Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>After the market close on 12 December, the Financial Supervisory Service (FSS) put a break on Hyundai Motor Securities’ rights offering worth 200 billion won.</li>
<li>The proposed rights offering included issuing 30.1 million new shares, representing 95% of its current outstanding shares (31.7 million).</li>
<li>We would try to capitalize on the short term bullish upside on its shares of Hyundai Motor Securities and sell into strength.  </li>
</ul>


After the market close on 12 December, the Financial Supervisory Service (FSS) put a break on Hyundai Motor Securities’ rights offering worth 200 billion won.
The proposed rights offering included issuing 30.1 million new shares, representing 95% of its current outstanding shares (31.7 million).
We would try to capitalize on the short term bullish upside on its shares of Hyundai Motor Securities and sell into strength.  


FSS Puts a Break on Hyundai Motor Securities Rights Offering

<ul>
<li>In the next several days, it is likely that the Doosan Group is likely to cancel its restructuring plan involving Doosan Enerbility, Doosan Bobcat, and Doosan Robotics.</li>
<li>As a result of the sharp decline in share prices of major Doosan Group companies, the cost of appraisal rights may be too much for the Doosan Group.</li>
<li>Despite the negative impact of recent political events in Korea, a cancellation of  Doosan Group restructuring plan could have a near-term positive impact on all the major Doosan Group companies.</li>
</ul>


In the next several days, it is likely that the Doosan Group is likely to cancel its restructuring plan involving Doosan Enerbility, Doosan Bobcat, and Doosan Robotics.
As a result of the sharp decline in share prices of major Doosan Group companies, the cost of appraisal rights may be too much for the Doosan Group.
Despite the negative impact of recent political events in Korea, a cancellation of  Doosan Group restructuring plan could have a near-term positive impact on all the major Doosan Group companies.


Doosan Group Is Likely To Cancel Its Restructuring Plans

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.

Mitsubishi Logisnext Co., Ltd. / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mitsubishi-logisnext-co-ltd" target="_blank" rel="noopener">Mitsubishi Logisnext Co., Ltd. (7105 JP)</a> shares rose 26% after the Nikkei reported that <a href="https://www.smartkarma.com/entities/mitsubishi-heavy-industries" target="_blank" data-smartkarma-citation="entities:13613:1" rel="noopener">Mitsubishi Heavy Industries (7011 JP)</a> is contemplating selling its 64.5% stake. </li>
<li>Logisnext confirmed the sale process. In a fair process, minorities should receive the tender offer price plus the proportionate share of Mitsubishi Heavy Industries’ TOB tax benefits. </li>
<li>Despite the rise in share price, Logisnext trades at a discount to peer multiples. At an offer of JPY2,000, Logisnext would trade in line with median peer multiples.</li>
</ul>



Mitsubishi Logisnext Co., Ltd. (7105 JP) shares rose 26% after the Nikkei reported that Mitsubishi Heavy Industries (7011 JP) is contemplating selling its 64.5% stake. 
Logisnext confirmed the sale process. In a fair process, minorities should receive the tender offer price plus the proportionate share of Mitsubishi Heavy Industries’ TOB tax benefits. 
Despite the rise in share price, Logisnext trades at a discount to peer multiples. At an offer of JPY2,000, Logisnext would trade in line with median peer multiples.


Mitsubishi Logisnext (7105 JP): Mitsubishi Heavy Industries (7011 JP) Seeks to Exit

<ul>
<li>Our overall assessment of the new reorganization plan by the Doosan Group continues to be Negative, because Doosan has not given up trying to eventually merge Bobcat and Robotics.</li>
<li>Doosan Group's new reorganization plan is the opposite of KISS strategy, involving several moving parts and complicated deal structure.</li>
<li>We have also provided three main recommendations on how to raise the valuation of Doosan Bobcat without rushing to merge Bobcat and Robotics.</li>
</ul>


Our overall assessment of the new reorganization plan by the Doosan Group continues to be Negative, because Doosan has not given up trying to eventually merge Bobcat and Robotics.
Doosan Group's new reorganization plan is the opposite of KISS strategy, involving several moving parts and complicated deal structure.
We have also provided three main recommendations on how to raise the valuation of Doosan Bobcat without rushing to merge Bobcat and Robotics.


New Reorganization Plan Increases Overhang Risk for Doosan Bobcat

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

<ul>
<li>The big question is how to cash in on the dissenters' rights spread for Robotics. The main concern is cancellation risk, but the FSS doesn’t seem too negative on approval.</li>
<li>To sustain nuclear momentum, Enerbility needs heavy borrowing for facility investments, requiring a lower debt ratio. Offloading debt-heavy Bobcat is a move shareholders might support.</li>
<li>With NPS unlikely to ignore the government's nuclear push, Robotics' spread could narrow quickly. Despite cancellation risk and no hedge, the remaining juice makes an outright position worth considering.</li>
</ul>


The big question is how to cash in on the dissenters' rights spread for Robotics. The main concern is cancellation risk, but the FSS doesn’t seem too negative on approval.
To sustain nuclear momentum, Enerbility needs heavy borrowing for facility investments, requiring a lower debt ratio. Offloading debt-heavy Bobcat is a move shareholders might support.
With NPS unlikely to ignore the government's nuclear push, Robotics' spread could narrow quickly. Despite cancellation risk and no hedge, the remaining juice makes an outright position worth considering.


Doosan’s Tweaked Restructuring Play: My Take on Hitting Robotics' 13% Spread

South Korea

Bobcat Company specializes in design, manufacture, marketing and distribution of compact equipment for construction, rental, landscaping, agriculture, grounds maintenance, government, utility, industry and mining.

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Doosan Bobcat Inc (241560 KS)

FSS Puts a Break on Hyundai Motor Securities Rights Offering

After the market close on 12 December, the Financial Supervisory Service (FSS) put a break on Hyundai Motor Securities’ rights offering worth 200...

Douglas Kim

Doosan Group Is Likely To Cancel Its Restructuring Plans

In the next several days, it is likely that the Doosan Group is likely to cancel its restructuring plan involving Doosan Enerbility, Doosan Bobcat,...

Douglas Kim

Mitsubishi Logisnext (7105 JP): Mitsubishi Heavy Industries (7011 JP) Seeks to Exit

Despite the rise in share price, Logisnext trades at a discount to peer multiples. At an offer of JPY2,000, Logisnext would trade in line with...

Arun George

New Reorganization Plan Increases Overhang Risk for Doosan Bobcat

Doosan Group's new reorganization plan is the opposite of KISS strategy, involving several moving parts and complicated deal structure.

Douglas Kim

Doosan’s Tweaked Restructuring Play: My Take on Hitting Robotics' 13% Spread

This post breaks down Doosan’s revamped restructuring plan with Enerbility and Robotics, and shares my take on how to play Robotics' 13% spread on...

Sanghyun Park

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