Doing bespoke work since 2002....., Custom Products Group

Patrick Hansen

Doing bespoke work since 2002.....

Custom Products Group

Custom Products was started 14 years ago at Lehman Brothers by current co-founder Patrick Hansen, CFA. After 3 years at Lehman, Patrick moved the team to Macquarie Securities where Simon Rigney (co-founder) joined. 3 years ago we took Custom Products independent. 

Our core strength can be summed up three words. 1- Customization - we have very little off the shelf products and most work is done on a one on one bespoke basis. 2- Speed - We pride ourselves in our ability to get requests back to the client very quickly. 3- Confidentiality - We do not redistribute. There is no grace period where we wait a week and then mass blast. Any request stops with that client.

Thematic (Sector/Industry)

<p>With a good portion of Japanese companies having already announced 1H results, we looked at the names that are well positioned for the second half. Names that could potentially beat full-year estimates. We basically screened for names that have already achieved greater than 60% of full-year consensus OP estimates and have also increased full-year Company OP guidance in the last month. </p><h2>Screen Criteria</h2><ol>
<li>Mkt-cap above ¥50bn</li>
<li>Fiscal year ending on March 31</li>
<li>Greater than 60% of full-year OP consensus is…</li>
</ol>

With a good portion of Japanese companies having already announced 1H results, we looked at the names that are well positioned for the second half. Names that could potentially beat full-year estimates. We basically screened for names that have already achieved greater than 60% of full-year consensus OP estimates and have also increased full-year Company OP guidance in the last month. Screen Criteria
Mkt-cap above ¥50bn
Fiscal year ending on March 31
Greater than 60% of full-year OP consensus is…


Names Potentially Well Positioned to Beat Year-End Estimates

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>When Makino Milling tried to block Nidec's bid but Nidec ran into approvals risk, and MBK stepped in as an alternate bidder. </li>
<li>The fact that Nidec seemed to run into China approval problems but MBK did not perhaps should have been something of a warning. Delays in Japan approvals definitely were. </li>
<li>Now the Japanese government has asked MBK to withdraw citing national security concerns according to the <a href="https://asia.nikkei.com/business/companies/japan-moves-to-block-mbk-s-makino-machine-tool-takeover-on-security-grounds" target="_blank" rel="noopener">Nikkei</a>.  First post-New-FEFTA deal block. </li>
</ul>


When Makino Milling tried to block Nidec's bid but Nidec ran into approvals risk, and MBK stepped in as an alternate bidder. 
The fact that Nidec seemed to run into China approval problems but MBK did not perhaps should have been something of a warning. Delays in Japan approvals definitely were. 
Now the Japanese government has asked MBK to withdraw citing national security concerns according to the Nikkei.  First post-New-FEFTA deal block. 


[Japan M&A] Japan Govt Quashes MBK Bid for Makino Milling (6135) - Foreign Buys of Sensitives Toast?

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>The <a href="https://asia.nikkei.com/business/companies/japan-moves-to-block-makino-machine-tool-takeover-on-security-concerns" target="_blank" rel="noopener">Nikkei reported</a> that the Japanese government has advised MBK to halt its acquisition ‌of <a href="https://www.smartkarma.com/entities/makino-milling-machine-co" target="_blank" data-smartkarma-citation="entities:5200:1" rel="noopener">Makino Milling Machine Co (6135 JP)</a> on national security grounds.</li>
<li>This event sets a precedent and will increase the risk premium for foreign takeovers of Japanese companies in core business sectors. FEFTA approval can no longer be considered low-risk.</li>
<li>Due to a significant re-rating of peers/index and Makino’s upgraded forecasts since the offer announcement, the share price fall on a deal break is likely to be modest (&lt;10%). </li>
</ul>


The Nikkei reported that the Japanese government has advised MBK to halt its acquisition ‌of Makino Milling Machine Co (6135 JP) on national security grounds.
This event sets a precedent and will increase the risk premium for foreign takeovers of Japanese companies in core business sectors. FEFTA approval can no longer be considered low-risk.
Due to a significant re-rating of peers/index and Makino’s upgraded forecasts since the offer announcement, the share price fall on a deal break is likely to be modest (&lt;10%). 


Makino Milling Machine (6135 JP): Precedent Set as FEFTA Approval Is Rumoured to Be Not Forthcoming

<ul>
<li>Due to the delay in securing FEFTA approval, <a href="https://www.smartkarma.com/entities/makino-milling-machine-co" target="_blank" data-smartkarma-citation="entities:5200:1" rel="noopener">Makino Milling Machine Co (6135 JP)</a> has announced that the start of the MBK tender offer has been delayed to late June. </li>
<li>Makino is classified as a Type 3 company (core business), suggesting that MBK is negotiating undertakings to secure FEFTA approval.</li>
<li>Despite mitigating factors, the case for a bump is increasingly persuasive given peers' material reratings, Makino’s solid financial performance and lack of irrevocables.  </li>
</ul>


Due to the delay in securing FEFTA approval, Makino Milling Machine Co (6135 JP) has announced that the start of the MBK tender offer has been delayed to late June. 
Makino is classified as a Type 3 company (core business), suggesting that MBK is negotiating undertakings to secure FEFTA approval.
Despite mitigating factors, the case for a bump is increasingly persuasive given peers' material reratings, Makino’s solid financial performance and lack of irrevocables.  


Makino Milling Machine (6135 JP): Tender Delayed as the Case for a Bump Is Becoming Persuasive

Founder and CEO, Europacifica Consulting

Naomi Fink

Founder and CEO

Europacifica Consulting

Macroeconomics

<p>Empirical data on the drivers of Japanese productivity are sadly not at the forefront of Abenomics, but they should be.  Europacifica CEO Naomi Fink has published, over the last year, two papers with Columbia University's CJEB which show exactly why this is.  The first of these papers illustrates why and where we find evidence that the BOJ's fight against deflation is insufficient (although it may be necessary) to cure Japan's ills:</p><h2>Why Overcoming Deflation Alone is Not Enough</h2><p>There is "bad…</p>

Empirical data on the drivers of Japanese productivity are sadly not at the forefront of Abenomics, but they should be.  Europacifica CEO Naomi Fink has published, over the last year, two papers with Columbia University's CJEB which show exactly why this is.  The first of these papers illustrates why and where we find evidence that the BOJ's fight against deflation is insufficient (although it may be necessary) to cure Japan's ills:Why Overcoming Deflation Alone is Not EnoughThere is "bad…

Japan Non-IT Industries: Overcoming Deflation Not Enough

Japan

Electric Power Development Co.,Ltd. generates, transmits, distributes, and sells electric power using hydroelectric, wind-power, nuclear, coal-fired and other thermal power stations throughout Japan.

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Electric Power Development C (9513 JP)

Names Potentially Well Positioned to Beat Year-End Estimates

With a good portion of Japanese companies having already announced 1H results, we looked at the names that are well positioned for the second half....

Custom Products Group

[Japan M&A] Japan Govt Quashes MBK Bid for Makino Milling (6135) - Foreign Buys of Sensitives Toast?

A couple of hours after I wrote this, the Nikkei reported that domestic PE firm NSSK, which had been one of the white-knight bidders a year ago,...

Travis Lundy

Makino Milling Machine (6135 JP): Precedent Set as FEFTA Approval Is Rumoured to Be Not Forthcoming

FEFTA-related deal break is rare. Due to a significant re-rating of peers/index and upgraded forecasts since the offer announcement, the share...

Arun George

Makino Milling Machine (6135 JP): Tender Delayed as the Case for a Bump Is Becoming Persuasive

FEFTA approval should be forthcoming. Despite mitigating factors, the case for a bump is increasingly persuasive given peers' material reratings,...

Arun George

Japan Non-IT Industries: Overcoming Deflation Not Enough

Empirical data on the drivers of Japanese productivity are sadly not at the forefront of Abenomics, but they should be. Europacifica CEO Naomi...

Naomi Fink

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