GBL is shifting its portfolio towards private investments Groupe Bruxelles Lambert (GBL), Pernod Ricard''s largest non-family shareholder with a c.6.8% equity stake (c.11.3% of voting rights), is in the midst of a strategic shift. With GBL shares trading at a material (c.40%) discount to NAV, the group intends to shift its portfolio toward private investments and increase cash returns to its shareholders, funded primarily by disposal of its listed assets. The recently appointed GBL Managing Director is a 25-year KKR / PE veteran In Mar-2025, Johannes Huth became the new MD of GBL. Mr. Huth has spent the last 25-years at KKR and our Div. Fins. team believe his arrival could accelerate the shift toward private investments. GBL anticipates EUR5bn of disposals between FY24-27 and has EUR2.6bn out of this remaining. Even a trimming of the Pernod Ricard stake could likely trigger market concern GBL''s Pernod Ricard stake (valued at c.EUR1.6bn) is its 2nd largest public investment and accounted for c.11% of the total GBL portfolio at the end of cal. Q125. GBL has already recently reduced its stakes in its #1 (SGS) and (then) #3 (Adidas) public holdings. At a time when structural questions hang over spirits / alcohol demand, we suspect even a trimming of the Pernod stake by a key long-term holder would be taken as a negative signal for the outlook for the business by the market. Any remaining stake would also potentially leave an overhang on the stock. GBL (+): funding dividend growth will require asset sale likely in listed stakes GBL has also committed to grow its DPS from a base of EUR5.0/s which according to our calculation should require further asset sale. This also supports the case for disposal of the most liquid stakes. Pernod Ricard (=): we continue to see catalysts as negatively skewed but the stock is cheap We continue to see a lack positive catalysts at Pernod Ricard and now elevated disposal risk from a long-term holder. However, the stock is...