Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>I tally 34 - mostly firm, mostly Asia-Pac - arb transactions currently being discussed and analysed on Smartkarma. Those arbs metrics and upcoming events are detailed below.</li>
<li>Three new deals were discussed on Smartkarma this week: <a href="https://www.smartkarma.com/entities/peet-ltd" target="_blank" data-smartkarma-citation="entities:15586:1" rel="noopener">Peet Ltd (PPC AU)</a>, <a href="https://www.smartkarma.com/entities/carnaby-resources-ltd" target="_blank" data-smartkarma-citation="entities:4197:1" rel="noopener">Carnaby Resources (CNB AU)</a>, and <a href="https://www.smartkarma.com/entities/oue-healthcare-limited" target="_blank" data-smartkarma-citation="entities:562:1" rel="noopener">OUE Healthcare (OUEHC SP)</a>.</li>
<li>Key updates/news also took place on: <a href="https://www.smartkarma.com/entities/reliance-worldwide-corp-ltd" target="_blank" data-smartkarma-citation="entities:22690:1" rel="noopener">Reliance Worldwide Corp (RWC AU)</a>, <a href="https://www.smartkarma.com/entities/ausgold-ltd" target="_blank" data-smartkarma-citation="entities:19133:1" rel="noopener">Ausgold Ltd (AUC AU)</a>, <a href="https://www.smartkarma.com/entities/dentsu-soken-inc" target="_blank" data-smartkarma-citation="entities:20535:1" rel="noopener">Dentsu Soken (4812 JP)</a>, and <a href="https://www.smartkarma.com/entities/golfzon-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:16376:1" rel="noopener">Golfzon Holdings (121440 KS)</a>.</li>
</ul>


I tally 34 - mostly firm, mostly Asia-Pac - arb transactions currently being discussed and analysed on Smartkarma. Those arbs metrics and upcoming events are detailed below.
Three new deals were discussed on Smartkarma this week: Peet Ltd (PPC AU), Carnaby Resources (CNB AU), and OUE Healthcare (OUEHC SP).
Key updates/news also took place on: Reliance Worldwide Corp (RWC AU), Ausgold Ltd (AUC AU), Dentsu Soken (4812 JP), and Golfzon Holdings (121440 KS).


Asia-Pac Weekly Wrap: Dentsu Soken, Peet, Carnaby Resources, Reliance Worldwide, Ausgold, Golfzon

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/dentsu-soken-inc" target="_blank" data-smartkarma-citation="entities:20535:1" rel="noopener">Dentsu Soken (4812 JP)</a> announced a preconditional tender offer from <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> at JPY2,880, a 35.0% premium to the undisturbed price but below Nikkei’s rumoured JPY250 billion valuation.</li>
<li>The precondition concerns approvals from Japan, China, and the EU. The offer is expected to commence in early November.</li>
<li>While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a formidable task to force a bump. </li>
</ul>



Dentsu Soken (4812 JP) announced a preconditional tender offer from Itochu Corp (8001 JP) at JPY2,880, a 35.0% premium to the undisturbed price but below Nikkei’s rumoured JPY250 billion valuation.
The precondition concerns approvals from Japan, China, and the EU. The offer is expected to commence in early November.
While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a formidable task to force a bump. 


Dentsu Soken (4812 JP): Itochu (8001 JP)’s Offer Deflates Expectations

Travis Lundy

<ul>
<li>In early July, there was a Nikkei article suggesting <a href="https://www.smartkarma.com/entities/dentsu-inc" target="_blank" data-smartkarma-citation="entities:12434:1" rel="noopener">Dentsu Inc (4324 JP)</a> had settled on possible partners to buy out the minority stakes in <a href="https://www.smartkarma.com/entities/dentsu-soken-inc" target="_blank" data-smartkarma-citation="entities:20535:1" rel="noopener">Dentsu Soken (4812 JP)</a>. </li>
<li>This would give it more scale, and a better future, and would rid Dentsu of a "dual listing" problem. There was a delay. Now 8 weeks later we have news.</li>
<li>
<a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> has apparently decided it will buy it. The structure suits everyone. Oasis has since reported a 5% stake, but I think this gets done.</li>
</ul>


In early July, there was a Nikkei article suggesting Dentsu Inc (4324 JP) had settled on possible partners to buy out the minority stakes in Dentsu Soken (4812 JP). 
This would give it more scale, and a better future, and would rid Dentsu of a "dual listing" problem. There was a delay. Now 8 weeks later we have news.

Itochu Corp (8001 JP) has apparently decided it will buy it. The structure suits everyone. Oasis has since reported a 5% stake, but I think this gets done.


[Japan M&A] Nikkei Reports Itochu to Buy Out Dentsu Soken (4812) Minorities, Co Suggests ¥2,880

<ul>
<li>Nikkei <a href="https://asia.nikkei.com/business/business-deals/japan-s-itochu-to-take-1.5bn-stake-in-dentsu-group-system-developer-unit" target="_blank" rel="noopener">reported</a> that <a href="https://www.smartkarma.com/entities/dentsu-inc" target="_blank" data-smartkarma-citation="entities:12434:1" rel="noopener">Dentsu Inc (4324 JP)</a> and <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> will privatise <a href="https://www.smartkarma.com/entities/dentsu-soken-inc" target="_blank" data-smartkarma-citation="entities:20535:1" rel="noopener">Dentsu Soken (4812 JP)</a> at a total cost of around JPY250 billion.</li>
<li>The rumoured JPY250 billion valuation for the 38.12% stake not owned by Dentsu suggests an offer of JPY3,360 per share, a 22.7% premium to the last close.</li>
<li>Oasis’s emergence as a substantial shareholder ensured a generous offer. The rumoured offer represents an all-time high and is attractive compared to precedent transactions and peer multiples.</li>
</ul>


Nikkei reported that Dentsu Inc (4324 JP) and Itochu Corp (8001 JP) will privatise Dentsu Soken (4812 JP) at a total cost of around JPY250 billion.
The rumoured JPY250 billion valuation for the 38.12% stake not owned by Dentsu suggests an offer of JPY3,360 per share, a 22.7% premium to the last close.
Oasis’s emergence as a substantial shareholder ensured a generous offer. The rumoured offer represents an all-time high and is attractive compared to precedent transactions and peer multiples.


Dentsu Soken (4812 JP): Oasis’s Presence Results in Itochu's Rumoured Generous Offer

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  US Equities rebound led by Tech as NVIDIA +7% gets boost from MS report; China troubles persist: Country Garden suspends bond trading; Foreign Investors losing interest in China</li>
<li>JAPAN. NKY Futures +0.7% vs Cash; USDJPY 145.5;  Yen Weakens be beyond 145 to USD, heads to 146 on widening spreads; JP M&amp;A Boom as Cos seek improvements; Dentsu Miss</li>
<li>NUGGET. Activism-Japanese Firms Expect It ! June's Reuters survey of companies in Japan revealed this fact. At the very minimum, an implicit acknowledgement that there is room for improvement</li>
</ul>


OVERSEAS.  US Equities rebound led by Tech as NVIDIA +7% gets boost from MS report; China troubles persist: Country Garden suspends bond trading; Foreign Investors losing interest in China
JAPAN. NKY Futures +0.7% vs Cash; USDJPY 145.5;  Yen Weakens be beyond 145 to USD, heads to 146 on widening spreads; JP M&amp;A Boom as Cos seek improvements; Dentsu Miss
NUGGET. Activism-Japanese Firms Expect It ! June's Reuters survey of companies in Japan revealed this fact. At the very minimum, an implicit acknowledgement that there is room for improvement


Ohayo Japan| Tech Lead in Equity Rebound Amid Concerns; NUGGET: Activism-Japanese Firms Expect It !

Japan

DENTSU INC. mainly provides comprehensive advertising services.  The Company also provides marketing and event planning & promotion services.  Dentsu has associated companies in the US, Europe, and Asia.

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Dentsu Inc (4324 JP)

Asia-Pac Weekly Wrap: Dentsu Soken, Peet, Carnaby Resources, Reliance Worldwide, Ausgold, Golfzon

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

Dentsu Soken (4812 JP): Itochu (8001 JP)’s Offer Deflates Expectations

While the offer represents a pre-announcement all-time high, it is below the midpoint of the target IFA valuation range. However, activists face a...

Arun George

[Japan M&A] Nikkei Reports Itochu to Buy Out Dentsu Soken (4812) Minorities, Co Suggests ¥2,880

It appears Itochu is the partner to Dentsu in ownership of Dentsu Soken. It probably leads to Itochu rolling it into CTC. Two activists are in but...

Travis Lundy

Dentsu Soken (4812 JP): Oasis’s Presence Results in Itochu's Rumoured Generous Offer

Oasis’s emergence as a substantial shareholder ensured a generous offer. The rumoured offer represents an all-time high and is attractive compared...

Arun George

Ohayo Japan| Tech Lead in Equity Rebound Amid Concerns; NUGGET: Activism-Japanese Firms Expect It !

US Big Cap Tech leads amid concerns; NKY Futures +0.7% vs Cash; USDJPY 145.5; Yen Weakens be beyond 145 to USD, heads to 146 on widening spreads;...

Mark Chadwick

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