning? So-
Yeah
... kind of some reinvestment risks-
Yeah
... that was the main question and worry from investors. So the question is-
Yeah
... well, now that you have these two relevant operations, if the focus will be on these and not necessarily looking into further deals?
It's a very fair question, and I will try to give a very straight answer. So the if we are able to execute this transaction as we wish, I don't see room in the short term for an additional large-sized investment for Sonae. So what I see is Sonae continuing to invest in its current business units. As we know, we have a number of growth business units right now in the portfolio, such as Bright Pixel, also SparkFood that we launched, where we will continue to look at potential investment options.
And if we are able to execute this operation, and we are very excited and with a very strong will to execute this transaction, I feel that this will leave us in a good place in terms of where we want to be in the short term, in terms of diversification, portfolio structure, and path to grow into the future. And I would add to this also the health and wellness and beauty segment, which you mentioned before, which is a very recent investment and announcement where we also have great expectations in terms of growth and international growth in particular.
Mm-hmm. Understand. Thank you.
Thank you, sir.
Thank you. As a reminder, if you would like to ask a question on today's call, you may press star one on your telephone keypad. Our next question comes from António Seladas of AS Independent Research. Please go ahead.
Hi, good afternoon. Thank you for the presentation, and thank you for taking my questions. So first one is related, and you mentioned that Sonae MC already have some operations on pet care. So my question is, why you didn't do the operations through Sonae MC? This is the first one. Second one is related with growth. Sales growth in 2023 were below double digits, 8.5% or 8.7%, so there were some slow down. Apparently, growth was mainly from prices, so, there's no concerns or there will be concerns about just the market being saturated and growth rates come down. And the last question is related with some problems with some pets. So, pet food caused some pets falling ill.
I think that is a problem over the last two or three weeks. Apparently, the company is not concerned. Nevertheless, we don't know exactly, from my understanding, we don't know exactly what are the outcome of all this, this situation. I don't know if you want to... So if you can explain and what we expect about it. Thank you very much.
Thank you, António. So first question, why did we not consider do this, to do this through, MC? I mean, this is a very sizable investment. It's an international investment, in, in, in a company, where we see a great potential, again, to continue to, to grow. It, it is not the core focus of MC's strategy at this point in time to grow internationally in pet care, retail. Obviously, MC has an important pet, pet care retail presence, in Portugal, given the fact that it sells pet food inside supermarkets, and it also has ZU stores in adjacency to supermarkets where, where, where it sells an extended range, which is not allowed to be sold inside supermarkets.
But this, it's a very focused approach to pet care and pet food, and it's not part of the core strategy of MC. MC has very important opportunities and challenges to face in the next few years, and we didn't want to distract the MC management team from these challenges. And as you know, we have partnered with Musti's CEO and two board members, and so our partnership with Jeff, Johan, and David is a very strong one, and we trust in them to manage the company and help us grow the company in years to come. So this is why we decided to take an independent view on this investment and execute this at the corporate level and not within MC.
That doesn't mean that we will not be able to extract linkages and synergies between MC and Musti. We very much want to do it, and we feel there are benefits for both companies in doing it, but we prefer to run it as a sizable independent investment within our portfolio. In terms of recent growth, it's you're right that growth in 2023 was slightly below recent years. I mean, the company is public, so there's a lot of information that the company has published about its recent performance, and you can get much more information than the one that I can convey to you shortly in this call.
But this has to do with a number of drivers, namely, the fact that there was some currency impact in terms of sales in Sweden, where there was an unfavorable exchange rate evolution. Last year, the year before, we still had a lot of, I would say, hangover impact from COVID. And also there were some categories that had a better performance than others, and particularly in some discretionary spending, there was a slight decrease this year, which is not expected to remain in the next few months.
There are a number of different drivers, but overall growth in the company has been quite solid, quite strong, and also we've seen a very significant increase in profitability, namely an increase in gross margin, which is obviously very good news for the company. In terms of the pet food incident that you mentioned, it's true, there was an incident, there was a product recall a few weeks ago. It was a product recall of a couple of SKUs that the company sells. Unfortunately, this happened. The root cause of that incident was already well identified and announced by the company to the market. The company, the management team did a great job in acting very quickly on it.
So the root cause for this pet food incident was an ingredient that was imported into Finland to produce a couple of SKUs of their own label range. These are products that account for a very, very low level of sales. But they had an impact on pets, which was obviously a huge concern for the management team. But the management team has done everything in its power to reach out to consumers, to take care of the consumers that were affected, and to understand the root cause of it. It has, as I said, been communicated to the market. Fortunately, the issue was contained. The company recalled the SKUs that were affected by these products.
Now the situation has already been normalized, both in terms of sales and also in terms of reputational issues for the company. So we are very confident that the company, the management team did a great job in acting on this incident. It was unfortunate, obviously, but the company did a really good job and is now already on a regular level of performance, and the company continues to be well-regarded by consumers in its journey.
Just a final question related with the working capital. It's positive, so it's not exactly as a retail chain at work. So it means that the plants and the stores and the plants just sell the products on its own stores, as far as I understood, and of course, they have their own plants. Is that right?
No, but they also... It's a production facility which they used to own, close to a 50% stake together with a partner. They acquired the remaining partner's stake very recently. It's an independent production plant that produces mainly for the products that are sold exclusively at Musti stores, but they also sell products to other customers. And so it's not exclusive production for Musti.
Okay. Okay, thank you very much.
Thank you.
Thank you. As we have no further questions in the audio queue, I'd like to turn it off for any further questions from the webcast.
Thank you. So we have a number of questions here that I will try to answer. Maybe there's a question on how Sonae will finance this transaction. And if this financing will imply a very leveraged balance sheet going forward. So the operation will be financed by a mix of debt and own funds, namely the proceeds from the sale of our participation in ISRG. As you know, we just realized EUR 300 million in cash proceeds with the sale of our stake in ISRG to JD Sports. So that's going to be an important element in terms of the funding of the transaction. The debt portion has been fully underwritten by two of our closest relationship banks, CaixaBank BPI and Santander.
And then the financing is expected to be syndicated to other relationship banks in weeks to come. And so this is how we are financing the transaction. If this will imply a very leveraged balance sheet ahead? The answer is no. And so, as you know, Sonae takes a very conservative view to leverage. Obviously, if we execute this transaction, our level of leverage will increase in absolute term, and in the short term. But as you know, we have a very low level of leverage currently. We will end the year probably with a positive cash position at the holding level. And so it, this is something that we that is well within our ability to fund without leveraging too much the company.
We expect our loan to value to reach probably around our threshold of 15% at this point in time after we execute the transaction. But then we expect the company to continue to deleverage in years to come, given the cash generative profile of our businesses. So, we are quite confident that this will not leverage the company significantly above where we are today. Let me see other questions. How do we think about the current small ownership level from the bidding consortium? Is there a strong confidence that the other shareholders will accept the bid? So yes, we have a strong level of confidence that the other shareholders will accept the bid. As I said, we feel that our offer is an attractive offer.
It represents a quite significant premium over the recent trading of the share. The board has looked into this, the independent committee of the board has looked into this. Obviously, the board has done a good job negotiating a deal on behalf of shareholders, which brought us to the current price level in the offer. It has been supported by two fairness opinions from, again, reputed investment banks. We feel that this is a very attractive offer for current shareholders. We feel that the acceptance level will be high. At least that's our expectation, given the offer that we put on the table. Let me see if we have more questions.
When do you expect to formally notify this deal to the European Commission? Yes, we expect to notify this very quickly in the next few weeks. We do not expect any remedies or any challenges in terms of antitrust, given that this is a completely different market from the ones we currently operate in. So we expect this to be a quite smooth process. How did this transaction come about? Was mostly running a process. No. So this transaction came about. I mean, we were looking at the sector for quite some time. We were studying the sector. We did a very thorough job of analyzing different markets and different players. We actually decided to invest in Musti in the public equity markets.
So we built a small minority position in the company. And we then basically tapped into this opportunity, given the investment that we did and the knowledge that we gained from the company. So there was not a process running. So this is something that we eventually decided to do with the three members of the consortium after having done a lot of work on the company. So what could be the expected growth in terms of revenues and EBITDA for the coming years, above 5% or above 10%? Look, it's too soon for me. I mean, we don't give guidance for Sonae, as you know, so much less for a company that we do not currently own. We are optimistic on the growth potential of the company.
The company has, itself, has given guidance to the market, which is public. And as I said before, our expectation is that we can boost that level of performance even further beyond the guidance that the company has given to the market recently. I think there are a few more questions that I answered already in terms of of regulatory approvals. So I think... I mean, I think I've practically covered most of the questions that I see on on the chat here. So I would just like to if there are no more questions from anyone on the call, I would like to reiterate that this is an opportunity that we are very excited about. We are very excited about the prospect of partnering with Jeff, Johan, and David, and make this acquisition a, a reality.
A transaction, which again, we feel, is going to be attractive for current shareholders at the current price. An offer, which obviously will enable Sonae to have a new piece in its portfolio, a new asset in its portfolio, which will enable us to achieve our growth, internationalization, profitability, and financial strength objectives with a wider reach than the one that we have today. So we are very happy to be announcing this transaction and very much looking forward to the next few weeks, and to be executing this and driving the company in years to come. Thank you very much for listening. Thank you very much for your questions, and speak soon to all of you. Bye-bye.
Thank you very much. That concludes today's conference. You may now disconnect.