Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<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> is trading tight  - perhaps too tight - to terms, as every punter views the deal as a term deposit.</li>
<li>Be long <a href="https://www.smartkarma.com/entities/welcia-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20895:1" rel="noopener">Welcia Holdings (3141 JP)</a>. Be long <a href="https://www.smartkarma.com/entities/tsuruha-holdings-inc" target="_blank" data-smartkarma-citation="entities:9536:1" rel="noopener">Tsuruha Holdings (3391 JP)</a>. Buy dips. Buy big dips post-tender. Future guidance will include synergy effects.</li>
<li>Richard Li's <a href="https://www.smartkarma.com/entities/hkt-ltd" target="_blank" data-smartkarma-citation="entities:874:1" rel="noopener">HKT Ltd (6823 HK)</a> is in the crosshairs as FCC moves to expel the telco from U.S. networks. </li>
</ul>



Hang Seng Bank (11 HK) is trading tight  - perhaps too tight - to terms, as every punter views the deal as a term deposit.
Be long Welcia Holdings (3141 JP). Be long Tsuruha Holdings (3391 JP). Buy dips. Buy big dips post-tender. Future guidance will include synergy effects.
Richard Li's HKT Ltd (6823 HK) is in the crosshairs as FCC moves to expel the telco from U.S. networks. 


Last Week In Event SPACE: Hang Seng, Welcia/Tsuruha, HKT, Genting, Daiichi, Aussie Rare Earths

<ul>
<li>First it was the Li family's, via <a href="https://www.smartkarma.com/entities/ck-hutchison-holdings-ltd" target="_blank" data-smartkarma-citation="entities:132:1" rel="noopener">CK Hutchison Holdings (1 HK)</a>, investment in two Panama ports, which raised the ire of the U.S. government. And remains unresolved.</li>
<li>Now the U.S.'s Federal Communication Commission (FCC) has taken the initial step to “expel Hong Kong Telecom” - i.e. <a href="https://www.smartkarma.com/entities/hkt-ltd" target="_blank" data-smartkarma-citation="entities:874:1" rel="noopener">HKT Ltd (6823 HK)</a> - from the US telecommunication network.</li>
<li>The FCC order cites HKT's affiliation with black-listed <a href="https://www.smartkarma.com/entities/china-unicom-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:1016:1" rel="noopener">China Unicom (762 HK)</a>. Unicom holds a 18.4% stake in <a href="https://www.smartkarma.com/entities/pccw-ltd" target="_blank" data-smartkarma-citation="entities:873:1" rel="noopener">PCCW (8 HK)</a>, HKT's parent.  A stake it acquired twenty years ago.</li>
</ul>


First it was the Li family's, via CK Hutchison Holdings (1 HK), investment in two Panama ports, which raised the ire of the U.S. government. And remains unresolved.
Now the U.S.'s Federal Communication Commission (FCC) has taken the initial step to “expel Hong Kong Telecom” - i.e. HKT Ltd (6823 HK) - from the US telecommunication network.
The FCC order cites HKT's affiliation with black-listed China Unicom (762 HK). Unicom holds a 18.4% stake in PCCW (8 HK), HKT's parent.  A stake it acquired twenty years ago.


The Li Family's Latest U.S. Setback As The FCC Targets HKT

Washington H. Soul Pattinson and Co. Ltd / Event-Driven

<ul>
<li>There is, or perhaps, was, imbedded value via the cross-holding. However, <a href="https://www.smartkarma.com/entities/washington-h-soul-pattinson-and-co-ltd" target="_blank" data-smartkarma-citation="entities:6054:1" rel="noopener">Soul Patts (SOL AU)</a> &amp; <a href="https://www.smartkarma.com/entities/brickworks-ltd" target="_blank" data-smartkarma-citation="entities:2726:1" rel="noopener">Brickworks (BKW AU)</a>'s combined market cap has increased 18% or A$3.1bn since announcing their merger.</li>
<li>
<a href="https://www.smartkarma.com/entities/furukawa-battery-co-ltd" target="_blank" data-smartkarma-citation="entities:6513:1" rel="noopener">Furukawa Battery (6937 JP)</a> is a VERY low-priced MBO-like transaction. The pricing process is unacceptable. It is a take-under. It is BAD process. But it'll get done.</li>
<li>For a company that has consistently spilled red ink at the stub level, there is no justification why <a href="https://www.smartkarma.com/entities/pccw-ltd" target="_blank" data-smartkarma-citation="entities:873:1" rel="noopener">PCCW Ltd (8 HK)</a> would/should trade at a NAV premium.</li>
</ul>


There is, or perhaps, was, imbedded value via the cross-holding. However, Soul Patts (SOL AU) &amp; Brickworks (BKW AU)'s combined market cap has increased 18% or A$3.1bn since announcing their merger.

Furukawa Battery (6937 JP) is a VERY low-priced MBO-like transaction. The pricing process is unacceptable. It is a take-under. It is BAD process. But it'll get done.
For a company that has consistently spilled red ink at the stub level, there is no justification why PCCW Ltd (8 HK) would/should trade at a NAV premium.


Last Week In Event SPACE: Soul Patts/Brickworks, Furukawa Battery, PCCW, TPG Telecom

<ul>
<li>Three for three. Three low-balled Hong Kong Offers, by way of Schemes, have now lapsed over the past ten weeks. </li>
<li>Both <a href="https://www.smartkarma.com/entities/goldlion-holdings-ltd" target="_blank" data-smartkarma-citation="entities:12359:1" rel="noopener">Goldlion Holdings (533 HK)</a> and <a href="https://www.smartkarma.com/entities/soundwill-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19318:1" rel="noopener">Soundwill Holdings (878 HK)</a> spectacularly failed back in May.</li>
<li>Now <a href="https://www.smartkarma.com/entities/dickson-concepts-intl-ltd" target="_blank" data-smartkarma-citation="entities:5052:1" rel="noopener">Dickson Concepts Intl (113 HK)</a> has followed suit. But the vote was (much) closer than it should have been.</li>
</ul>


Three for three. Three low-balled Hong Kong Offers, by way of Schemes, have now lapsed over the past ten weeks. 
Both Goldlion Holdings (533 HK) and Soundwill Holdings (878 HK) spectacularly failed back in May.
Now Dickson Concepts Intl (113 HK) has followed suit. But the vote was (much) closer than it should have been.


Dickson Concept (113 HK): More Minority Teeth Bared As Another Scheme Fails

<ul>
<li>Six months and counting; yet <a href="https://www.smartkarma.com/entities/china-mobile-ltd" target="_blank" data-smartkarma-citation="entities:27:1" rel="noopener">China Mobile (941 HK)</a> continues to (slowly, but surely) chip away at various pre-conditions. </li>
<li>In its <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2025/0609/2025060900588.pdf" target="_blank" rel="noopener">monthly update</a>, <a href="https://www.smartkarma.com/entities/hkbn-ltd" target="_blank" data-smartkarma-citation="entities:289:1" rel="noopener">HKBN Ltd (1310 HK)</a> said Mobile has proposed commitments to Hong Kong's Communication Authority,  and that the commitments are sufficient to effectively address the CA's concerns. </li>
<li>The CA is seeking industry feedback by the 13th June, but a favourable conclusion appears a lock. Elsewhere, no update on I-Squared's proposal. </li>
</ul>


Six months and counting; yet China Mobile (941 HK) continues to (slowly, but surely) chip away at various pre-conditions. 
In its monthly update, HKBN Ltd (1310 HK) said Mobile has proposed commitments to Hong Kong's Communication Authority,  and that the commitments are sufficient to effectively address the CA's concerns. 
The CA is seeking industry feedback by the 13th June, but a favourable conclusion appears a lock. Elsewhere, no update on I-Squared's proposal. 


HKBN (1310 HK): CA Approval (All But) Done. NDRC & MoC Still Outstanding

Hong Kong

PCCW Limited, through its subsidiaries, provides telecommunications, Internet access, multimedia services and related equipment.  The Company also offers computer, engineering, and other technical services in Hong Kong.  In addition, PCCW invests in and develops system integration and technology-related business, infrastructure and properties in Hong Kong and China.

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PCCW Ltd (8 HK)

Last Week In Event SPACE: Hang Seng, Welcia/Tsuruha, HKT, Genting, Daiichi, Aussie Rare Earths

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

The Li Family's Latest U.S. Setback As The FCC Targets HKT

PCCW should not trade at a massive premium. Unless PCCW or HKT is next in the cross-hairs. However this latest FCC development is unlikely to spur...

David Blennerhassett

Last Week In Event SPACE: Soul Patts/Brickworks, Furukawa Battery, PCCW, TPG Telecom

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

Dickson Concept (113 HK): More Minority Teeth Bared As Another Scheme Fails

This is a consistently profitable company. The undisturbed price was $4.78. Yet the HSI is up ~12.8% since the Offer was announced, so perhaps...

David Blennerhassett

HKBN (1310 HK): CA Approval (All But) Done. NDRC & MoC Still Outstanding

You have Mobile's firm offer at a 2.1% gross spread. My bet is that the key PRC regulators are holding back until CA clears the transaction. Do not...

David Blennerhassett

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