December 15th, 2021 | 13:24 CET
United Internet, BrainChip, Software AG - Promising further growth!
Growth strategy and the use of innovative technologies are often decisive for the continued existence of a company. Not only in large corporations, as seen in the example of SAP with the expansion of the cloud business, but the conventional business areas are also hardly sufficient anymore. A generation change is also taking place in the production of semiconductors. The market for chips for artificial intelligence is currently experiencing a real hype, which is likely to accelerate in the coming years. Smaller companies, in particular, have a head start in terms of know-how.
time to read: 3 minutes
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Author:
Carsten Mainitz
ISIN:
BRAINCHIP HOLDINGS LTD | AU000000BRN8 , SOFTWARE AG NA O.N. | DE000A2GS401 , UTD.INTERNET AG NA | DE0005089031
Table of contents:
Author
Carsten Mainitz
The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.
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BrainChip Holdings - Sensational cooperation
The blown-up supply chains caused delays and production stoppages in many industries throughout the year. In addition to the entertainment industry, automakers such as Volkswagen were hit hard, forcing them to put workers on short-time work and shut down entire production lines in the interim. According to industry experts, this trend is unlikely to end before 2023. In contrast, a growth boom is emerging for intelligent chips in the coming years. According to market research institute Gartner, revenue in this segment was USD 13.5 billion worldwide in 2019 and is expected to more than quintuple to USD 72.7 billion by 2025.
Around 100 startups worldwide are working to break through and commercialize their chip. With a stock market value of the equivalent of EUR 715 million, Australian Company with US-Base BrainChip Holdings is in the process of developing what CFO Ken Scarince calls "the most efficient AI solution ever produced." The Akida chip is high-performance, small, with ultra-low power consumption, and enables a wide range of edge functions such as on-chip training, learning and reasoning.
BrainChip's neural network processor operates on a pulse- and event-based basis, mimicking the human brain. As a result, the technology is ideally suited for modern edge devices and is expected to be used in autonomous driving, IoT devices, robotics, medical diagnostics and security technology. A first generation of the innovative chips has already been produced.
The next generation of AI-powered chips will be developed with Mega Chips - a Japanese billion-dollar corporation focused on automotive and industrial equipment growth, such as 5G communications infrastructure and factory automation. BrainChip's management sees the cooperation as an opportunity to "offer unprecedented products."
United Internet - Positive signs
United Internet CEO Ralph Dommermuth's announcement of an increase in his share position provides a further tailwind for the share price. The MDAX group reports that the review and negotiation will take a few days. Dommermuth has not yet decided on either a block acquisition or the submission or rejection of a top-up offer. The decision would depend, among other things, on the financing, the outcome of the review and negotiation of the offers and the further development of the capital market. The CEO is examining whether to submit a voluntary purchase offer for 17 million United Internet shares at EUR 35 each via an existing company or a new company to be founded under his control. The shareholding in United Internet controlled by him would thus increase to around 51%.
The United Internet share price has gained more than 10% since the beginning of the week and currently stands at just under EUR 35, the same level as the possible purchase offer. The analysts at Hauck & Aufhäuser reiterated their buy recommendation with a target price of EUR 40.
Software AG - Takeover fantasy faded away
In contrast, Software AG's share price fell by double digits. After the fantasy of a complete takeover by financial investors was played out in recent weeks, only a strategic investment by the investor Silver Lake, which focuses on technology companies, is coming to fruition.
Accordingly, the US investor is to subscribe to convertible bonds of Software AG for EUR 344 million, representing approximately 10% of the currently issued share capital. The investment is part of a strategic partnership to accelerate growth.
Due to the entry of Silver Lake, the major Swiss bank UBS reiterated its Buy rating with a price target of EUR 44.50. Thus, the newly raised money could be used for possible acquisitions. The chip shortage is burdening several sectors across the board, and there is no sign of an end to the shortage next year. The market for AI-powered chips is growing dynamically. BrainChip Holdings believes that its partnership will enable it to manufacture unique products. At United Internet, the fantasy is fueled by possible insider purchases. By contrast, the fantasy at Software AG has faded.
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