Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Thematic (Sector/Industry)

<ul>
<li>To an Australian individual investor, franking credits simply recognise tax already paid by a company on their earnings. These credits may reduce tax you would otherwise pay on dividend income.</li>
<li>This dividend imputation system prevents double taxation and essentially treats company tax paid as a prepayment of shareholder tax.</li>
<li>The system makes a lot of sense. It's a curious thing so few countries have adopted a similar corporate tax structure.</li>
</ul>


To an Australian individual investor, franking credits simply recognise tax already paid by a company on their earnings. These credits may reduce tax you would otherwise pay on dividend income.
This dividend imputation system prevents double taxation and essentially treats company tax paid as a prepayment of shareholder tax.
The system makes a lot of sense. It's a curious thing so few countries have adopted a similar corporate tax structure.


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

Event-Driven

<ul>
<li>The review period for the June rebalance of the S&amp;P/ASX family of indices ends tomorrow and we expect two changes for 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>. </li>
<li>Impact of passive trading on the stocks varies between 4.3-11 days of ADV. Short interest on the potential adds is small while there are significant shorts on the potential deletes.</li>
<li>We expect there is pre-positioning on at least three of the four stocks. In some cases that is small, while it could be a lot larger in other stocks.</li>
</ul>


The review period for the June rebalance of the S&amp;P/ASX family of indices ends tomorrow and we expect two changes for the S&amp;P/ASX 200 (AS51 INDEX). 
Impact of passive trading on the stocks varies between 4.3-11 days of ADV. Short interest on the potential adds is small while there are significant shorts on the potential deletes.
We expect there is pre-positioning on at least three of the four stocks. In some cases that is small, while it could be a lot larger in other stocks.


S&P/​​​​​​​ASX Index Rebalance Preview: Potential Changes, Impact, Shorts & Positioning

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ventia-services-group" target="_blank" data-smartkarma-citation="entities:34917:1" rel="noopener">Ventia (VNT AU)</a> completed an A$300m placement overnight with Apollo and <a href="https://www.smartkarma.com/entities/cimic-group-ltd" target="_blank" data-smartkarma-citation="entities:20030:1" rel="noopener">CIMIC Group Ltd (CIM AU)</a> selling around 14% of the shares outstanding at a small discount to the close.</li>
<li>The placement will significantly increase <a href="https://www.smartkarma.com/entities/ventia-services-group" target="_blank" data-smartkarma-citation="entities:34917:1" rel="noopener">Ventia (VNT AU)</a>'s float and make the stock a high probability inclusion to 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> at the June rebalance.</li>
<li>We now expect two changes to 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> in June and the impact on the stocks is over 5.5 days of ADV to trade.</li>
</ul>



Ventia (VNT AU) completed an A$300m placement overnight with Apollo and CIMIC Group Ltd (CIM AU) selling around 14% of the shares outstanding at a small discount to the close.
The placement will significantly increase Ventia (VNT AU)'s float and make the stock a high probability inclusion to the S&amp;P/ASX 200 (AS51 INDEX) at the June rebalance.
We now expect two changes to the S&amp;P/ASX 200 (AS51 INDEX) in June and the impact on the stocks is over 5.5 days of ADV to trade.


Ventia (VNT AU) - Placement Could Lead to ASX200 Inclusion in June

<ul>
<li>
<strong><a href="https://www.smartkarma.com/entities/maca-ltd" target="_blank" data-smartkarma-citation="entities:11390:1" rel="noopener">MACA Ltd (MLD AU)</a></strong> recently announced a friendly off-market cash offer from fellow contractor Thiess, at A$1.025/share, a 28.1% premium to previous close.</li>
<li>The Offer is subject to limited conditions, including FIRB , ACCC sign-off, no prescribed occurrences, no issue of convertible securities, derivatives, or other rights, and 90% minimum acceptances.</li>
<li>The Offer has unanimous support from MACA's board. Applications to FIRB and the ACCC have already been submitted. The announcement suggests MACA remains open to alternative approaches.</li>
</ul>



MACA Ltd (MLD AU) recently announced a friendly off-market cash offer from fellow contractor Thiess, at A$1.025/share, a 28.1% premium to previous close.
The Offer is subject to limited conditions, including FIRB , ACCC sign-off, no prescribed occurrences, no issue of convertible securities, derivatives, or other rights, and 90% minimum acceptances.
The Offer has unanimous support from MACA's board. Applications to FIRB and the ACCC have already been submitted. The announcement suggests MACA remains open to alternative approaches.


<ul>
<li>For the month of April, 10 new deals (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$22bn.</li>
<li>The average premium for the new deals announced (or first discussed) in April was ~36%.</li>
<li>This compares to the average premium for all deals in 2021 (165 deals), 2020 (158 deals), and 2019 (145 deals) of 33%, 31%, and 31.5% respectively.</li>
</ul>


For the month of April, 10 new deals (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$22bn.
The average premium for the new deals announced (or first discussed) in April was ~36%.
This compares to the average premium for all deals in 2021 (165 deals), 2020 (158 deals), and 2019 (145 deals) of 33%, 31%, and 31.5% respectively.


Australia

CIMIC Group Ltd. operates in the infrastructure, resources, and property markets. The Company constructs roads, tunnels and bridges, water pipelines and desalination plants, commercial and industrial buildings, resorts and residential precincts, as well as land reclamation, and offshore oil and gas structures, and provides contract mining services.

CIMIC Group Ltd (CIM AU)

Let's Talk Aussie Franking Credits

Dividend imputation allows tax credits to be passed to shareholders from companies for corporate tax paid. It prevents double taxation and treats...

David Blennerhassett

S&P/ASX Index Rebalance Preview: Potential Changes, Impact, Shorts & Positioning

There could be 2 changes for the ASX200 in June. Impact is high on most stocks. Shorts are small on the adds & very high on the deletes. There...

Brian Freitas

Ventia (VNT AU) - Placement Could Lead to ASX200 Inclusion in June

Apollo & CIMIC sold 14% of Ventia yesterday. That increases Ventia's float and should result in ASX200 inclusion in June. The placement was...

Brian Freitas

MACA: Thiess's Friendly Cash Offer

You have a firm, unanimously backed Offer. Trading around a 3.3% gross spread to term. I'd get involved here. A competing Offer cannot be ruled out.

David Blennerhassett

(Mostly) Asia M&A: April 2022 Roundup

For the month of April, nine new deals were discussed on Smartkarma with an overall announced deal size of ~US$22bn. The average premium for the...

David Blennerhassett

Let's Talk Aussie Franking Credits

Dividend imputation allows tax credits to be passed to shareholders from companies for corporate tax paid. It prevents double taxation and treats...

David Blennerhassett

S&P/​​​​​​​ASX Index Rebalance Preview: Potential Changes, Impact, Shorts & Positioning

There could be 2 changes for the ASX200 in June. Impact is high on most stocks. Shorts are small on the adds & very high on the deletes. There...

Brian Freitas

Ventia (VNT AU) - Placement Could Lead to ASX200 Inclusion in June

Apollo & CIMIC sold 14% of Ventia yesterday. That increases Ventia's float and should result in ASX200 inclusion in June. The placement was...

Brian Freitas

MACA: Thiess's Friendly Cash Offer

You have a firm, unanimously backed Offer. Trading around a 3.3% gross spread to term. I'd get involved here. A competing Offer cannot be ruled out.

David Blennerhassett

(Mostly) Asia M&A: April 2022 Roundup

For the month of April, nine new deals were discussed on Smartkarma with an overall announced deal size of ~US$22bn. The average premium for the...

David Blennerhassett

S&P/ASX Index Rebalance Preview: Potential Changes, Impact, Shorts & Positioning