Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan</li>
<li>Broad based rally ahead of US mid terms as market downplays risks with the inflation numbers on tap this week</li>
<li>Japan: Earnings showing 25% of firms reporting record profits so far for 1H. In contrast, over 40% showing profits down or  losses on cost inflation. Focus today: Daikin, Sumco, Pan-Pacific,etc</li>
</ul>


Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan
Broad based rally ahead of US mid terms as market downplays risks with the inflation numbers on tap this week
Japan: Earnings showing 25% of firms reporting record profits so far for 1H. In contrast, over 40% showing profits down or  losses on cost inflation. Focus today: Daikin, Sumco, Pan-Pacific,etc


Good Morning Japan - November 8, 2022(Tue)

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

<ul>
<li>The <a href="https://asia.nikkei.com/Spotlight/Toshiba-in-turmoil/Toshiba-buyout-Japanese-fund-submits-15bn-proposal" target="_blank" rel="noopener">Nikkei Asia</a> reports that JIP has submitted a formal proposal to privatise <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a> for about JPY2.2 trillion (US$15 billion) based on “Toshiba's current share price.” </li>
<li>JIP’s offer is below expectations of around a JPY6,000 bid which is likely driven by the inability to secure sufficient debt financing. JIP remains in negotiations with banks. </li>
<li>While there is a risk that JIP will be unable to improve its offer to secure Board approval, the downside is low as Toshiba/peers' current price ratio is attractive. </li>
</ul>


The Nikkei Asia reports that JIP has submitted a formal proposal to privatise Toshiba Corp (6502 JP) for about JPY2.2 trillion (US$15 billion) based on “Toshiba's current share price.” 
JIP’s offer is below expectations of around a JPY6,000 bid which is likely driven by the inability to secure sufficient debt financing. JIP remains in negotiations with banks. 
While there is a risk that JIP will be unable to improve its offer to secure Board approval, the downside is low as Toshiba/peers' current price ratio is attractive. 


Toshiba (6502 JP): JIP Lobs a Lower-Than-Expected Offer

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>There are several bits of news in the past few weeks indicating financing commitments might not meet the 7 Nov deadline. Principal among them the JIC/JIP split many weeks ago. </li>
<li>That suggested the 30 Sep and subsequent deadlines would be delayed. And it appears we now have the reason for it, and that is another cause of financing commitment delay.</li>
<li>This development suggests activists have another quiver in their arrow should privatisation not succeed. Toshiba has cheapened in the meantime.</li>
</ul>


There are several bits of news in the past few weeks indicating financing commitments might not meet the 7 Nov deadline. Principal among them the JIC/JIP split many weeks ago. 
That suggested the 30 Sep and subsequent deadlines would be delayed. And it appears we now have the reason for it, and that is another cause of financing commitment delay.
This development suggests activists have another quiver in their arrow should privatisation not succeed. Toshiba has cheapened in the meantime.


Toshiba (6502) - Funding Deadline Risk Was Known 6+ Weeks Ago

<ul>
<li>Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan</li>
<li>US rally overnight on mixed employment and hopes of easing of China Covid-19 restrictions. China officials pour cold water these hopes - look for reversal  </li>
<li>Daikin Nikkei Preview - looks weak; Defense stocks likely gets support; SMBC takes that axe to SMBC Nikko CEO  - harsh. </li>
</ul>


Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan
US rally overnight on mixed employment and hopes of easing of China Covid-19 restrictions. China officials pour cold water these hopes - look for reversal  
Daikin Nikkei Preview - looks weak; Defense stocks likely gets support; SMBC takes that axe to SMBC Nikko CEO  - harsh. 


David Blennerhassett

<ul>
<li>There is potentially a premium of about 20-25% being assessed for the possibility of a deal for <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>, but there is also fundamental risk beyond this.</li>
<li>
<a href="https://www.smartkarma.com/entities/perpetual-ltd" target="_blank" data-smartkarma-citation="entities:599:1" rel="noopener">Perpetual Ltd (PPT AU)</a> rejects EQT/BPEA/Regal's Offer, a proposal that is contingent on PPT ceasing its Scheme with <a href="https://www.smartkarma.com/entities/pendal-group-ltd" target="_blank" data-smartkarma-citation="entities:15795:1" rel="noopener">Pendal Group (PDL AU)</a> </li>
<li>
<a href="https://www.smartkarma.com/entities/news-corp" target="_blank" data-smartkarma-citation="entities:26926:1" rel="noopener">News Corp (NWS AU)</a> is trading rich. The net EV/EBITDA for the stub ops trades closely matches to <a href="https://www.smartkarma.com/entities/fox-corporation" target="_blank" data-smartkarma-citation="entities:36135:1" rel="noopener">Fox (FOXA US)</a>. And Fox is preferable over NWS' print media business. </li>
</ul>


There is potentially a premium of about 20-25% being assessed for the possibility of a deal for Toshiba Corp (6502 JP), but there is also fundamental risk beyond this.

Perpetual Ltd (PPT AU) rejects EQT/BPEA/Regal's Offer, a proposal that is contingent on PPT ceasing its Scheme with Pendal Group (PDL AU) 

News Corp (NWS AU) is trading rich. The net EV/EBITDA for the stub ops trades closely matches to Fox (FOXA US). And Fox is preferable over NWS' print media business. 


Last Week in Event SPACE: Toshiba, Perpetual/Pendal, News Corp/Fox Corp

Japan

Toshiba Corporation manufactures and markets electrical and electronic products. The Company's products include digital products such as PCs and televisions, NAND flash memories, and system LSIs (large-scale integrated), as well as social infrastructures such as power generators, medical equipment, and home appliances.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Toshiba Corp (6502 JP)

Good Morning Japan - November 8, 2022(Tue)

Good Morning Japan: A detailed look at the overnight news and market moves that will impact the trading day in Japan. We highlight small to big...

Mark Chadwick

Toshiba (6502 JP): JIP Lobs a Lower-Than-Expected Offer

While there is a risk that JIP will be unable to improve its offer to secure Board approval, the downside is low as Toshiba/peers' current price...

Arun George

Toshiba (6502) - Funding Deadline Risk Was Known 6+ Weeks Ago

Toshiba/Peers ratio now back to its 6mo average. Toshiba has recently zigged while others zagged. If you believe deal likelihood high, then cheap...

Travis Lundy

Good Morning Japan (November 7, 2022)

The way to start your Japan trading day. "Good Morning Japan" is a detailed look at the overnight news and market moves that will impact the...

Mark Chadwick

Last Week in Event SPACE: Toshiba, Perpetual/Pendal, News Corp/Fox Corp

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)