Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven


For the month of November, 21 new deals were discussed on Smartkarma with an overall announced deal size of ~US$75bn, helped in large part by LVMH's bid for Tiffany &amp; Co (TIF US).


Clicking on the company name in the table below will take you to the entity page where you can read the initial insight(s) written by Smartkarma contributors on these new deals and follow up discussions, or simply click on the insight link(s) below the name.






New Deals


Industry


Size (US$bn)


Type


Premium



Australia



Panoramic Resources (PAN AU) 
Mining
0.2
Off-market 
42%


Independence's Hostile Offer For Panoramic



Caltex Australia (CTX AU) 
Fuel retail
5.8
Scheme 
24%


Caltex's Proposed Retail IPO Triggers Revised Bid From Couche-Tard


Hong Kong



Springland International (1700 HK) 
Supermarkets
0.2
Scheme
63%


Springland And The Latest Retail Takeover



China Agri Industries Hldgs (606 HK) 
Grain processing
2.9
Scheme
34%


Going With The Grain As COFCO Bids For China Agri


Japan



Toshiba Plant Systems &amp; Services (1983 JP) 
Engineering
1.2
Tender Offer
27%


Toshiba Tender for Toshiba Plant (1983) - Lighter Than It Should Be.



Nuflare Technology (6256 JP) 
Semiconductors
0.6
Tender Offer
45%


Toshiba Tender for Nuflare Technology (6256) - Lightish to Too Light. 



Nishishiba Electric (6591 JP) 
Marine/offshore
0.1
Tender Offer
43%


Toshiba Tender for Nishishiba Electric (6591) - Also Cheap. 



Mitsubishi Tanabe Pharma (4508 JP) 
Pharmaceuticals
4.5
Tender Offer
50%


MitChem Deal for MitTanabePharma - Opportunistic But Likely Not To Cause Too Much Upset. 



Mystar Engineering (4695 JP) 
Engineering
0.1
Tender Offer
17%



SmallCap Mystar Engineering (4695) Tender Offer  - WRONG PRICE 



 LINE Corp (3938 JP) / Z Holdings (4689 JP)

Mobile messaging
3.2
Tender Offer
13%



Z and LINE, Sitting in a Tree... M.E.R.G.I.N... G...?. 
LINE and Z, Sitting in a Tree... M.E.R.G.I.N.G! And a Tender Offer!
The Z Holdings-LINE Merger Is Likely to Put Mobile Payments Businesses in Antitrust Territory. 



Singapore



Citic Envirotech (CEL SP) 
Water treatment
0.2
Exit Offer
62%


CITIC Envirotech's Privatisation Offer.



Isec Healthcare (ISEC SP) 
Heatlcare
0.2
MGO
11%


Circular Dispatched For Isec Healthcare's MGO. 


South Korea



Orange Life Insurance, Ltd. (079440 KS) 
Insurance
0.1
Merger
N/A


Shinhan &amp; Orange Life Merger Swap Summary. 



Haimarrow Food Service Co Ltd (220630 KS) 
F&amp;B
0.2
Buyout
26%


Korea M&amp;A Spotlight: A Buyout of Haimarrow Food Service



Hanwha Galleria Timeworld (027390 KS) 
Department stores
0.1
Tender Offer
17%



Tender Offer To Take Hanwha Galleria Timeworld Private.  
Hanwha Galleria TW Tender Offer: Schedule, Price &amp; Current Status. 



UK &amp; Europe







OSRAM Licht AG (OSR GR) 
Lighting solutions
4.3
Takeover Offer
42%


Second ams Deal for Osram - Concessions And "Elbow Calculus". 



Amerisur Resources (AMER LN) 
O&amp;G
0.3
Cash acquisition
59%


In A Light, Sweet Spot As Geopark Bids For Amerisur. 



Veloxis Pharmaceuticals (VELO DC) 
Pharmaceuticals
1.5
Tender Offer
-26%


Asahi Kasei’s Voluntary Conditional Tender Offer for Veloxis Pharmaceuticals: Unfairly Priced. 


North America




Aircastle Ltd (AYR US) 
Aircraft leasing
2.4
Agreement/merger
34%


Aircastle Takeover - Still Trading at a Premium But Good To Go At Terms. 



Tiffany &amp; Co (TIF US) 
Jewellery
14.5
Offer
37%



Louis Vuitton Offers to Acquire Tiffany: Luxury Valuation to Semi Luxury Brand. 
Tiffany (TIF US): Out of the Blue.




Hewlett Packard Co (HPQ US) 
Printers
33
Offer
13.5%


Xerox to Acquire HP Inc: Two Fading Stars to Unite





Source: Smartkarma Insights

The Offer for Osram is a reload from ams AG (AMS SW) and I've used the unaffected price from the previous offer to back out the premium.  

The Veloxis Pharmaceuticals (VELO DC) discount is somewhat misleading - Veloxis raised its annual guidance on 31st October 2019, and its share price rallied to DKK7.49/share from ~DKK4.00,  the highest price in the last ten years.   

The deal for Isec Healthcare (ISEC SP) was announced in August but only discussed on Smartkarma this month. 


The average premium for the new deals announced in November was 32%, while the average for the first eleven months of 2019 is ~32%.



Brief Summary of News in November of Arb Situations On Smartkarma's Radar



(Again, click on the company names to take to you to the insights and/or discussion posts for a more comprehensive read-through on each situation. Where a new insight was written on these names in June, I've included a link to that insight in italics.)






Australia


Comments (with links &amp; insights)




Australian Unity Office Fund (AOF AU) 

Where to start ... 1-Nov: Hume Partners bumped its stake to 9.55% on the 5 November, and as then to t11.4%  AOF Buckles As Hume Keeps Mum.  14-Nov: ASIC issues interim order.
Wanted: New Legal Team for AOF.  18-Nov. one of the two interdependent resolutions was voted down at a low-turnout vote. 19-Nov: ASIC has opted to withdraw its application.
ASIC's Panel Application Withdrawal Leaves Market Players Guessing. 




Aveo Group (AOG AU) 

31-Oct: FIRB approval received.  
7-Nov: AOG's securityholders have voted in favour of the Scheme. 
The implementation date is the 29 November.




Bellamy's Australia (BAL AU) 

14-Nov: Bellamy's Scheme gets FIRB approval.
27-Nov: Bellamy settles two shareholder class action proceedings for A$49.7mn.




CSG Ltd (CSV AU) 

22-Nov: AGM held. All resolutions carried except addtitional 10% placement.




Echo Resources (EAR AU) 

1-Nov: Northern Star Resources (NST AU)issues compulsory acquisition notice.
8-Nov: Shares suspended at the close of trading




Erm Power Ltd (EPW AU) 

8-Nov: ERM's shareholders overwhelmingly voted in favour of the Scheme. The Scheme is expected to be implemented on the 29 November.




Pacific Energy (PEA AU) 

18-Nov: Shares suspended at the close of trading




Qms Media (QMS AU) 

No Nov update




Webster Ltd (WBA AU) 

No Nov update












China


Comments




Shenzhen Kondarl Group (000048 CH) 
No Nov update.











Hong Kong


Comments (with links &amp; insights)




Avic International Holding-H (161 HK) 

23-Nov: AVIC are still finalising the data to go in the Composite Document. This Document is due out on or before the 15 January 2020.
27-Nov:  Two wholly-owned subsidiaries of CK Hutchison Holdings (1 HK) holding 9.04% of H shares out, intend to vote their shares in favour of relevant resolutions towards delisting AVIC.




Dah Chong Hong (1828 HK) 

8 Nov: Scheme Document delayed until the 3 Dec from the 10 Nov.




Huaneng Renewables Corp H (958 HK) 

21-Nov: Composite doc dispatched. Fair &amp; reasonable says IFA. Huaneng Renew's Composite Doc Despatched. 




Leyou Technologies (1089 HK) 

22-Nov: Leyou updates the market to say they have received a number of non-binding indicative bids. Additionally, Mr. Yuk will update the market in around 3  weeks whether to proceed or terminate with the share disposal. 




Maanshan Iron &amp; Steel H (323 HK) 

11-Nov: MGO closed with 596.39mn shares tendering, representing 11.64% of shares out or 41.727% of H shares.




Yixin Group Ltd (2858 HK) 

7-Nov: Monthly update. nothing substantial to add.









India


Comments




Adani Gas Ltd (ADGAS IN) 
28-Nov: The CCI has approved Total Group's 37.4% stake-buy, joint control of Adani Gas








Japan


Comments (with links &amp; insights)




Asunaro Aoki Construction (1865 JP) 

No Nov update




Cocokara Fine (3098 JP) 

No Nov update




Keihin Corp (7251 JP) 

3-Nov: The English language doc from Honda Motor (7267 JP) for Keihin is out. 




Nissin Kogyo (7230 JP) 

3-Nov: The English language doc from Honda Motor (7267 JP) for Keihin is out. 




Polatechno (4239 JP) 

No Nov update




Sanyo Chemical Ind (4471 JP) /  Nippon Shokubai (4114 JP) 

Sanyo Chem &amp; Nippon Shokubai - Fundamentals Still Favor SanyoChem. 




Showa Corp (7274 JP) 

3-Nov: The English language doc from Honda Motor (7267 JP) for Keihin is out. 




Sotsu Co Ltd (3711 JP) 

26-Nov: Results for the Bandai Namco Holdings (7832 JP) Tender Offer for Sotsu: 82.05%. That is enough to clean out minorities but not enough to do so without an EGM. I expect 17.95% (or say at least 10+%) will vote against setting up an appraisal rights process. Gundam Has Fallen! Long Live Gundam!




Unizo Holdings (3258 JP) 

6-Nov: The Nov 6 Blackstone deadline for Unizo to respond/negotiate has come and gone with no notice by Blackstone of the event or news on UNIZO’s IR website. UNIZO: Belaboring a Deceased Equine. 11-Nov: Fortress have extended the deadline for their deal from 11 Nov to 15 November. 15-Nov: Fortress has increased its Tender Offer Price for Unizo by ¥100 to ¥4100. This is a technical raise because it extends the deadline by 10 business days beyond the current deadline which was today. The new deadline is the 29th of November.  22-Nov: Blackstone has offered a press release well after the close today regarding the status of its intended Tender Offer for Unizo if UNIZO "consents" or possibly if it does not. UNIZO has apparently put forth a proposal and Blackstone has responded. UNIZO: It's Not You, It's Me... Really.
28-Nov: Blackstone says Unizo has not agreed to its $1.6 billion takeover offer (Reuters)











Philippines


Comments




Holcim Philippines (HLCM PM) 

No Nov update.











Singapore


Comments (with links &amp; insights)




Ascendas Hospitality (ASCHT SP) 
21-Oct: The Scheme Meeting, approving the deal. The timeline is now ticking to completion. 



Keppel Corp Ltd (KEP SP) 
No updates. Insight: Gauging Foreign Investment Review Risk for Temasek Takeover of Keppel.  The Dummies' Guide to Partial Offers/Tenders. 




United Engineers (UEM SP) 
12-Nov: Yanlord bumps: Yanlord Bumps Offer For United Engineers.  Read more:  15-Nov: Offer was declared unconditional in all respects on the 15 November  27-Nov: Circular dispatched: Yanlords' Unconditional Offer For United Engineer Gets IFA Backing. 











Thailand


Comments (with links)



Glow Energy Pcl (GLOW TB)
22-Nov: A short clarification notice from Glow Energy Pcl (GLOW TB)'s Tender Offer, which runs from the 25 September to the 28 November - as trading on the SET is T+2, the last day to purchase GLOW shares in order to accept the Offer from Global Power Synergy Company Ltd (GPSC TB) is the 26 November: 


Golden Land Prop Dvlp (GOLD TB)

20-Nov: Delisting proposals approved




SVI Pcl (SVI TB) 

4-Nov The tendering into the Offer was just 26.83%. Then shares popped, and remain elevated. 



Thanachart Capital (TCAP TB)

No Nov update.











UK


Comments (with links &amp; insights)



EI Group (EIG LN)
19-Nov: Reports a full-year loss after tax.



Entertainment One (ETO LN) 
21-Nov: The UK's Competition and Markets Authority has decided this morning that it will take on the case of Hasbro Inc (HAS US)'s bid for Entertainment. Invitation to comment lasts until December 5th. The inquiry Phase 1 should be completed by 21 January 2020.



Just Eat PLC (JE/ LN) 

25-Nov has offered its Response Circular to the Takeaway.com NV (TKWY NA) Offer.  They want a higher premium to where it was trading prior to the TKWY bid.
Just Eat (JE/ LN): From a Strategic Perspective Prosus Is the Best Buyer, It Should Pay More.
Just Eat Plc Situation Looks Headed To Auction. 




Scottish Salmon Co Plc (SSC NO) 
No Nov update



Sophos (SOPH LN) 
No Nov update










Europe


Comments (with links &amp; insights)




Altran Technologies Sa (ALT FP) 

15-Oct: Tender Offer docs issued. 16-Oct: Tender Offer is open.




OSRAM Licht AG (OSR GR) 

1-Oct: ams gets to 19.99%. Min acceptance not achieved. Ams Offer Does Not Win Osram. Back To Square 2 18-Oct: New ams deal for Osram.
New ams Deal for Osram In Store - It's Doable







On 18th July, TDR-owned UK pub company Stonegate and UK's pub company <a href="https://www.smartkarma.com/entities/enterprise-inns-plc" target="_blank" data-smartkarma-citation="entities:21924:1" rel="noopener">EI Group (EIG LN)</a>  <a href="https://secure.eigroupplc.com/recommended-offer/media/2-7-Announcement.pdf" target="_blank" rel="noopener">announced</a> that they had reached an agreement for Stonegate to acquire EIG at a cash consideration of 285 pence per EIG share (Enterprise Value of £2.97bn and an equity value of £1.27bn), or a premium of 38.5% and 37.7% to the pre-announcement closing price and the 6-month VWAP respectively. This was discussed in <a href="https://www.smartkarma.com/profiles/travis-lundy" target="_blank" data-smartkarma-citation="accounts:25" rel="noopener">Travis Lundy</a>'s insight <a href="https://skr.ma/mHnNj" target="_blank" rel="noopener">Purchasing the Publican: EI Group as Target</a>.
<a href="https://www.smartkarma.com/entities/cheung-kong-property-holding" target="_blank" rel="noopener">CK Asset Holdings (1113 HK)</a> has now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2019/0819/ltn20190819811.pdf" target="_blank" rel="noopener">announced</a> it will pay $3.28bn for brewery company <a href="https://www.smartkarma.com/entities/greene-king-plc" target="_blank" data-smartkarma-citation="entities:21953:1" rel="noopener">Greene King PLC (GNK LN)</a> by way of a Scheme, and take on additional debt of $2.31bn. Greene King shareholders will receive 850 pence in cash per share, a 51% premium to last close and a three-year high price.
Similar to the EIG transaction, this deal is conditional on the receipt of approval from GNK's Shareholders (representing at least 75% of the votes cast at the GM), European Commission, and/or CMA anti-trust clearances and regulatory clearances from the FCA. The Acquisition is expected to become effective in the fourth quarter of this year.  On an LTM EV/EBITDA multiple, the Offer Price for both transactions is almost identical.
Trading at terms. The Consideration will not be adjusted for the final dividend - for the year ended 28 April 2019 - of 24.4 pence, however, the register closed to participants on the 9 August (i.e. if you buy now you don't get the div).

On 18th July, TDR-owned UK pub company Stonegate and UK's pub company EI Group (EIG LN)  announced that they had reached an agreement for Stonegate to acquire EIG at a cash consideration of 285 pence per EIG share (Enterprise Value of £2.97bn and an equity value of £1.27bn), or a premium of 38.5% and 37.7% to the pre-announcement closing price and the 6-month VWAP respectively. This was discussed in Travis Lundy's insight Purchasing the Publican: EI Group as Target.
CK Asset Holdings (1113 HK) has now announced it will pay $3.28bn for brewery company Greene King PLC (GNK LN) by way of a Scheme, and take on additional debt of $2.31bn. Greene King shareholders will receive 850 pence in cash per share, a 51% premium to last close and a three-year high price.
Similar to the EIG transaction, this deal is conditional on the receipt of approval from GNK's Shareholders (representing at least 75% of the votes cast at the GM), European Commission, and/or CMA anti-trust clearances and regulatory clearances from the FCA. The Acquisition is expected to become effective in the fourth quarter of this year.  On an LTM EV/EBITDA multiple, the Offer Price for both transactions is almost identical.
Trading at terms. The Consideration will not be adjusted for the final dividend - for the year ended 28 April 2019 - of 24.4 pence, however, the register closed to participants on the 9 August (i.e. if you buy now you don't get the div).  

Purchasing the Publican 2: Greene King as Target

Travis Lundy

On 18th July, TDR-owned UK pub company Stonegate and UK's largest pub company <a href="https://www.smartkarma.com/entities/enterprise-inns-plc" target="_blank" data-smartkarma-citation="entities:21924:1" rel="noopener">EI Group (EIG LN)</a>  <a href="https://secure.eigroupplc.com/recommended-offer/media/2-7-Announcement.pdf" target="_blank" rel="noopener">announced</a> that they have reached an agreement for Stonegate to acquire its larger rival EI Group at a cash consideration of 285 pence per EIG share, which translates to an Enterprise Value of £2.97bn and an equity value of £1.27bn. That equity value is the highest since before the GFC. 
The offer price translates to strong premiums of 38.5% and 37.7% to the pre-announcement closing price and the 6-month VWAP respectively. In addition to this, the offer price is also 26.8% higher than EIG's 10-year high of 224.8 pence which was achieved in May 2019. 
EIG's shareholders will see this as a favorable exit opportunity given the challenges the company has been facing due to the rising labor and operating costs, changing consumer dynamics and the negative impact of the revisions to the 'beer tie' rules in 2016. At the time of writing, EIG's shares are trading very close to terms. 
The deal is conditional on the receipt of approval from EIG's Shareholders (representing at least 75% of the votes cast at the GM), European Commission and/or CMA anti-trust clearances and regulatory clearances from the FCA. The Acquisition is expected to become effective in the first quarter of 2020.

On 18th July, TDR-owned UK pub company Stonegate and UK's largest pub company EI Group (EIG LN)  announced that they have reached an agreement for Stonegate to acquire its larger rival EI Group at a cash consideration of 285 pence per EIG share, which translates to an Enterprise Value of £2.97bn and an equity value of £1.27bn. That equity value is the highest since before the GFC. 
The offer price translates to strong premiums of 38.5% and 37.7% to the pre-announcement closing price and the 6-month VWAP respectively. In addition to this, the offer price is also 26.8% higher than EIG's 10-year high of 224.8 pence which was achieved in May 2019. 
EIG's shareholders will see this as a favorable exit opportunity given the challenges the company has been facing due to the rising labor and operating costs, changing consumer dynamics and the negative impact of the revisions to the 'beer tie' rules in 2016. At the time of writing, EIG's shares are trading very close to terms. 
The deal is conditional on the receipt of approval from EIG's Shareholders (representing at least 75% of the votes cast at the GM), European Commission and/or CMA anti-trust clearances and regulatory clearances from the FCA. The Acquisition is expected to become effective in the first quarter of 2020. 

Purchasing the Publican: EI Group as Target

United Kingdom

EI Group PLC owns tenanted and leased pubs in the United Kingdom. The Company leases pubs to individual operators supplying them with beer and other products. EI offers its services to individuals throughout the United Kingdom.

EI Group (EIG LN)

(Mostly) Asia M&A: November 2019 Roundup

For the month of November, 21 new deals were discussed on Smartkarma with an overall announced deal size of ~US$75bn, helped in large part by...

David Blennerhassett

Purchasing the Publican 2: Greene King as Target

On 18th July, TDR-owned UK pub company Stonegate and UK's pub company EI Group (EIG LN) announced that they had reached an agreement for Stonegate...

David Blennerhassett

Purchasing the Publican: EI Group as Target

On 18th July, TDR-owned UK pub company Stonegate and UK's largest pub company EI Group (EIG LN) announced that they have reached an agreement for...

Travis Lundy