Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Canvest Environmental Protection Group / Event-Driven

Canvest Environmental Protection Group (0XC SW)

<ul>
<li>After SAFE<a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2025/0219/2025021900847.pdf" target="_blank" rel="noopener"> gave the green light</a> on the 19th Feb, I estimated only a week was required to secure the (strangely) outstanding internal guarantees. It took a frustrating three-and-a-half weeks.</li>
<li>Nevertheless, all pre-cons are now done. <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental (1381 HK)</a>'s Scheme Document is expected to be dispatched or before the 25th April. </li>
<li>Assuming the Scheme gets up - and it will - expect payment around the 20th June. This is done.</li>
</ul>


After SAFE gave the green light on the 19th Feb, I estimated only a week was required to secure the (strangely) outstanding internal guarantees. It took a frustrating three-and-a-half weeks.
Nevertheless, all pre-cons are now done. Canvest Environmental (1381 HK)'s Scheme Document is expected to be dispatched or before the 25th April. 
Assuming the Scheme gets up - and it will - expect payment around the 20th June. This is done.


<ul>
<li>After <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental Protection Group (1381 HK)</a> announced on the 23rd Jan it had secured <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2025/0123/2025012301266.pdf" target="_blank" rel="noopener">Mofcom approval</a>, after securing NDRC earlier that month, that left SAFE. Or so I thought. 
</li>
<li>SAFE has now been secured, yet two pre-cons concerning certain (internal) guarantees remain outstanding. It's rare to see SAFE sign off with other pre-cons still hanging. </li>
<li>The consolation here is that KM Lai (ED, DC) and Loretta Lee (ED, CL) are on the hook for a chunk of change if they cause the proposal to lapse.</li>
</ul>


After Canvest Environmental Protection Group (1381 HK) announced on the 23rd Jan it had secured Mofcom approval, after securing NDRC earlier that month, that left SAFE. Or so I thought. 

SAFE has now been secured, yet two pre-cons concerning certain (internal) guarantees remain outstanding. It's rare to see SAFE sign off with other pre-cons still hanging. 
The consolation here is that KM Lai (ED, DC) and Loretta Lee (ED, CL) are on the hook for a chunk of change if they cause the proposal to lapse.


Canvest (1381 HK): SAFE In The Bag, But Oddly, Still Not Free From Pre-Cons

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.

<ul>
<li>The regulatory precondition concerning <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental Protection Group (1381 HK)</a>’s privatisation offer from <a href="https://www.smartkarma.com/entities/grandblue-environment-co-a" target="_blank" data-smartkarma-citation="entities:17887:1" rel="noopener">Grandblue Environment Co A (600323 CH)</a> has been satisfied. </li>
<li>The sole remaining precondition concerns resolving loan guarantee issues. Canvest is taking steps to resolve these issues, and satisfying this precondition is low-risk. </li>
<li>Despite peers' re-rating, the offer remains attractive, and the vote is low-risk. At the last close, the gross/annualised spread was 4.5%/15.0% for a mid-June payment. </li>
</ul>


The regulatory precondition concerning Canvest Environmental Protection Group (1381 HK)’s privatisation offer from Grandblue Environment Co A (600323 CH) has been satisfied. 
The sole remaining precondition concerns resolving loan guarantee issues. Canvest is taking steps to resolve these issues, and satisfying this precondition is low-risk. 
Despite peers' re-rating, the offer remains attractive, and the vote is low-risk. At the last close, the gross/annualised spread was 4.5%/15.0% for a mid-June payment. 


Canvest (1381 HK): Regulatory Precondition Satisfied

<ul>
<li>
<a href="https://www.smartkarma.com/entities/grandblue-environment-co-a" target="_blank" data-smartkarma-citation="entities:17887:1" rel="noopener">Grandblue Environment Co A (600323 CH)</a> continues to make steady progress in satisfying the precondition for its HK$4.90 privatisation offer for <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental Protection Group (1381 HK)</a>. </li>
<li>Two of the five preconditions are satisfied, and another will be satisfied by 20 January. The long stop date of 17 July provides ample time to satisfy the remaining two. </li>
<li>Although the peers have materially re-rated, the offer implies a premium compared to peer multiples. Vote risk remains low, aided by selling by a shareholder with a blocking stake. </li>
</ul>



Grandblue Environment Co A (600323 CH) continues to make steady progress in satisfying the precondition for its HK$4.90 privatisation offer for Canvest Environmental Protection Group (1381 HK). 
Two of the five preconditions are satisfied, and another will be satisfied by 20 January. The long stop date of 17 July provides ample time to satisfy the remaining two. 
Although the peers have materially re-rated, the offer implies a premium compared to peer multiples. Vote risk remains low, aided by selling by a shareholder with a blocking stake. 


Canvest (1381 HK): Attractive Spread with Steady Progress in Precondition Satisfaction

<ul>
<li>Back on the 22 July, waste-to-energy play <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental (1381 HK)</a> announced a pre-conditional Offer from <a href="https://www.smartkarma.com/entities/grandblue-environment-co-a" target="_blank" data-smartkarma-citation="entities:17887:1" rel="noopener">Grandblue Environment (600323 CH)</a> at $4.90/share (best &amp; final), by way of a Scheme.</li>
<li>PRC anti-monopoly law and SAMR approvals were secured ~2.5 months from the Offer announcement. MoC, NDRC, SAMR and SAFE approvals remain outstanding. The pre-con long-stop is the 17th July 2025.</li>
<li>The transaction appears on track. However, Canvest's gross spread has widened 6.4% - out to 13.4% as I type - since <a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">China Traditional Chinese Medicine (570 HK)</a> blew up. That's excessive.</li>
</ul>


Back on the 22 July, waste-to-energy play Canvest Environmental (1381 HK) announced a pre-conditional Offer from Grandblue Environment (600323 CH) at $4.90/share (best &amp; final), by way of a Scheme.
PRC anti-monopoly law and SAMR approvals were secured ~2.5 months from the Offer announcement. MoC, NDRC, SAMR and SAFE approvals remain outstanding. The pre-con long-stop is the 17th July 2025.
The transaction appears on track. However, Canvest's gross spread has widened 6.4% - out to 13.4% as I type - since China Traditional Chinese Medicine (570 HK) blew up. That's excessive.


Canvest (1381 HK): This Is Trading Too Wide

Hong Kong

Shanghai Industrial is a diversified conglomerate operating in real estate, infrastructure, consumer products, and comprehensive healthcare. Its infrastructure segment includes investments in toll roads, bridges, water services, and clean energy, while consumer products cover tobacco, packaging materials, and printed products. The company was incorporated in Hong Kong in 1996 and is headquartered there.

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Shanghai Industrial (363 HK)

Canvest (1381 HK): Get Involved

Trading at a 2.9%/11.9% gross/annualised spread, assuming payment around the 20th June. Get involved here and on weakness.

David Blennerhassett

Canvest (1381 HK): SAFE In The Bag, But Oddly, Still Not Free From Pre-Cons

Pre-cons should be wrapped up shortly, -expect payment late May. This is trading at a 4.5%/19% gross/annualised spread. Get involved - unless you...

David Blennerhassett

Canvest (1381 HK): Regulatory Precondition Satisfied

Satisfying the remaining precondition is low risk. The offer remains attractive, and the vote is low-risk. At the last close, the gross/annualised...

Arun George

Canvest (1381 HK): Attractive Spread with Steady Progress in Precondition Satisfaction

Grandblue continues to progress toward satisfying the precondition, having secured NDRC approval. The remaining regulatory approvals required are...

Arun George

Canvest (1381 HK): This Is Trading Too Wide

After TCM, arbitrageurs don't have the risk appetite to be hit with a double whammy before year-end. However, Canvest's approval process is more...

David Blennerhassett

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