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Articles from Caixin Global

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Cross Asset Strategy

<ul><li>Trust / In Depth: China intensifies efforts to curb risk in troubled trust sector</li><li>Personnel /China’s ousted foreign minister removed from top legislature</li><li>Ant Group /Ant Group outbids Citadel Securities for Credit Suisse’s China JV</li></ul>

Trust / In Depth: China intensifies efforts to curb risk in troubled trust sectorPersonnel /China’s ousted foreign minister removed from top legislatureAnt Group /Ant Group outbids Citadel Securities for Credit Suisse’s China JV

CX Daily: China Intensifies Efforts to Curb Risk in Troubled Trust Sector 

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Over the Wire Holdings Ltd / Event-Driven

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<p>There have been numerous take-private transactions for listed-Aussie IT service companies in recent years, some of which have been discussed on Smartkarma. These include...</p>
<ul>
<li>the November 2015 <a href="https://www.asx.com.au/asxpdf/20151125/pdf/4338cczfxtqgs3.pdf" target="_blank" rel="noopener">Scheme</a> for <a href="https://www.smartkarma.com/entities/uxc-ltd" target="_blank" data-smartkarma-citation="entities:965:1" rel="noopener">UXC Ltd (UXC AU)</a>;</li>
<li>the September 2016 <a href="https://www.asx.com.au/asxpdf/20161102/pdf/43clwcp6rxzv35.pdf" target="_blank" rel="noopener">Scheme</a> for <a href="https://www.smartkarma.com/entities/asg-group-ltd" target="_blank" data-smartkarma-citation="entities:7590:1" rel="noopener">ASG Group Ltd (ASZ AU)</a>;</li>
<li>the October 2019 <a href="https://www.asx.com.au/asxpdf/20191218/pdf/44cpl5rwnq34zq.pdf" target="_blank" rel="noopener">Scheme</a> for <a href="https://www.smartkarma.com/entities/csg-ltd" target="_blank" data-smartkarma-citation="entities:12317:1" rel="noopener">CSG Ltd (CSV AU)</a>;</li>
<li>the <a href="https://www.asx.com.au/asxpdf/20201030/pdf/44pcdfqrs4wzm0.pdf" target="_blank" rel="noopener">September 2020</a> Scheme for <a href="https://www.smartkarma.com/entities/dws-ltd" target="_blank" data-smartkarma-citation="entities:10622:1" rel="noopener">DWS Ltd (DWS AU)</a>, discussed by <a href="https://www.smartkarma.com/profiles/janaghan-jeyakumar-cfa" target="_blank" data-smartkarma-citation="accounts:3173" rel="noopener">Janaghan Jeyakumar</a> in <a href="https://skr.ma/kJomK" target="_blank" rel="noopener"> <em>HCL-DWS(DWS AU): Cash Deal Trading Wide</em></a>;</li>
<li>the September 2020 <a href="https://www.asx.com.au/asxpdf/20201030/pdf/44pc22zh1mh1f4.pdf" target="_blank" rel="noopener">Scheme</a> for <a href="https://www.smartkarma.com/entities/citadel-group-ltd-the" target="_blank" data-smartkarma-citation="entities:14087:1" rel="noopener">Citadel Group (CGL AU)</a>, discussed in <em><a href="https://skr.ma/i6V5x" target="_blank" rel="noopener">Citadel Group: Private Equity Partners' Offer</a></em>;</li>
<li>Capgemini's November 2020 <a href="https://assets-global.website-files.com/5eb3a33204ebab1ecd0b72c9/60176e3f9a311b7f4cb909f6_Scheme%20Booklet%20-%20RXP%20Group%20ASX.pdf" target="_blank" rel="noopener">Scheme</a> for <a href="https://www.smartkarma.com/entities/rxp-services-ltd" target="_blank" data-smartkarma-citation="entities:15047:1" rel="noopener">RXP Services (RXP AU)</a>, and its follow up Scheme in July this year for <a href="https://www.smartkarma.com/entities/empired-ltd" target="_blank" data-smartkarma-citation="entities:9406:1" rel="noopener">Empired Ltd (EPD AU)</a> (<em><a href="https://skr.ma/YWsn3" target="_blank" rel="noopener">Empired (EPD AU): Capgemini's Full Offer</a></em>)); and</li>
<li>Norway's Crayon Group Holdings' July 2021 <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02418756-3A575319?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Scheme</a> for <a href="https://www.smartkarma.com/entities/rhipe-ltd" target="_blank" data-smartkarma-citation="entities:19128:1" rel="noopener">rhipe Ltd (RHP AU)</a> - see <em><a href="https://skr.ma/9ysNF" target="_blank" rel="noopener">Rhipe (RHP AU): Done Deal As Scheme Booklet Dispatched</a></em>.    </li>
</ul>
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<p>When <a href="https://www.smartkarma.com/entities/bulletproof-group-ltd" target="_blank" data-smartkarma-citation="entities:3324:1" rel="noopener">Bulletproof (BPF AU)</a>, an IT play, was taken private in 2018, the independent expert cited <a href="https://www.asx.com.au/asxpdf/20180410/pdf/43t32h54tfrk38.pdf" target="_blank" rel="noopener">10 peers</a> (page 28). Five of those peers have been taken private.</p>
<p>Now we have a proposal for the sixth. </p>
</div>
<p><a href="https://www.smartkarma.com/entities/aussie-broadband-pty-ltd" target="_blank" data-smartkarma-citation="entities:30812:1" rel="noopener">Aussie Broadband Pty Ltd (ABB AU)</a> has <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02439848-2A1332945?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">offered</a> to acquire Brisbane-based telecommunications and IT solutions provider <a href="https://www.smartkarma.com/entities/over-the-wire-holdings-ltd" target="_blank" data-smartkarma-citation="entities:30653:1" rel="noopener">Over the Wire Holdings Ltd (OTW AU)</a> by way of a Scheme at $5.75/share.</p>
<p>This is an unsolicited and non-binding proposal. Via a process deed filed on 16 October, OTW said it has granted Aussie Broadband to undertake due diligence and negotiate transaction documentation. That process period ends on the 30 November.</p>
<p>More below the fold.</p>
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There have been numerous take-private transactions for listed-Aussie IT service companies in recent years, some of which have been discussed on Smartkarma. These include...

the November 2015 Scheme for UXC Ltd (UXC AU);
the September 2016 Scheme for ASG Group Ltd (ASZ AU);
the October 2019 Scheme for CSG Ltd (CSV AU);
the September 2020 Scheme for DWS Ltd (DWS AU), discussed by Janaghan Jeyakumar in  HCL-DWS(DWS AU): Cash Deal Trading Wide;
the September 2020 Scheme for Citadel Group (CGL AU), discussed in Citadel Group: Private Equity Partners' Offer;
Capgemini's November 2020 Scheme for RXP Services (RXP AU), and its follow up Scheme in July this year for Empired Ltd (EPD AU) (Empired (EPD AU): Capgemini's Full Offer)); and
Norway's Crayon Group Holdings' July 2021 Scheme for rhipe Ltd (RHP AU) - see Rhipe (RHP AU): Done Deal As Scheme Booklet Dispatched.    


When Bulletproof (BPF AU), an IT play, was taken private in 2018, the independent expert cited 10 peers (page 28). Five of those peers have been taken private.
Now we have a proposal for the sixth. 

Aussie Broadband Pty Ltd (ABB AU) has offered to acquire Brisbane-based telecommunications and IT solutions provider Over the Wire Holdings Ltd (OTW AU) by way of a Scheme at $5.75/share.
This is an unsolicited and non-binding proposal. Via a process deed filed on 16 October, OTW said it has granted Aussie Broadband to undertake due diligence and negotiate transaction documentation. That process period ends on the 30 November.
More below the fold.










Over The Wire (OTW AU): The Latest Aussie IT Play

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<p>Back on the 19 July, systems integrator <a href="https://www.smartkarma.com/entities/empired-ltd" target="_blank" data-smartkarma-citation="entities:9406:1" rel="noopener">Empired Ltd (EPD AU)</a> entered into a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02396546-6A1041326?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Scheme</a> with <a href="https://www.smartkarma.com/entities/capgemini-se" target="_blank" data-smartkarma-citation="entities:28633:1" rel="noopener">Capgemini SE (CGEMY US)</a> at a price of A$1.35/share, a 64.6% premium to last close, and an all-time high. The Offer had the unanimous backing of Empired's board. CEO Russell Baskerville, with 5.8% of Empired's outstanding shares, intended to vote in favour of the Scheme.</p>
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<p>The Scheme Booklet is now <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02425467-6A1051843?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">out</a>. The Scheme Meeting will take place on the 25 October, with expected implementation on the 16 November. The Independent Expert concluded that the Scheme is fair and reasonable.</p>
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<p>This looks done. </p>
</div>
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<p>More below the fold.</p>
</div>


Back on the 19 July, systems integrator Empired Ltd (EPD AU) entered into a Scheme with Capgemini SE (CGEMY US) at a price of A$1.35/share, a 64.6% premium to last close, and an all-time high. The Offer had the unanimous backing of Empired's board. CEO Russell Baskerville, with 5.8% of Empired's outstanding shares, intended to vote in favour of the Scheme.


The Scheme Booklet is now out. The Scheme Meeting will take place on the 25 October, with expected implementation on the 16 November. The Independent Expert concluded that the Scheme is fair and reasonable.


This looks done. 


More below the fold.


Empired (EPD AU): Scheme Booklet Out. Meeting On The 25 October

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<p>Systems integrator <a href="https://www.smartkarma.com/entities/empired-ltd" target="_blank" data-smartkarma-citation="entities:9406:1" rel="noopener">Empired Ltd (EPD AU)</a> has entered into a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02396546-6A1041326?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Scheme</a> with <a href="https://www.smartkarma.com/entities/capgemini-se" target="_blank" data-smartkarma-citation="entities:28633:1" rel="noopener">Capgemini SE (CGEMY US)</a> at a price of A$1.35/share, a 64.6% premium to last close, and an all-time high.</p>
<p>The Offer has the unanimous backing of Empired's board. In addition, CEO Russell Baskerville with 5.8% of Empired's outstanding shares intends to vote in favour of the Scheme.</p>
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<p>In addition to shareholder approval, the Offer is subject to OIO approval. The Offer is <em>not</em> subject to due dili or financing.</p>
<p>This looks done. </p>
</div>
<div>
<p>More below the fold.</p>
</div>


Systems integrator Empired Ltd (EPD AU) has entered into a Scheme with Capgemini SE (CGEMY US) at a price of A$1.35/share, a 64.6% premium to last close, and an all-time high.
The Offer has the unanimous backing of Empired's board. In addition, CEO Russell Baskerville with 5.8% of Empired's outstanding shares intends to vote in favour of the Scheme.


In addition to shareholder approval, the Offer is subject to OIO approval. The Offer is not subject to due dili or financing.
This looks done. 


More below the fold.


<p>Canberra-based IT services outfit <a href="https://www.smartkarma.com/entities/citadel-group-ltd-the" target="_blank" data-smartkarma-citation="entities:14087:1" rel="noopener">Citadel Group (CGL AU)</a> ("CGL") has <a href="https://www.asx.com.au/asxpdf/20200914/pdf/44mlw685ylw63q.pdf" target="_blank" rel="noopener">entered</a> into a Scheme with Private Equity Partners (PEP).</p>
<p>The unsolicited cash consideration of A$5.70/share is a 43.2% premium to the last close of A$3.98/share. A scrip alternative will be made available. The proposal values CGL's equity at A$448.6mn  (US$327mn). </p>
<p>It is the intention of CGL's board to declare a fully franked special dividend of up to A$0.15/share on or shortly before the Scheme implementation date, which theoretically could enable some shareholders to receive up to A0.064/share additional benefit. The cash consideration will be reduced by the special dividend.</p>
<p>The fully franked final dividend of <a href="https://www.asx.com.au/asxpdf/20200827/pdf/44lzffp3ndkqqh.pdf" target="_blank" rel="noopener">A$.06/share</a>, to be paid on the 1 October - for those shareholders who were on the register as at 3 September - is also added.</p>
<p>Apart from standard Scheme shareholder approvals, the Offer has limited conditionality - it is not subject to due diligence nor any funding condition. </p>
<p>Currently trading at a gross/annualised spread of 2.4%/9.4%, assuming mid-late December completion.</p>
<p>As always, more below the fold.</p>

Canberra-based IT services outfit Citadel Group (CGL AU) ("CGL") has entered into a Scheme with Private Equity Partners (PEP).
The unsolicited cash consideration of A$5.70/share is a 43.2% premium to the last close of A$3.98/share. A scrip alternative will be made available. The proposal values CGL's equity at A$448.6mn  (US$327mn). 
It is the intention of CGL's board to declare a fully franked special dividend of up to A$0.15/share on or shortly before the Scheme implementation date, which theoretically could enable some shareholders to receive up to A0.064/share additional benefit. The cash consideration will be reduced by the special dividend.
The fully franked final dividend of A$.06/share, to be paid on the 1 October - for those shareholders who were on the register as at 3 September - is also added.
Apart from standard Scheme shareholder approvals, the Offer has limited conditionality - it is not subject to due diligence nor any funding condition. 
Currently trading at a gross/annualised spread of 2.4%/9.4%, assuming mid-late December completion.
As always, more below the fold.

Citadel Group: Private Equity Partners' Offer

Australia

The Citadel Group Limited develops and delivers systems, services, and managed solutions to the government and private sector. The Company focuses on people and advisory, knowledge management, integration and technology, and education and training. The Citadel Group helps organizations maximize value through leadership and risk management, acquisition and sustainment, and other services.

Citadel Group (CGL AU)

CX Daily: China Intensifies Efforts to Curb Risk in Troubled Trust Sector

Trust / In Depth: China intensifies efforts to curb risk in troubled trust sector Profitability is out and risk management is in. That’s the...

Caixin Global

Over The Wire (OTW AU): The Latest Aussie IT Play

Given DD has been afforded, $5.75/share is probably approaching full value Currently trading at a gross spread of 4.5%. That looks a tad tight,...

David Blennerhassett

Empired (EPD AU): Scheme Booklet Out. Meeting On The 25 October

Trading relatively tight at a 1.5%/11.3% gross/annualised spread. That's reasonable, but this is not a super liquid arb situation.

David Blennerhassett

Empired (EPD AU): Capgemini's Full Offer

This is a done deal and trading at a 3.4%/11% gross/annualised spread. Not bad, but this is not a terribly liquid arb situation.

David Blennerhassett

Citadel Group: Private Equity Partners' Offer

IT services outfit Citadel Group (CGL AU) has entere itno

David Blennerhassett