Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>It's a fair bet Hancock Prospecting and <a href="https://www.smartkarma.com/entities/mineral-resources-ltd" target="_blank" data-smartkarma-citation="entities:15103:1" rel="noopener">Mineral Resources (MIN AU)</a> are actively discussing the final stages for <a href="https://www.smartkarma.com/entities/warrego-energy-ltd-082ab214-f4bb-4224-b321-8977486cd661" target="_blank" data-smartkarma-citation="entities:7808:1" rel="noopener">Warrego Energy (WGO AU)</a> behind the scenes.</li>
<li>It is unlikely MinRes aggressively builds a ~19% stake in a company subject to a two-way takeover battle, and declares its position "strategic" with no intention of making an Offer. </li>
<li>This stake may be a bargaining chip from MinRes to keep Hancock on the sidelines in its tilt for <a href="https://www.smartkarma.com/entities/norwest-energy-nl" target="_blank" data-smartkarma-citation="entities:1433:1" rel="noopener">Norwest Energy NL (NWE AU)</a>.</li>
</ul>


It's a fair bet Hancock Prospecting and Mineral Resources (MIN AU) are actively discussing the final stages for Warrego Energy (WGO AU) behind the scenes.
It is unlikely MinRes aggressively builds a ~19% stake in a company subject to a two-way takeover battle, and declares its position "strategic" with no intention of making an Offer. 
This stake may be a bargaining chip from MinRes to keep Hancock on the sidelines in its tilt for Norwest Energy NL (NWE AU).


<ul>
<li>Back on the 10 January, <a href="https://www.smartkarma.com/entities/norwest-energy-nl" target="_blank" data-smartkarma-citation="entities:1433:1" rel="noopener">Norwest Energy NL (NWE AU)</a> rejected <a href="https://www.smartkarma.com/entities/mineral-resources-ltd" target="_blank" data-smartkarma-citation="entities:15103:1" rel="noopener">Mineral Resources (MIN AU)</a>'s off-market scrip Offer.</li>
<li>It was apparent what MinRes needed to bump. This was an easy win if they do. On cue, they have now increased the scrip terms and NWE's directors are supportive. </li>
<li>Scrip terms are now 1 MinRes for every 1,300 NWE shares - from 1,367. I think NWE could have held out for more, but it is what it is. </li>
</ul>


Back on the 10 January, Norwest Energy NL (NWE AU) rejected Mineral Resources (MIN AU)'s off-market scrip Offer.
It was apparent what MinRes needed to bump. This was an easy win if they do. On cue, they have now increased the scrip terms and NWE's directors are supportive. 
Scrip terms are now 1 MinRes for every 1,300 NWE shares - from 1,367. I think NWE could have held out for more, but it is what it is. 


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>
<a href="https://www.smartkarma.com/entities/mineral-resources-ltd" target="_blank" data-smartkarma-citation="entities:15103:1" rel="noopener">Mineral Resources (MIN AU)</a> has revised its offer from 1 MinRes share for every 1,367 NWE shares to 1 MinRes share for every 1,300 NWE shares. The offer is unconditional. </li>
<li>The <a href="https://www.smartkarma.com/entities/norwest-energy-nl" target="_blank" data-smartkarma-citation="entities:1433:1" rel="noopener">Norwest Energy NL (NWE AU)</a> Board now recommends the offer. Most of the value uplift is due to the 17.4% increase in MinRes’ share price since 15 December.</li>
<li>MinRes’ revised off-market takeover offer is fair in comparison to <a href="https://www.smartkarma.com/entities/warrego-energy-ltd-082ab214-f4bb-4224-b321-8977486cd661" target="_blank" data-smartkarma-citation="entities:7808:1" rel="noopener">Warrego Energy (WGO AU)</a>’s bids and historical ranges. However, this is predicated on the MinRes maintaining its share price run.</li>
</ul>



Mineral Resources (MIN AU) has revised its offer from 1 MinRes share for every 1,367 NWE shares to 1 MinRes share for every 1,300 NWE shares. The offer is unconditional. 
The Norwest Energy NL (NWE AU) Board now recommends the offer. Most of the value uplift is due to the 17.4% increase in MinRes’ share price since 15 December.
MinRes’ revised off-market takeover offer is fair in comparison to Warrego Energy (WGO AU)’s bids and historical ranges. However, this is predicated on the MinRes maintaining its share price run.


Norwest Energy (NWE AU): The Board Perplexing Succumbs to MinRes’ Revised Offer

<ul>
<li>
<a href="https://www.smartkarma.com/entities/warrego-energy-ltd-082ab214-f4bb-4224-b321-8977486cd661" target="_blank" data-smartkarma-citation="entities:7808:1" rel="noopener">Warrego Energy (WGO AU)</a>’s offers from Hancock and <a href="https://www.smartkarma.com/entities/strike-energy-ltd" target="_blank" data-smartkarma-citation="entities:12473:1" rel="noopener">Strike Energy (STX AU)</a> close on 31 January and 13 February, respectively. As time passes, the chance of a further bump is slim.</li>
<li>
<a href="https://www.smartkarma.com/entities/mineral-resources-ltd" target="_blank" data-smartkarma-citation="entities:15103:1" rel="noopener">Mineral Resources (MIN AU)</a> is the kingmaker. A MinRes/Strike pairing results in a combined min of 49.83% to a max of 73.93% of outstanding shares (if Hancock retains its stake).</li>
<li>A MinRes/Hancock pairing results in a combined min of 45.21% to a max of 69.32% of outstanding shares (if Strike retains its stake). This is the likely scenario.</li>
</ul>



Warrego Energy (WGO AU)’s offers from Hancock and Strike Energy (STX AU) close on 31 January and 13 February, respectively. As time passes, the chance of a further bump is slim.

Mineral Resources (MIN AU) is the kingmaker. A MinRes/Strike pairing results in a combined min of 49.83% to a max of 73.93% of outstanding shares (if Hancock retains its stake).
A MinRes/Hancock pairing results in a combined min of 45.21% to a max of 69.32% of outstanding shares (if Strike retains its stake). This is the likely scenario.


<ul>
<li>We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.</li>
<li>Highest spreads - <a href="https://www.smartkarma.com/entities/alliance-aviation-services-ltd" target="_blank" data-smartkarma-citation="entities:20401:1" rel="noopener">Alliance Aviation Services (AQZ AU)</a>, <a href="https://www.smartkarma.com/entities/21-vianet-group-inc-adr" target="_blank" data-smartkarma-citation="entities:8489:1" rel="noopener">21Vianet Group (VNET US)</a>, <a href="https://www.smartkarma.com/entities/united-fiber-system-ltd" target="_blank" data-smartkarma-citation="entities:20826:1" rel="noopener">Golden Energy &amp; Resources (GER SP)</a>, <a href="https://www.smartkarma.com/entities/genesis-minerals-ltd" target="_blank" data-smartkarma-citation="entities:4650:1" rel="noopener">Genesis Minerals (GMD AU)</a>, <a href="https://www.smartkarma.com/entities/origin-energy-ltd" target="_blank" data-smartkarma-citation="entities:797:1" rel="noopener">Origin Energy (ORG AU)</a>, <a href="https://www.smartkarma.com/entities/111-inc" target="_blank" data-smartkarma-citation="entities:27412:1" rel="noopener">111 Inc (YI US)</a>.</li>
<li>Lowest spreads - <a href="https://www.smartkarma.com/entities/essential-metals-ltd" target="_blank" data-smartkarma-citation="entities:9645:1" rel="noopener">Essential Metals (ESS AU)</a>, <a href="https://www.smartkarma.com/entities/nitro-software-ltd" target="_blank" data-smartkarma-citation="entities:30943:1" rel="noopener">Nitro Software Ltd (NTO AU)</a>, <a href="https://www.smartkarma.com/entities/norwest-energy-nl" target="_blank" data-smartkarma-citation="entities:1433:1" rel="noopener">Norwest Energy NL (NWE AU)</a>, <a href="https://www.smartkarma.com/entities/chip-eng-seng-corp-ltd" target="_blank" data-smartkarma-citation="entities:6441:1" rel="noopener">Chip Eng Seng Corp (CHIP SP)</a>, <a href="https://www.smartkarma.com/entities/conexio-corp" target="_blank" data-smartkarma-citation="entities:19064:1" rel="noopener">Conexio Corp (9422 JP)</a>, Nippon Steel Trading.</li>
</ul>


We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads - Alliance Aviation Services (AQZ AU), 21Vianet Group (VNET US), Golden Energy &amp; Resources (GER SP), Genesis Minerals (GMD AU), Origin Energy (ORG AU), 111 Inc (YI US).
Lowest spreads - Essential Metals (ESS AU), Nitro Software Ltd (NTO AU), Norwest Energy NL (NWE AU), Chip Eng Seng Corp (CHIP SP), Conexio Corp (9422 JP), Nippon Steel Trading.


Merger Arb Mondays (23 Jan) - Origin Energy, Warrego, Golden Energy, Yashili, Kingston, O2Micro

Australia

Mineral Resources Ltd. offers contract crushing services to the mining industry in Australia.  The Company serves gold, iron ore, tantalum, and coal companies.

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Mineral Resources (MIN AU)

Where To Go With Warrego?

It is fair to say Hancock has significant firepower in reserve - provided they know how MinRes will respond. The Trade: At A$0.40/share, I'd still...

David Blennerhassett

Norwest Backs MinRes' Bumped Offer

This is done. I thought NWE could have held out for even better terms. The revised terms translate to a 5.2% bump. Continue to take down borrow on...

David Blennerhassett

Norwest Energy (NWE AU): The Board Perplexing Succumbs to MinRes’ Revised Offer

The Board has bafflingly recommended an offer that looks good mainly due to the MinRes share price run. Offer unconditional. At the last close, the...

Arun George

Warrego (WGO AU): End-Game Scenarios

Unlikely to see another bump as stretched valuations and deal fatigue sets in. Trading through Hancock's terms, the slim 1.3% spread to Strike’s...

Arun George

Merger Arb Mondays (23 Jan) - Origin Energy, Warrego, Golden Energy, Yashili, Kingston, O2Micro

This week, the highest gross spreads are Alliance Aviation (36.5%), VNET (27.1%), Golden Energy (26.8%), Genesis (24.4%), Origin Energy (23.5%),...

Arun George

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