IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

ITOCHU-SHOKUHIN Co., Ltd. is a wholesaler of alcoholic beverages, general foods, and frozen foods.  The Company's products include beer, sake, distilled spirits, seasonings, canned goods, noodles, dried foodstuffs, confectionery, and processed foods.  Itochu-Shokuhin also plans, develops, and sells gift products.

<ul>
<li>On 14 November, media outlets reported that Sapphireterra has <a href="https://img1.wsimg.com/blobby/go/e7ddad68-3d70-4201-b3f3-16f665298127/downloads/055ae6dd-96a9-457f-baab-01eafcc12759/STC%20IS%20Press%20Release%202025-11-05%20E%20FINAL.pdf?ver=1763150335833" target="_blank" rel="noopener">sent a letter</a> to the <a href="https://www.smartkarma.com/entities/itochu-shokuhin-co-ltd" target="_blank" data-smartkarma-citation="entities:14985:1" rel="noopener">Itochu Shokuhin (2692 JP)</a> Board suggesting two strategic alternatives to improve shareholder returns. </li>
<li>Sapphireterra has suggested that <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> privatise Itochu-Shokuhin at JPY14,000, a 50.5% takeover premium. Due to the shareholder structure, Itochu does not need to be this generous.</li>
<li>Sapphireterra has also alternatively suggested JPY7,000 special dividend. The strong YTD share performance suggests no pressing need for the Board to act on this proposal. </li>
</ul>


On 14 November, media outlets reported that Sapphireterra has sent a letter to the Itochu Shokuhin (2692 JP) Board suggesting two strategic alternatives to improve shareholder returns. 
Sapphireterra has suggested that Itochu Corp (8001 JP) privatise Itochu-Shokuhin at JPY14,000, a 50.5% takeover premium. Due to the shareholder structure, Itochu does not need to be this generous.
Sapphireterra has also alternatively suggested JPY7,000 special dividend. The strong YTD share performance suggests no pressing need for the Board to act on this proposal. 


Itochu-Shokuhin (2692 JP): Itochu Likely to Shrug off Sapphireterra’s Privatisation Call

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

ENN Energy Holdings Ltd. distributes natural gas in China.  The Company, through its subsidiaries, invests in, operates, and manages gas pipelines, and sells and distributes piped and bottled gas in China.

<ul>
<li>We now expect the privatisation of <a href="https://www.smartkarma.com/entities/enn-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:316:1" rel="noopener">ENN Energy (2688 HK)</a> to be completed by mid-2026, given that the pre-conditions are yet to be satisfied.</li>
<li>For 3Q25, the gas sales volume of ENN Energy has picked up. Meanwhile, net profit for ENN Natural Gas has also recovered. Both results are positive.</li>
<li>Incorporating our latest timetable estimate, EPS forecasts, and adjusted undisturbed PERs, ENN Energy is valued at HK$67.40-72.16, meaning the share price is at 0.4% to 7% discount.</li>
</ul>


We now expect the privatisation of ENN Energy (2688 HK) to be completed by mid-2026, given that the pre-conditions are yet to be satisfied.
For 3Q25, the gas sales volume of ENN Energy has picked up. Meanwhile, net profit for ENN Natural Gas has also recovered. Both results are positive.
Incorporating our latest timetable estimate, EPS forecasts, and adjusted undisturbed PERs, ENN Energy is valued at HK$67.40-72.16, meaning the share price is at 0.4% to 7% discount.


ENN Energy (2688 HK): Our Latest Assessment Remains Positive

SCSK Corporation provides a variety of IT services including system solutions, software development, and data center and communication network management. The Company sells packaged software and network equipment and develops software for distribution, manufacturing, and financial systems among others.  SCSK handles infrastructure software as well.

<ul>
<li>Today, the <a href="https://www.nikkei.com/article/DGXZQOUC291X90Z21C25A0000000/" target="_blank" rel="noopener">Nikkei reported</a> that <a href="https://www.smartkarma.com/entities/sumitomo-corp" target="_blank" data-smartkarma-citation="entities:5380:1" rel="noopener">Sumitomo Corp (8053 JP)</a> plans to privatise <a href="https://www.smartkarma.com/entities/scsk-corp" target="_blank" data-smartkarma-citation="entities:19996:1" rel="noopener">Scsk Corp (9719 JP)</a> through a tender offer. Both shares were placed on a trading halt.</li>
<li>The Nikkei states that the total acquisition cost would be around JPY800 billion, based on an arbitrary assumption that the offer will be around 20% above the undisturbed price.</li>
<li>The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 is attractive compared to peer multiples and would represent an all-time high. </li>
</ul>


Today, the Nikkei reported that Sumitomo Corp (8053 JP) plans to privatise Scsk Corp (9719 JP) through a tender offer. Both shares were placed on a trading halt.
The Nikkei states that the total acquisition cost would be around JPY800 billion, based on an arbitrary assumption that the offer will be around 20% above the undisturbed price.
The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 is attractive compared to peer multiples and would represent an all-time high. 


SCSK Corp (9719 JP): Sumitomo (8053 JP)’s Rumoured Privatisation Offer

ANE (Cayman) Inc. operates as an integrated logistics company. The Company provides sorting, line-haul transportation, pickup and dispatch services, and other services. ANE (Cayman) offers services in China.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ane-cayman-inc" target="_blank" data-smartkarma-citation="entities:35025:1" rel="noopener">ANE Cayman Inc (9956 HK)</a> is on a halt “<em>pending the release of an announcement pursuant to the Code on Takeovers and Mergers which contains inside information of the Company.</em>” </li>
<li>I expect the halt is related to a potential privatisation bid from either a trade buyer, such as one of the Tongda operators, or an MBO sponsored by Centurium Capital.</li>
<li>I use several methods to triangulate the likely offer price, which suggests a range of HK$11.34-11.80 per share, with an average of HK$11.55, a 14% premium to the last close.</li>
</ul>



ANE Cayman Inc (9956 HK) is on a halt “pending the release of an announcement pursuant to the Code on Takeovers and Mergers which contains inside information of the Company.” 
I expect the halt is related to a potential privatisation bid from either a trade buyer, such as one of the Tongda operators, or an MBO sponsored by Centurium Capital.
I use several methods to triangulate the likely offer price, which suggests a range of HK$11.34-11.80 per share, with an average of HK$11.55, a 14% premium to the last close.


ANE Cayman (9956 HK): Trade Buyer or Centurium Capital to Launch a Privatisation Offer?

Hang Seng Bank Limited and its subsidiaries provide banking and related financial services.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hang-seng-bank-ltd" target="_blank" data-smartkarma-citation="entities:24:1" rel="noopener">Hang Seng Bank (11 HK)</a> announced a scheme privatisation offer from <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC Holdings (5 HK)</a> at HK$155, a 30.3% premium to the undisturbed price.  </li>
<li>Based on an estimated 2025 third dividend of HK$1.3 per share, the total consideration is HK$156.30 per share. The offer price is final.</li>
<li>The offer is attractive compared to peer multiples and historical trading ranges. At the current price and for a late March payment, the gross/annualised spread is 2.9%/6.2%.</li>
</ul>



Hang Seng Bank (11 HK) announced a scheme privatisation offer from HSBC Holdings (5 HK) at HK$155, a 30.3% premium to the undisturbed price.  
Based on an estimated 2025 third dividend of HK$1.3 per share, the total consideration is HK$156.30 per share. The offer price is final.
The offer is attractive compared to peer multiples and historical trading ranges. At the current price and for a late March payment, the gross/annualised spread is 2.9%/6.2%.


Hang Seng Bank (11 HK): HSBC (5 HK)’s Scheme Privatisation Is a Done Deal

Privatisations
Buy before they do

Itochu-Shokuhin (2692 JP): Itochu Likely to Shrug off Sapphireterra’s Privatisation Call

Sapphireterra has suggested two proposals (privatisation by Itochu, special divs) to improve shareholder returns. The Board is likely to react to...

Arun George

ENN Energy (2688 HK): Our Latest Assessment Remains Positive

ENN Energy's privatisation is expected to be completed by mid-2026. With positive gas sales volume and net profit for 3Q25, our updated valuation...

Osbert Tang, CFA

SCSK Corp (9719 JP): Sumitomo (8053 JP)’s Rumoured Privatisation Offer

The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 (JPY800 billion acquisition cost) is attractive compared to...

Arun George

ANE Cayman (9956 HK): Trade Buyer or Centurium Capital to Launch a Privatisation Offer?

On 17 September, the Board received a conditional privatisation proposal from Centurium Capital and Temasek. No price was disclosed. Nearly a month...

Arun George

Hang Seng Bank (11 HK): HSBC (5 HK)’s Scheme Privatisation Is a Done Deal

The offer is attractive compared to peer multiples and historical trading ranges. At the current price and for a late March payment, the gross...

Arun George