Kone

Q1 results were broadly in line with a largely unchanged 2026 outlook (all details available on the website). 

More importantly, the company announced the TK elevator deal for EUR29.4bn paid in cash (EUR5bn) and in shares: 270m new Kone shares. Deal at 22x EBIT, which is slightly higher than Kone's current valuation ratio (21x EV/EBIT26). 

The combined group would have EUR20.5bn in combined sales, and synergies are expected to reach EUR700m on an annual run rate. 

Schindler already said they would oppose the deal for antitrust issues. 

Expert Opinion:
We don't like the deal which is expensive and is a risky execution play. Legal battle is likely to be a drag on the name. Bear in lmind that most mega deals are value destroying no matter how much synergies are expected to be generated before the integration. 

In that scenario, we reiterate our preference for Schindler, which, in any case, would also benefit from the consolidation in the sector and likely ensuing price increase. Schindler CMD on June 3rd when they will provide details on capital allocation. 


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