Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Should the nominated directors, to be voted on by <a href="https://www.smartkarma.com/entities/eoflow-co-ltd" target="_blank" data-smartkarma-citation="entities:36100:1" rel="noopener">EOFlow (294090 KS)</a>'s shareholders at the November EGM, include <a href="https://www.smartkarma.com/entities/medtronic-plc" target="_blank" data-smartkarma-citation="entities:14982:1" rel="noopener">Medtronic Plc (MDT US)</a> executives, then game on.</li>
<li>
<a href="https://www.smartkarma.com/entities/fast-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:751:1" rel="noopener">Fast Retailing (9983 JP)</a> STILL has a Nikkei 225 problem, which means it probably has to underperform Nikkei 225 slightly between now and the Base Date (31 July 2024).</li>
<li>
<a href="https://www.smartkarma.com/entities/jmdc-inc" target="_blank" data-smartkarma-citation="entities:28673:1" rel="noopener">JMDC (4483 JP)</a> has been one of the more annoying partial tenders out there. Even post-facto, it is tough to know what the disposition was. This is extraordinarily vexing.</li>
</ul>


Should the nominated directors, to be voted on by EOFlow (294090 KS)'s shareholders at the November EGM, include Medtronic Plc (MDT US) executives, then game on.

Fast Retailing (9983 JP) STILL has a Nikkei 225 problem, which means it probably has to underperform Nikkei 225 slightly between now and the Base Date (31 July 2024).

JMDC (4483 JP) has been one of the more annoying partial tenders out there. Even post-facto, it is tough to know what the disposition was. This is extraordinarily vexing.


Last Week In Event SPACE: EOFlow, Fast Retailing, JMDC, Origin Energy

European Event-Driven Analyst

Jesus Rodriguez Aguilar

<ul>
<li>CMB and <a href="https://www.smartkarma.com/entities/frontline-ltd-bermuda-95b052f6-1b1b-4c75-87d8-8286563cb605" target="_blank" data-smartkarma-citation="entities:15531:1" rel="noopener">Frontline Ltd (FRO US)</a> smoke the peace pipe: CMB will buy Frontline out of <a href="https://www.smartkarma.com/entities/euronav-nv" target="_blank" data-smartkarma-citation="entities:21077:1" rel="noopener">Euronav NV (EURN US)</a> at $18.43/share (25% premium) and agree to Euronav selling 24 VLCCs to FRO.</li>
<li>After an EGM gives the green light, CMB will launch a mandatory $18.43/share cash offer for Euronav. The three-way transaction is fairly priced (1.0x P/NAV) for all players, including the Euronav minorities.</li>
<li>There shouldn't be any antitrust issues. Spread is 4.02%/7.66% (gross/annualised assuming settlement by 30 April 2024). Recommendation is long and tender (there won't be any squeeze-out).</li>
</ul>


CMB and Frontline Ltd (FRO US) smoke the peace pipe: CMB will buy Frontline out of Euronav NV (EURN US) at $18.43/share (25% premium) and agree to Euronav selling 24 VLCCs to FRO.
After an EGM gives the green light, CMB will launch a mandatory $18.43/share cash offer for Euronav. The three-way transaction is fairly priced (1.0x P/NAV) for all players, including the Euronav minorities.
There shouldn't be any antitrust issues. Spread is 4.02%/7.66% (gross/annualised assuming settlement by 30 April 2024). Recommendation is long and tender (there won't be any squeeze-out).


Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Index Rebalance

<ul>
<li>The March 2023 regular rebalance index changes for the SE600 index and the EUROSTX index were announced yesterday. </li>
<li>There are 8 ADDs/DELs for the SE600 index and 5 ADDs and 2 DELs for the EUROSTX index.</li>
<li>In this insight, we take a closer look at the index flow expectations and the historical performance of SE600 and EUROSTX Rebalance events.</li>
</ul>


The March 2023 regular rebalance index changes for the SE600 index and the EUROSTX index were announced yesterday. 
There are 8 ADDs/DELs for the SE600 index and 5 ADDs and 2 DELs for the EUROSTX index.
In this insight, we take a closer look at the index flow expectations and the historical performance of SE600 and EUROSTX Rebalance events.


SE600 Mar 23 Rebal: Final Changes and Historical Performance Analysis

Transport Sector, China and Asia-focused Research

Charles De Trenck

Tanker shares probably showed up on many aggressive investor stock screens in the last couple of days. But the trade has been on a couple of times recently. And just about came back to its recent starting point a few days ago, in some cases. That is how steep some of the sell-offs were. But the overall original trade probably started when oil made its big decline. We can delineate the trades pretty clearly, while also observing some names that have moved quickly against those still languishing somewhat. We look at some recent performances, better versus weaker trades.

Tanker shares probably showed up on many aggressive investor stock screens in the last couple of days. But the trade has been on a couple of times recently. And just about came back to its recent starting point a few days ago, in some cases. That is how steep some of the sell-offs were. But the overall original trade probably started when oil made its big decline. We can delineate the trades pretty clearly, while also observing some names that have moved quickly against those still languishing somewhat. We look at some recent performances, better versus weaker trades.

Ongoing Coverage: Tankers in Sweet Spot of Negative Correlation to Oil... Share Rebounds

Equity Analyst

Nikesh Shukla

Maritime Sector, Equity & Credit Research

Drewry Maritime Financial Research

With no ties to other players in the shipping, finance or banking world, we provide a uniquely impartial view of the markets and companies we cover. Our parent organization, Drewry is a leading independent provider of research services to the maritime and shipping industry, employing over 100 professionals across an international network of offices in London, Delhi, Singapore and Shanghai. Combining our market-leading resources with seasoned sector expertise DFRS offers a highly differentiated and comprehensive range of investment and financial research services to lenders and prospective investors in publicly listed maritime and shipping companies. The full service of reports, supporting resources and sector orientated webinars provides our clients with the most complete picture of the organisations under coverage as is possible. We have been charting and analysing the world’s maritime markets for more than 40 years. This unrivalled intelligence and understanding provides the foundation of our research service. Our analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.

Equity Bottom-Up

The worst is behind us We believe that we have reached the bottom of the crude tanker shipping market. While we don’t expect rates to reach anywhere close to the levels seen in 2015 later this year, we believe that the ingredients are in place for the market to see a gradual improvement in vessel earnings over the next two years. Beyond that, an improvement in earnings will be predicated how the orderbook evolves as well as on OPEC’s production levels which are currently not at a level sufficient to employ crude tankers at profitable levels.

The worst is behind us We believe that we have reached the bottom of the crude tanker shipping market. While we don’t expect rates to reach anywhere close to the levels seen in 2015 later this year, we believe that the ingredients are in place for the market to see a gradual improvement in vessel earnings over the next two years. Beyond that, an improvement in earnings will be predicated how the orderbook evolves as well as on OPEC’s production levels which are currently not at a level sufficient to employ crude tankers at profitable levels.

Is It Time to Bottom-Fish Crude Tanker Stocks?

Norway

Frontline PLC owns a fleet of very large crude carriers and tankers that transport crude oil and oil products between ports. The Company's vessels are managed by ship management companies. Frontline conducts activities worldwide.

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Frontline (FRO US)

Last Week In Event SPACE: EOFlow, Fast Retailing, JMDC, Origin Energy

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

CMB/Euronav: Mandatory Offer

After an EGM gives the green light, CMB will launch a mandatory $18.43/share cash offer for Euronav. The three-way transaction is fairly priced for...

Jesus Rodriguez Aguilar

SE600 Mar 23 Rebal: Final Changes and Historical Performance Analysis

The SHORT DELs - LONG Index trade seems interesting as historically the DELs have strongly outperformed the index from announcement to exclusion.

Janaghan Jeyakumar, CFA

Is It Time to Bottom-Fish Crude Tanker Stocks?

The worst is behind usWe believe that we have reached the bottom of the crude tanker shipping market. While we don’t expect rates to reach anywhere...

Drewry Maritime Financial Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Last Week In Event SPACE: EOFlow, Fast Retailing, JMDC, Origin Energy

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

CMB/Euronav: Mandatory Offer

After an EGM gives the green light, CMB will launch a mandatory $18.43/share cash offer for Euronav. The three-way transaction is fairly priced for...

Jesus Rodriguez Aguilar

SE600 Mar 23 Rebal: Final Changes and Historical Performance Analysis

The SHORT DELs - LONG Index trade seems interesting as historically the DELs have strongly outperformed the index from announcement to exclusion.

Janaghan Jeyakumar, CFA

Ongoing Coverage: Tankers in Sweet Spot of Negative Correlation to Oil... Share Rebounds

Tanker shares probably showed up on many aggressive investor stock screens in the last couple of days. But the trade has been on a couple of times...

Charles De Trenck

Is It Time to Bottom-Fish Crude Tanker Stocks?

The worst is behind usWe believe that we have reached the bottom of the crude tanker shipping market. While we don’t expect rates to reach anywhere...

Drewry Maritime Financial Research