Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Today saw the publication of three different articles regarding the <a href="https://www.smartkarma.com/entities/alimentation-couche-tard-inc" target="_blank" data-smartkarma-citation="entities:25103:1" rel="noopener">Alimentation Couche-Tard (ATD CN)</a> approach and offer to purchase all the shares of <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I Holdings (3382 JP)</a> </li>
<li>The first in the Nikkei said ATD could push offer a high price, even up to ¥8 trillion. The second mentioned debt financing being feasible because of prodigious cash flow.</li>
<li>The third in Bloomberg noted that 7&amp;i had requested the government upgrade its FEFTA status to "core", which would lead to a more burdensome/restrictive government approval process.</li>
</ul>


Today saw the publication of three different articles regarding the Alimentation Couche-Tard (ATD CN) approach and offer to purchase all the shares of Seven &amp; I Holdings (3382 JP) 
The first in the Nikkei said ATD could push offer a high price, even up to ¥8 trillion. The second mentioned debt financing being feasible because of prodigious cash flow.
The third in Bloomberg noted that 7&amp;i had requested the government upgrade its FEFTA status to "core", which would lead to a more burdensome/restrictive government approval process.


Updates on The Couche-Tard Deal for 7&I (3382 JP)

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>A group of shareholders aims to raise around US$330m via selling around 3.6% of <a href="https://www.smartkarma.com/entities/yamaha-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:7411:1" rel="noopener">Yamaha Motor (7272 JP).</a>
</li>
<li>This will be another cross-shareholding unwind and hence, won’t be a huge surprise, although the stock hasn’t been doing particularly well lately.</li>
<li>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>


A group of shareholders aims to raise around US$330m via selling around 3.6% of Yamaha Motor (7272 JP).

This will be another cross-shareholding unwind and hence, won’t be a huge surprise, although the stock hasn’t been doing particularly well lately.
In this note, we will talk about the deal dynamics and run the deal through our ECM framework.


Yamaha Motors Placement - A Relatively Small Cross-Shareholding Unwind

<ul>
<li>The ¥500bn Offering of Honda shares is now priced (¥1,664.5/share) making it ¥497.46bn. Bookbuilding for retail - 80% of the book - is now. The price today closed at ¥1,665/share. </li>
<li>The Offering has follow-on "non-discretionary" demand which is non-negligible. It is worth understanding the amounts and timing.</li>
<li>The lockups and non-discretionary demand, along with Honda's relative cheapness as a large cap OEM and likely upcoming offerings on competitors means it has support.</li>
</ul>


The ¥500bn Offering of Honda shares is now priced (¥1,664.5/share) making it ¥497.46bn. Bookbuilding for retail - 80% of the book - is now. The price today closed at ¥1,665/share. 
The Offering has follow-on "non-discretionary" demand which is non-negligible. It is worth understanding the amounts and timing.
The lockups and non-discretionary demand, along with Honda's relative cheapness as a large cap OEM and likely upcoming offerings on competitors means it has support.


Big Honda (7267) Offering - Flow Timing Matters

<ul>
<li>At the beginning of this month, we got a scoop from Reuters about a US$3bn selldown of <a href="https://www.smartkarma.com/entities/honda-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:154:1" rel="noopener">Honda Motor (7267 JP)</a> by P&amp;C insurers and others. </li>
<li>We knew this was coming at some point. The FSA had pushed the insurers to unwind cross-holdings, and it is otherwise of the zeitgeist. </li>
<li>It came out as heavily retail-oriented, and the supply/demand details are otherwise interesting. To boot, there is an EPS boost to come.</li>
</ul>


At the beginning of this month, we got a scoop from Reuters about a US$3bn selldown of Honda Motor (7267 JP) by P&amp;C insurers and others. 
We knew this was coming at some point. The FSA had pushed the insurers to unwind cross-holdings, and it is otherwise of the zeitgeist. 
It came out as heavily retail-oriented, and the supply/demand details are otherwise interesting. To boot, there is an EPS boost to come.


The Honda (7267) Offering - Much Easier Than It Looks

<ul>
<li>Just pre-close on 2 July, Reuters carried an article suggesting a ¥500bn secondary offering in <a href="https://www.smartkarma.com/entities/honda-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:154:1" rel="noopener">Honda Motor (7267 JP)</a> as insurers sold. The stock fell 4% in minutes. </li>
<li>Honda semi-confirmed but it took two days to get to the details, now out. The stock climbed in the meantime. </li>
<li>At launch, this deal is two-thirds covered by buyback + passive demand but the supply is heavily-weighted to retail. Cheaper than it looks, lots of moving parts. Read the details!</li>
</ul>


Just pre-close on 2 July, Reuters carried an article suggesting a ¥500bn secondary offering in Honda Motor (7267 JP) as insurers sold. The stock fell 4% in minutes. 
Honda semi-confirmed but it took two days to get to the details, now out. The stock climbed in the meantime. 
At launch, this deal is two-thirds covered by buyback + passive demand but the supply is heavily-weighted to retail. Cheaper than it looks, lots of moving parts. Read the details!


Big ¥500bn Honda (7267) Offering Is Small

Japan

Mazda Motor Corporation manufactures and sells automobiles, trucks, auto parts, and its accessories.  The Company operates its business worldwide.

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Mazda Motor (7261 JP)

Updates on The Couche-Tard Deal for 7&I (3382 JP)

The ATD deal for 3382 will be long-dated. It will take months, not weeks. Effectively, both parties want 3382's share price higher. If higher,...

Travis Lundy

Yamaha Motors Placement - A Relatively Small Cross-Shareholding Unwind

A group of shareholders aims to raise around US$330m via selling around 3.6% of Yamaha Motor (7272 JP). In this note, we talk about the deal dynamics.

Sumeet Singh

Big Honda (7267) Offering - Flow Timing Matters

The Honda Offering is BIG at ¥500bn but over time, the net overhang is substantially reduced by behavioural expectations, passive buying, a...

Travis Lundy

The Honda (7267) Offering - Much Easier Than It Looks

Honda's mega-offering is not mega. It is two-thirds covered by non-active investor demand over the next two months. 80+% if the stock falls post...

Travis Lundy

Big ¥500bn Honda (7267) Offering Is Small

The big ¥500bn Honda offering is announced. Details and context the buyback and passive demand cover two-thirds of the offering but this is going...

Travis Lundy

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