D'Ieteren: the market values Belron at ~11x EBITDA, but the €32bn number everyone quotes is weaker evidence than it looks

\*\*TL;DR\*\* \- At €169, D'Ieteren's price implies Belron (Carglass/Safelite) is worth about 10–11x EBITDA. At 14x, D'Ieteren's 50.3% stake alone would be worth more than the whole share price. \- The famous €32.2bn Belron valuation (Oct 2024) came from minority holders buying an extra \*\*1.4%\*\* from another minority holder. That's a thin data point, not a market price. \- Belron's job volumes are essentially flat (+0.4% in H1 2026 ex-recalibrations). Growth comes from pricing and ADAS complexity. It's a great business, but not a volume compounder. \- My conclusion: the stub is real, but the holding discount will probably persist even after a listing. I hold, I'm not adding, and I'd buy again below \~€140. \--- \*\*The puzzle\*\* Belron's adjusted operating profit went from €1,017m (2022) to €1,536m (2025), up about 50%. D'Ieteren's share price is roughly flat over the same three years. Something isn't transmitting. I looked at three possible explanations and tested each against the company's own documents (H1-2026 interim report, earnings call transcript, FY-2023/2025 results, press releases): 1. Belron is worth less than people think. 2. Belron's value leaks before it reaches D'Ieteren shareholders (holding discount, capital allocation). 3. The market is simply mispricing it. \*\*Test 1: what the price implies\*\* \- Market cap ≈ €8.8bn (52.26m shares outstanding after treasury shares). \- Everything except Belron (PHE after \~€501m of minority put liabilities, 40% of TVH, the car distribution arm, Moleskine, property, holdco debt): my estimate is €40–60/share. \- That leaves roughly €110–130/share for 50.3% of Belron. \- Add Belron's €8.34bn net debt and the implied enterprise value is about €20–22bn. On LTM EBITDA of \~€1.9bn, that's 10–11x. | Belron EV | \~EV/EBITDA | D'Ieteren's stake per share | |---|---|---| | €21bn | \~11x | \~€122 | | €26.6bn | 14x | \~€176 | | €30bn | \~16x | \~€208 | | €32.2bn | \~17x | \~€230 | \*\*Test 2: where the €32.2bn comes from\*\* Per D'Ieteren's own press release (30 Oct 2024), existing minority shareholders (CD&R, H&F, GIC, BlackRock) bought an additional 1.4% from Atessa, another minority holder, at €23.5bn equity / €32.2bn EV. These buyers already owned \~40%, so a high price on the extra slice also marked up what they already held. On my estimate it was roughly 20x trailing EBITDA. It was real money, but it was one small inside transaction. I wouldn't anchor a thesis on it. \*\*Test 3: what Belron's growth is made of\*\* | | 2023 | 2025 | H1 2026 | |---|---|---|---| | Windshield job growth | +2.1% | +0.5% | +0.4%\* | | Replacements with ADAS recalibration | 36.4% | 47.2% | 52.1% | | Adj. operating margin | 20.5% | 23.0% | 23.0% | \*Excludes recalibrations, as stated by management on the H1 call. Price/mix was about 7% in H1, helped in the US by the NAGS benchmark price list (which the CFO called a "black box"). So this is a toll road with flat traffic and rising tolls. That's excellent economics: FCF was €485m in H1, up 89%. But recalibration penetration can't go above 100%. This argues that 20x is generous and 10–11x is harsh. \*\*Test 4: who wants the IPO\*\* On the H1 call, the outgoing CEO explained the timing: he'd always said things would move "when someone knocks on the door", and now they're exploring options. The initiative came from the minorities (PE and institutions wanting liquidity). A seller-driven listing gets priced to clear, so I'd expect below €32bn, not above. Even so, a cautious IPO at 14–15x would put a public price on Belron far above what DIE's stock implies today. \*\*Test 5: where the holdco's cash goes\*\* \- Good: a €100m buyback, with €60.6m spent at an average of \~€172. That's buying assets at roughly a 25% discount. \- Less good: PHE minority put liabilities rose from €315m to €501m in six months after the Spanish acquisitions. \- Moleskine: the holdco forgave a €76m loan in H1, and the CFO said more waivers could follow under Italian rules. \- The car distribution arm: margin down to 2.1%, contribution down 67%, up to 344 job cuts announced. None of this is large relative to Belron's cash flow, but it's the pattern you'd expect if value leaks. \*\*Where I land\*\* Belron is worth more than 11x, probably closer to 14–15x than 20x, and the holding discount likely persists after a listing. My base-case NAV is \~€226/share, so DIE trades at roughly a 25% discount. If NAV compounds around 9% a year and the discount stays at 25%, that's about 10% a year over ten years. Solid, but not the windfall the €32bn headline implies. The real long-term risk is Belron's pricing power fading, not the discount. \*\*What would change my mind:\*\* an IPO at €28bn+ EV; D'Ieteren selling part of its stake (versus levering up to buy out the minorities at a high price); Belron job volumes turning negative for two halves; the discount staying ≥25% six months after a listing. \*\*Questions for you:\*\* \- Is anyone modelling a leveraged buyout of the minorities by D'Ieteren as a real scenario? \- What multiple would you put on a flat-volume, pricing-driven 23%-margin business? \*Disclosure: I own DIE shares. Not investment advice. Figures are from D'Ieteren's reports and the H1-2026 call; valuations and weights are my own estimates.\*