Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Canvest Environmental Protection Group / Event-Driven

<ul>
<li>I tally 40 - mostly firm, mostly Asia-Pac - transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.</li>
<li>Four new deals discussed this week: Schemes for <a href="https://www.smartkarma.com/entities/beijing-capital-grand-ltd" target="_blank" data-smartkarma-citation="entities:18241:1" rel="noopener">Beijing Capital Grand (1329 HK)</a> and <a href="https://www.smartkarma.com/entities/cm-hi-tech-cleanroom-limited" target="_blank" data-smartkarma-citation="entities:44057:1" rel="noopener">CM Hi-Tech (2115 HK)</a>, and Tender Offers for <a href="https://www.smartkarma.com/entities/elematec-corp" target="_blank" data-smartkarma-citation="entities:2866:1" rel="noopener">Elematec (2715 JP)</a> and <a href="https://www.smartkarma.com/entities/nec-networks-system-integr" target="_blank" data-smartkarma-citation="entities:16396:1" rel="noopener">Nec Networks (1973 JP)</a>.</li>
<li>Key updates took place on: <a href="https://www.smartkarma.com/entities/hotel-property-investments" target="_blank" data-smartkarma-citation="entities:9850:1" rel="noopener">Hotel Property Investments (HPI AU)</a>, <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental Protection Group (1381 HK)</a> and <a href="https://www.smartkarma.com/entities/capitol-health-ltd" target="_blank" data-smartkarma-citation="entities:14504:1" rel="noopener">Capitol Health (CAJ AU)</a>.</li>
</ul>


I tally 40 - mostly firm, mostly Asia-Pac - transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
Four new deals discussed this week: Schemes for Beijing Capital Grand (1329 HK) and CM Hi-Tech (2115 HK), and Tender Offers for Elematec (2715 JP) and Nec Networks (1973 JP).
Key updates took place on: Hotel Property Investments (HPI AU), Canvest Environmental Protection Group (1381 HK) and Capitol Health (CAJ AU).


(Mostly) Asia-Pac M&A: Beijing Capital Grand, Elematec, Nec Networks, Hotel Property Invest, Canvest

<ul>
<li>Back on the 22 July, waste-to-energy play <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest Environmental (1381 HK)</a> announced a pre-conditional Offer from <a href="https://www.smartkarma.com/entities/grandblue-environment-co-a" target="_blank" data-smartkarma-citation="entities:17887:1" rel="noopener">Grandblue Environment (600323 CH)</a> at $4.90/share (best &amp; final), by way of a Scheme.</li>
<li>PRC anti-monopoly law and SAMR approvals were secured ~2.5 months from the Offer announcement. MoC, NDRC, SAMR and SAFE approvals remain outstanding. The pre-con long-stop is the 17th July 2025.</li>
<li>The transaction appears on track. However, Canvest's gross spread has widened 6.4% - out to 13.4% as I type - since <a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">China Traditional Chinese Medicine (570 HK)</a> blew up. That's excessive.</li>
</ul>


Back on the 22 July, waste-to-energy play Canvest Environmental (1381 HK) announced a pre-conditional Offer from Grandblue Environment (600323 CH) at $4.90/share (best &amp; final), by way of a Scheme.
PRC anti-monopoly law and SAMR approvals were secured ~2.5 months from the Offer announcement. MoC, NDRC, SAMR and SAFE approvals remain outstanding. The pre-con long-stop is the 17th July 2025.
The transaction appears on track. However, Canvest's gross spread has widened 6.4% - out to 13.4% as I type - since China Traditional Chinese Medicine (570 HK) blew up. That's excessive.


Canvest (1381 HK): This Is Trading Too Wide

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyze the monthly Hong Kong Connect flows with our data engine.</li>
<li>We tabulate the top stocks by inflows, outflows, and holding by mainland investors.</li>
<li>We highlight inflows into Alibaba, Xiaomi, SMIC, Geely, CCB and outflows from Meituan.</li>
</ul>


We analyze the monthly Hong Kong Connect flows with our data engine.
We tabulate the top stocks by inflows, outflows, and holding by mainland investors.
We highlight inflows into Alibaba, Xiaomi, SMIC, Geely, CCB and outflows from Meituan.


Hong Kong Connect Flows (October): $12 Bn Inflows

<ul>
<li>For the month of October 2024, 10 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$9bn.</li>
<li>The average premium for the new transactions announced (or first discussed) in October was ~26%. The average premium YTD is ~42%.</li>
<li>This compares to the average premium for transactions in 2023 (117 transactions), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) of 39%, 41%, 33%, 31%, and 31% respectively.</li>
</ul>


For the month of October 2024, 10 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$9bn.
The average premium for the new transactions announced (or first discussed) in October was ~26%. The average premium YTD is ~42%.
This compares to the average premium for transactions in 2023 (117 transactions), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) of 39%, 41%, 33%, 31%, and 31% respectively.


(Mostly) Asia M&A, Oct 2024: Arcadium, T Gaia, Elematec, NEC Network, MPHB, Sigma Health, Fuji Soft

<ul>
<li>On the 14th October, cleanroom play <a href="https://www.smartkarma.com/entities/cm-hi-tech-cleanroom-limited" target="_blank" data-smartkarma-citation="entities:44057:1" rel="noopener">CM Hi-Tech Cleanroom (2115 HK)</a> announced a <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2024/1014/2024101401232.pdf" target="_blank" rel="noopener">pre-conditional Offer</a> by way of a Scheme from <a href="https://www.smartkarma.com/entities/mayair-technology-china-co-ltd" target="_blank" data-smartkarma-citation="entities:44058:1" rel="noopener">MayAir Technology (688376 CH)</a> and CM Hi-Tech's senior management.</li>
<li>HK$0.25/Share (best &amp; final) is the Cancellation Price, or a 25% premium to undisturbed. Rollover shareholders and concert parties collectively hold 55.27%, leaving 44.73% held by disinterested shareholders .</li>
<li>MayAir shareholders have now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2024/1030/2024103001533.pdf" target="_blank" rel="noopener">approved</a> the Offer. Other pre-cons include NDRC, Mofcom and SAFE.  The pre-conditional long-stop is the 13 December 2025. That's an unrealistic timeline.</li>
</ul>


On the 14th October, cleanroom play CM Hi-Tech Cleanroom (2115 HK) announced a pre-conditional Offer by way of a Scheme from MayAir Technology (688376 CH) and CM Hi-Tech's senior management.
HK$0.25/Share (best &amp; final) is the Cancellation Price, or a 25% premium to undisturbed. Rollover shareholders and concert parties collectively hold 55.27%, leaving 44.73% held by disinterested shareholders .
MayAir shareholders have now approved the Offer. Other pre-cons include NDRC, Mofcom and SAFE.  The pre-conditional long-stop is the 13 December 2025. That's an unrealistic timeline.


Hong Kong

China Traditional Chinese Medicine Co. Limited, through its subsidiaries, manufactures and sells medicine and pharmaceutical products in China.

China Traditional Chinese Medicine (570 HK)

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China Traditional Chinese Medicine (570 HK)

(Mostly) Asia-Pac M&A: Beijing Capital Grand, Elematec, Nec Networks, Hotel Property Invest, Canvest

This insight provides a summary of gross/annualised spreads (on deals discussed on Smartkarma) across Asia-Pacific as at the last trading date, and...

David Blennerhassett

Canvest (1381 HK): This Is Trading Too Wide

After TCM, arbitrageurs don't have the risk appetite to be hit with a double whammy before year-end. However, Canvest's approval process is more...

David Blennerhassett

Hong Kong Connect Flows (October): $12 Bn Inflows

We analyzed the Hong Kong Connect Scheme for October and highlighted flows for Alibaba, Xiaomi, SMIC, Geely, CCB, and Meituan.

Ke Yan, CFA, FRM

(Mostly) Asia M&A, Oct 2024: Arcadium, T Gaia, Elematec, NEC Network, MPHB, Sigma Health, Fuji Soft

For the month of Oct, 10 new deals were discussed on Smartkarma with an overall deal size of just ~US$9bn. The average premium for the new deals...

David Blennerhassett

CM Hi-Tech (2115 HK)'s Strange Offer

Trading at a 10.1%/34.1% gross/annualised spread, if late Feb payment. If small, illiquid arbs are your thing, you might get involved here....

David Blennerhassett

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