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>
<a href="https://www.smartkarma.com/entities/newmark-property-reit" target="_blank" data-smartkarma-citation="entities:40696:1" rel="noopener">Newmark Property REIT (NPR AU)</a> has disclosed an off-market takeover merger proposal from <a href="https://www.smartkarma.com/entities/bwp-trust" target="_blank" data-smartkarma-citation="entities:11056:1" rel="noopener">Bwp Trust (BWP AU)</a> of 0.40 BWP units per NPR unit, implying A$1.39 per NPR unit. </li>
<li>The proposal is conditional on a 50.1% minimum acceptance condition, which can be waived or lowered. Irrevocables represent 18.35% of NPR units.</li>
<li>The offer is attractive given the weak sector sentiment due to ongoing high-interest rates. At the last close, the gross spread was 2.6%.</li>
</ul>



Newmark Property REIT (NPR AU) has disclosed an off-market takeover merger proposal from Bwp Trust (BWP AU) of 0.40 BWP units per NPR unit, implying A$1.39 per NPR unit. 
The proposal is conditional on a 50.1% minimum acceptance condition, which can be waived or lowered. Irrevocables represent 18.35% of NPR units.
The offer is attractive given the weak sector sentiment due to ongoing high-interest rates. At the last close, the gross spread was 2.6%.


Newmark Property REIT (NPR AU): Merger with BWP Trust (BWP AU)

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>The changes at the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225</a> September rebalance were announced on 4 September. The rebalance of the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI</a>, <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI</a>, <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH</a> and HSCI was implemented on the same day.</li>
<li>The changes to the MVIS indices were announced on 8 September and will be implemented at the close on 15 September. The S&amp;P/ASX family will also rebalance on 15 September.</li>
<li>After a month and a half of big inflows to onshore China ETFs, there were small outflows from a lot of ETFs during the week.</li>
</ul>


The changes at the Nikkei 225 September rebalance were announced on 4 September. The rebalance of the HSI, HSCEI, HSTECH and HSCI was implemented on the same day.
The changes to the MVIS indices were announced on 8 September and will be implemented at the close on 15 September. The S&amp;P/ASX family will also rebalance on 15 September.
After a month and a half of big inflows to onshore China ETFs, there were small outflows from a lot of ETFs during the week.


Index Rebalance & ETF Flow Recap: NKY, ASX, CSI300, KOSDAQ150, Yuanta ETFs, MVA, MVW, SMH

<ul>
<li>As expected, <a href="https://www.smartkarma.com/entities/abacus-group" target="_blank" data-smartkarma-citation="entities:10566:1" rel="noopener">Abacus Group (ABG AU)</a> will be deleted from the MVIS Australia A-REIT Index at the close on 15 September.</li>
<li>
<a href="https://www.smartkarma.com/entities/abacus-group" target="_blank" data-smartkarma-citation="entities:10566:1" rel="noopener">Abacus Group (ABG AU)</a> will also be deleted from the <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> on the same day, so this increases the sell flow on the stock.</li>
<li>Estimated one-way turnover at the rebalance is 3.8% resulting in a one-way trade of A$23.8m. There are a few stocks with over 1x ADV to trade from passive trackers.</li>
</ul>


As expected, Abacus Group (ABG AU) will be deleted from the MVIS Australia A-REIT Index at the close on 15 September.

Abacus Group (ABG AU) will also be deleted from the S&amp;P/ASX 200 (AS51 INDEX) on the same day, so this increases the sell flow on the stock.
Estimated one-way turnover at the rebalance is 3.8% resulting in a one-way trade of A$23.8m. There are a few stocks with over 1x ADV to trade from passive trackers.


MVIS Australia A-REITs Index Rebalance: Abacus Group Deletion Means More Outflow

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

National Storage REIT / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/national-storage-reit" target="_blank" data-smartkarma-citation="entities:13762:1" rel="noopener">National Storage REIT (NSR AU)</a> (NSREIT) aims to raise around US$200m (A$300m) via an institutional placement.</li>
<li>Past deals have ended up doing well, however, the stock now appears toppish and it's unclear if the deal was well flagged.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>



National Storage REIT (NSR AU) (NSREIT) aims to raise around US$200m (A$300m) via an institutional placement.
Past deals have ended up doing well, however, the stock now appears toppish and it's unclear if the deal was well flagged.
In this note, we will talk about the placement and run the deal through our ECM framework.


National Storage REIT Placement - Past Deals Have Done Well but Stock Looks Toppish

<p><a href="https://www.smartkarma.com/entities/aventus-group" target="_blank" data-smartkarma-citation="entities:25897:1" rel="noopener">Aventus Group (AVN AU)</a> is Australia’s largest fully integrated owner, manager and developer of large format retail centres in Australia. Aventus entered a scheme implementation deed to implement a merger with <a href="https://www.smartkarma.com/entities/homeco-daily-needs-reit" target="_blank" data-smartkarma-citation="entities:33526:1" rel="noopener">HomeCo Daily Needs REIT (HDN AU)</a> and <a href="https://www.smartkarma.com/entities/home-consortium-ltd" target="_blank" data-smartkarma-citation="entities:29082:1" rel="noopener">Home Consortium Ltd (HMC AU)</a>. Aventus securityholders will be offered 2.200 HDN units for every 1 unit in Aventus Retail Property Fund (93% of transaction value) and A$0.285 cash or 0.038 HMC securities for every 1 share in Aventus Holdings Limited (7% of transaction value). </p><p>The implied offer price of A$3.82 per Aventus share is a 15.3% premium to the unaffected price of A$3.31 (15 October). The offer price will not be reduced for any distributions announced by Aventus, HDN and HMC prior to the implementation. Post-merger, Aventus securityholders will own 47.1% of the merged group.</p><p>The scheme is conditional on AVN securityholder approval by at least 75% of the votes cast and 50% securityholders voting. Brett Blundy Retail Capital (BBRC) and the Aventus Board which represents 22.6% and 6.7% of AVN securities, respectively, intend to vote in favour of the merger. The scheme is also conditional on HDN unitholder approval by at least 50% of votes cast (HMC cannot vote). </p><div class="content-highlight"><p>We think that recommended offer is attractive both in terms of historical multiples and share prices for Aventus securityholders. The merger is also FFO and NTA accretive to Aventus securityholders. While the merger is FFO accretive, it is NTA dilutive to HDN unitholders. Nevertheless, the strong strategic rationale for the merger should gain support from HDN unitholders. At the last close prices of Aventus and HDN, Aventus’ shares are trading at 3.6% gross spread to the indicative offer.</p></div>

Aventus Group (AVN AU) is Australia’s largest fully integrated owner, manager and developer of large format retail centres in Australia. Aventus entered a scheme implementation deed to implement a merger with HomeCo Daily Needs REIT (HDN AU) and Home Consortium Ltd (HMC AU). Aventus securityholders will be offered 2.200 HDN units for every 1 unit in Aventus Retail Property Fund (93% of transaction value) and A$0.285 cash or 0.038 HMC securities for every 1 share in Aventus Holdings Limited (7% of transaction value). The implied offer price of A$3.82 per Aventus share is a 15.3% premium to the unaffected price of A$3.31 (15 October). The offer price will not be reduced for any distributions announced by Aventus, HDN and HMC prior to the implementation. Post-merger, Aventus securityholders will own 47.1% of the merged group.The scheme is conditional on AVN securityholder approval by at least 75% of the votes cast and 50% securityholders voting. Brett Blundy Retail Capital (BBRC) and the Aventus Board which represents 22.6% and 6.7% of AVN securities, respectively, intend to vote in favour of the merger. The scheme is also conditional on HDN unitholder approval by at least 50% of votes cast (HMC cannot vote). We think that recommended offer is attractive both in terms of historical multiples and share prices for Aventus securityholders. The merger is also FFO and NTA accretive to Aventus securityholders. While the merger is FFO accretive, it is NTA dilutive to HDN unitholders. Nevertheless, the strong strategic rationale for the merger should gain support from HDN unitholders. At the last close prices of Aventus and HDN, Aventus’ shares are trading at 3.6% gross spread to the indicative offer.

Aventus Recommended Merger with HomeCo Daily Needs REIT

Australia

BWP Trust operates as a real estate investment trust. The Trust invests and manages commercial properties. BWP Trust serves customers in Australia.

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Bwp Trust (BWP AU)

Newmark Property REIT (NPR AU): Merger with BWP Trust (BWP AU)

The offer is attractive given the weak sector sentiment due to ongoing high-interest rates. It opens in mid-February, with the earliest close in...

Arun George

Index Rebalance & ETF Flow Recap: NKY, ASX, CSI300, KOSDAQ150, Yuanta ETFs, MVA, MVW, SMH

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

MVIS Australia A-REITs Index Rebalance: Abacus Group Deletion Means More Outflow

Abacus Group will be deleted from the index; there is a surprising float increase on Abacus Storage King. That will add to or offset flows from...

Brian Freitas

National Storage REIT Placement - Past Deals Have Done Well but Stock Looks Toppish

National Storage REIT (NSR AU) (NSREIT) aims to raise around US$200m (A$300m) via an institutional placement. In this note, we run the deal through...

Sumeet Singh

Aventus Recommended Merger with HomeCo Daily Needs REIT

The offer is attractive in terms of P/NTA and share prices for AVN. The merger is also FFO and NTA accretive to AVN. The strong strategic rationale...

Arun George

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