Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Today, <a href="https://www.smartkarma.com/entities/dai-ichi-life-insurance" target="_blank" data-smartkarma-citation="entities:1109:1" rel="noopener">Dai Ichi Life Insurance (8750 JP)</a>  announced a proposed counter/over-bid for <a href="https://www.smartkarma.com/entities/benefit-one-inc" target="_blank" data-smartkarma-citation="entities:14502:1" rel="noopener">Benefit One Inc (2412 JP)</a>. ¥1800/share for minorities and a better (undefined) outcome for <a href="https://www.smartkarma.com/entities/pasona-group-inc" target="_blank" data-smartkarma-citation="entities:15778:1" rel="noopener">Pasona Group (2168 JP)</a>. </li>
<li>This throws the cat amongst the pigeons as it is unsolicited, for 100% not just to get Pasona's stake, and it will require Benefit One recommend or not.</li>
<li>For Pasona, this deal structure would likely increase the net result from the stake sale, possibly substantially so. It's in the details. </li>
</ul>


Today, Dai Ichi Life Insurance (8750 JP)  announced a proposed counter/over-bid for Benefit One Inc (2412 JP). ¥1800/share for minorities and a better (undefined) outcome for Pasona Group (2168 JP). 
This throws the cat amongst the pigeons as it is unsolicited, for 100% not just to get Pasona's stake, and it will require Benefit One recommend or not.
For Pasona, this deal structure would likely increase the net result from the stake sale, possibly substantially so. It's in the details. 


New Deal for Benefit One (2168) Could Mean Lots More Money for Pasona (2168)

<ul>
<li>As discussed <a href="https://www.smartkarma.com/insights/big-m3-2413-partial-tob-as-pasona-sells-control-of-benefit-one-2412-really-interesting-dynamics" target="_blank" rel="noopener">here</a> in a piece about the Partial Tender Offer<a href="https://www.smartkarma.com/insights/big-m3-2413-partial-tob-as-pasona-sells-control-of-benefit-one-2412-really-interesting-dynamics" target="_blank" data-smartkarma-citation="insights:117493" rel="noopener"></a>, Pasona Group (2168) has agreed to sell its controlling stake in Benefit One (2412) to M3 (2413).</li>
<li>That will leave Pasona Group with a fair chunk of cash and possibly a residual stake in Benefit One, depending on the results.</li>
<li>Though we don't know what the future holds, Pasona now is the wrong price for its future. </li>
</ul>


As discussed here in a piece about the Partial Tender Offer, Pasona Group (2168) has agreed to sell its controlling stake in Benefit One (2412) to M3 (2413).
That will leave Pasona Group with a fair chunk of cash and possibly a residual stake in Benefit One, depending on the results.
Though we don't know what the future holds, Pasona now is the wrong price for its future. 


Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyzed the changes in margin trading positions of JPX stocks as of Mar 27th. The aggregated net margin trading position is USD17,856m.</li>
<li>We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.</li>
<li>We highlight net margin buy/sell changes in Fujikura, SoftBank, Sanrio, West Japan Railway Company, Advantest, Kioxia, Honda Motor, Kyushu Railway Company, Sumitomo Metal Mining, SBI.</li>
</ul>


We analyzed the changes in margin trading positions of JPX stocks as of Mar 27th. The aggregated net margin trading position is USD17,856m.
We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.
We highlight net margin buy/sell changes in Fujikura, SoftBank, Sanrio, West Japan Railway Company, Advantest, Kioxia, Honda Motor, Kyushu Railway Company, Sumitomo Metal Mining, SBI.


JPX Margin Trading Weekly (Mar 27th): Fujikura, SoftBank, Sanrio, West Japan Railway Company

David Blennerhassett

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dai-ichi-life-insurance" target="_blank" data-smartkarma-citation="entities:1109:1" rel="noopener">Dai Ichi (8750 JP)</a> agreed with <a href="https://www.smartkarma.com/entities/pasona-group-inc" target="_blank" data-smartkarma-citation="entities:15778:1" rel="noopener">Pasona (2168 JP)</a> for Pasona to sell its shares back to <a href="https://www.smartkarma.com/entities/benefit-one-inc" target="_blank" data-smartkarma-citation="entities:14502:1" rel="noopener">Benefit One (2412 JP)</a> in a buyback after Dai-Ichi's Tender Offer for Benefit.</li>
<li>This process gives Pasona a tax advantage versus selling into a Tender Offer at the same price.</li>
<li>What does Pasona take home? ~¥2,822/share versus its last price of ¥2,733/share. Then you have stubs ops (conservatively worth up to ~¥1,960/share) and Pasona's stake in <a href="https://www.smartkarma.com/entities/bewith-inc" target="_blank" data-smartkarma-citation="entities:35846:1" rel="noopener">Bewith (9216 JP)</a> (~¥360/share).</li>
</ul>



Dai Ichi (8750 JP) agreed with Pasona (2168 JP) for Pasona to sell its shares back to Benefit One (2412 JP) in a buyback after Dai-Ichi's Tender Offer for Benefit.
This process gives Pasona a tax advantage versus selling into a Tender Offer at the same price.
What does Pasona take home? ~¥2,822/share versus its last price of ¥2,733/share. Then you have stubs ops (conservatively worth up to ~¥1,960/share) and Pasona's stake in Bewith (9216 JP) (~¥360/share).


Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

<ul>
<li>Some low liquidity stocks in the TOPIX Index carry a liquidity factor of 0.75x resulting in their actual index weights being smaller than their default weights.</li>
<li>These names are reviewed every April and if the liquidity factor of a stock gets removed, the stock will enjoy buying flows from passive trackers of TOPIX.</li>
<li>In this insight, we take a look at Quiddity's final predictions for the names that are likely to see their Liquidity Factors removed in April 2023.</li>
</ul>


Some low liquidity stocks in the TOPIX Index carry a liquidity factor of 0.75x resulting in their actual index weights being smaller than their default weights.
These names are reviewed every April and if the liquidity factor of a stock gets removed, the stock will enjoy buying flows from passive trackers of TOPIX.
In this insight, we take a look at Quiddity's final predictions for the names that are likely to see their Liquidity Factors removed in April 2023.


TOPIX Index Upweights: Final Predictions for The "The Big April Basket” 2023

Japan

Bewith,Inc. provides contact center and and business process outsourcing (BPO) services. The Company also offers various artificial intelligence, digital transformation solutions, application and platform, and related consulting services. Bewith conducts businesses in Japan.

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Bewith (9216 JP)

New Deal for Benefit One (2168) Could Mean Lots More Money for Pasona (2168)

Dai-Ichi Life proposed a full takeout of Benefit One which would lead to a different structured sale by Pasona. The structure of that sale would...

Travis Lundy

Pasona: The Wrong Price

Pasona is now trading ~65% of post-tender net after-tax cash+securities. Maybe cheaper. Pasona ex-Benefit One/ex-Bewith is guided to lose money...

Travis Lundy

JPX Margin Trading Weekly (Mar 27th): Fujikura, SoftBank, Sanrio, West Japan Railway Company

We analyzed JPX margin trading positions report for the past week and highlighted Fujikura (5803 JP), SoftBank (9984 JP), Sanrio (8136 JP), West...

Ke Yan, CFA, FRM

Get Your Pasona (2168 JP) Rump For Free

Pasona (2168 JP) said that 10-20% of the total extraordinary gain from the sale of Benefit One Inc (2412 JP) Is to be paid out as a special...

David Blennerhassett

TOPIX Index Upweights: Final Predictions for The "The Big April Basket” 2023

This insight (from Feb 2023) discusses the annual TOPIX Liquidity Factor (LF) removal event (which we call the "Big April Basket"). It might be a...

Janaghan Jeyakumar, CFA

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