Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<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

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.

<ul>
<li>
<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> shareholders have voted against Sir Poon’s HK$7.20 per share offer. The vote marginally failed the &lt;10% of all disinterested shareholders' rejection threshold.</li>
<li>While painful, this deal break was arguably the correct outcome as the offer was below the net cash and Dickson is cash generative on an underlying basis. </li>
<li>Unlike the last HK deal break (Soundwill), the price action over the last two days indicated a done deal. My estimated break price is HK$5.00 (30% downside to last close).</li>
</ul>



Dickson Concepts Intl (113 HK) shareholders have voted against Sir Poon’s HK$7.20 per share offer. The vote marginally failed the &lt;10% of all disinterested shareholders' rejection threshold.
While painful, this deal break was arguably the correct outcome as the offer was below the net cash and Dickson is cash generative on an underlying basis. 
Unlike the last HK deal break (Soundwill), the price action over the last two days indicated a done deal. My estimated break price is HK$5.00 (30% downside to last close).


Dickson Concepts (113 HK): A Necessary HK Arbageddon

<ul>
<li>After <a href="https://www.smartkarma.com/entities/goldlion-holdings-ltd" target="_blank" data-smartkarma-citation="entities:12359:1" rel="noopener">Goldlion (533 HK)</a>'s spectacular Scheme fail, <a href="https://www.smartkarma.com/entities/soundwill-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19318:1" rel="noopener">Soundwill  (878 HK)</a> appeared destined to be the next failure as shares dipped hard ahead of the Scheme vote. And fail it did.</li>
<li>Just like for Goldlion, Soundwill's Offer was clearly light. The counter-argument was that terms were, arguably, as good as it gets. And no competing Offer would emerge. Minorities voiced otherwise.</li>
<li>Hong Kong has been the proverbial graveyard for arb deals of late. However, in a positive sense, minorities in Goldlion and Soundwill simply rejected opportunistic Offers. </li>
</ul>


After Goldlion (533 HK)'s spectacular Scheme fail, Soundwill  (878 HK) appeared destined to be the next failure as shares dipped hard ahead of the Scheme vote. And fail it did.
Just like for Goldlion, Soundwill's Offer was clearly light. The counter-argument was that terms were, arguably, as good as it gets. And no competing Offer would emerge. Minorities voiced otherwise.
Hong Kong has been the proverbial graveyard for arb deals of late. However, in a positive sense, minorities in Goldlion and Soundwill simply rejected opportunistic Offers. 


Soundwill (878 HK): Thoughts On The Latest Scheme Fail

<ul>
<li>
<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> shareholders have voted against the Foo family’s HK$8.50 per share offer. The minority participation rate was high, and the NO vote comfortably failed the value test.</li>
<li>Unlike the <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> deal break, the price action over the last three days pointed to a deal break. Like previous deal breaks, this one offers hard lessons.</li>
<li>Soundwill has the fourth-highest premium of the pre-deal break price to the undisturbed price compared to previous deal breaks. My estimated deal-break price is HK$5.63, 13.2% below the last close.</li>
</ul>



Soundwill Holdings (878 HK) shareholders have voted against the Foo family’s HK$8.50 per share offer. The minority participation rate was high, and the NO vote comfortably failed the value test.
Unlike the Goldlion Holdings (533 HK) deal break, the price action over the last three days pointed to a deal break. Like previous deal breaks, this one offers hard lessons.
Soundwill has the fourth-highest premium of the pre-deal break price to the undisturbed price compared to previous deal breaks. My estimated deal-break price is HK$5.63, 13.2% below the last close.


Soundwill Holdings (878 HK): Hard Lessons from Another HK Arbageddon

Canvest Environmental Protection Group / Event-Driven

<ul>
<li>Ahead of the 12th May shareholder to vote on Grandblue's Offer, recent price action in <a href="https://www.smartkarma.com/entities/canvest-environmental-protection-group-co-ltd" target="_blank" data-smartkarma-citation="entities:100:1" rel="noopener">Canvest (1381 HK)</a> has been odd, with considerable selling volume.</li>
<li>By all accounts, a chunk of that selling was brought about by an event desk in Singapore shutting down. Elsewhere, via numerous inquiries, I see nothing deal specific. </li>
<li>In recent positive developments, AEP (3.62% of shares out) is supportive; there are no material updates in s329 announcements; and I see nothing of note when inspecting the shareholder register. </li>
</ul>


Ahead of the 12th May shareholder to vote on Grandblue's Offer, recent price action in Canvest (1381 HK) has been odd, with considerable selling volume.
By all accounts, a chunk of that selling was brought about by an event desk in Singapore shutting down. Elsewhere, via numerous inquiries, I see nothing deal specific. 
In recent positive developments, AEP (3.62% of shares out) is supportive; there are no material updates in s329 announcements; and I see nothing of note when inspecting the shareholder register. 


Canvest (1381 HK): Buy Here, And On Weakness

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)

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

China Traditional Chinese Medicine (570 HK)

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

Dickson Concepts (113 HK): A Necessary HK Arbageddon

While painful, this deal break was arguably the correct outcome as the offer was below the net cash. My estimated break price is HK$5.00 (30%...

Arun George

Soundwill (878 HK): Thoughts On The Latest Scheme Fail

The outcome for Soundwill was not a big surprise. However, expect current and future illiquid small-cap arbs to trade wide(r) if there is a whiff...

David Blennerhassett

Soundwill Holdings (878 HK): Hard Lessons from Another HK Arbageddon

Like previous deal breaks, this one offers hard lessons and suggests that HK merger arb is increasingly fraught with risk. My estimated deal-break...

Arun George

Canvest (1381 HK): Buy Here, And On Weakness

The Scheme comfortable got up - despite a last minute hiccup to adjourn the meeting. Seems one shareholder sought to postpone the meeting, which...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)