Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Capital Markets

Lotte Global Logistics / Equity Capital Markets

<ul>
<li>Lotte Global Logistics is getting ready to complete its IPO in KOSPI in May 2025. IPO price range is from 11,500 won and 13,500 won.</li>
<li>At the high end of the IPO price range, the expected public offering amount is 202 billion won.</li>
<li>According to the bankers' valuation, the expected market cap after the IPO is 479 billion won to 562 billion won. </li>
</ul>


Lotte Global Logistics is getting ready to complete its IPO in KOSPI in May 2025. IPO price range is from 11,500 won and 13,500 won.
At the high end of the IPO price range, the expected public offering amount is 202 billion won.
According to the bankers' valuation, the expected market cap after the IPO is 479 billion won to 562 billion won. 


Equity Bottom-Up

<p>It has been reported in the past few days that <a href="https://finance.naver.com/item/news_read.nhn?article_id=0000715983&amp;office_id=366&amp;code=180640&amp;sm=title_entity_id.basic" target="_blank" rel="noopener">Cho Hyun-Ah</a> sold 12 billion won worth ($1.1 million) of <a href="https://www.smartkarma.com/entities/hanjin-kal-corp" target="_blank" data-smartkarma-citation="entities:19086:1" rel="noopener">Hanjin KAL Corp (180640 KS)</a> shares in 2021. It appears that one of the reasons why she may have sold these shares was to pay for the inheritance tax of the late Hanjin Group Chairman Cho Yang-Ho. Cho Hyun-Ah needs to pay a total of nearly 60 billion won in inheritance taxes, broken down into 12 billion won payment per year.</p><p>Although Korean Air has been infused with new, fresh capital, it is not all certain whether the company will best use the resources in the best ways possible. In other words, she may be waiting for her brother to make another mistake in managing the company. If one or two years later if enough shareholders decide that Cho Won-Tae and his assigned managers are not acting in the best interest of the shareholders, then his sister Cho Hyun-Ah may be waiting for an another shareholders battle against his brother. </p><p>All in all, from a pair-trade perspective, the short term momentum is on the side of long Hanjin Kal and short Korean Air, which has worked so far since the end of the ban on many Korean stocks starting May 3. Given the huge price disparity between these two stocks in the past year, we think that this could be a nice trade as many investors look to close the gap on the two prices which have diverged greatly in the past year.</p>

It has been reported in the past few days that Cho Hyun-Ah sold 12 billion won worth ($1.1 million) of Hanjin KAL Corp (180640 KS) shares in 2021. It appears that one of the reasons why she may have sold these shares was to pay for the inheritance tax of the late Hanjin Group Chairman Cho Yang-Ho. Cho Hyun-Ah needs to pay a total of nearly 60 billion won in inheritance taxes, broken down into 12 billion won payment per year.Although Korean Air has been infused with new, fresh capital, it is not all certain whether the company will best use the resources in the best ways possible. In other words, she may be waiting for her brother to make another mistake in managing the company. If one or two years later if enough shareholders decide that Cho Won-Tae and his assigned managers are not acting in the best interest of the shareholders, then his sister Cho Hyun-Ah may be waiting for an another shareholders battle against his brother. All in all, from a pair-trade perspective, the short term momentum is on the side of long Hanjin Kal and short Korean Air, which has worked so far since the end of the ban on many Korean stocks starting May 3. Given the huge price disparity between these two stocks in the past year, we think that this could be a nice trade as many investors look to close the gap on the two prices which have diverged greatly in the past year.

Hanjin Kal: Why Is Cho Hyun-Ah Selling A Partial Stake?

Event-Driven

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<p><strong>It is not often that a Korean company goes activist on another publicly listed company so it pays attention to this new development where HYK Partners (with major investment backing from </strong><strong><a href="https://www.smartkarma.com/entities/kyungbang-ltd" target="_blank" data-smartkarma-citation="entities:16840:1" rel="noopener">Kyungbang Ltd (000050 KS)</a>) has publicly declared that it is going activist on <a href="https://www.smartkarma.com/entities/hanjin-transportation-co" target="_blank" data-smartkarma-citation="entities:12583:1" rel="noopener">Hanjin Transportation Co (002320 KS)</a>. </strong></p>
<p><a href="https://www.smartkarma.com/entities/hanjin-transportation-co" target="_blank" data-smartkarma-citation="entities:12583:1" rel="noopener">Hanjin Transportation Co (002320 KS)</a> is an interesting stock right now. Its fundamentals are improving as evidenced by higher sales and profits of its delivery/parcel, shipping, and unloading services. Plus, HYK Partners is going activist on Hanjin Transportation. Another hedge fund (KCGI) has been reducing its stake in Hanjin Transportation (down to 9.79% as of 6 November). There may be an increasing possibility that HYK Partners could partner with KCGI in trying to improve corporate governance of Hanjin Transportation. Meanwhile, Hanjin Transportation is trading at only 0.7x P/B. Overall, we think that there are numerous positive catalysts with Hanjin Transportation and it is a stock that we believe could outperform the market over the next 6-12 months. </p>
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It is not often that a Korean company goes activist on another publicly listed company so it pays attention to this new development where HYK Partners (with major investment backing from Kyungbang Ltd (000050 KS)) has publicly declared that it is going activist on Hanjin Transportation Co (002320 KS). 
Hanjin Transportation Co (002320 KS) is an interesting stock right now. Its fundamentals are improving as evidenced by higher sales and profits of its delivery/parcel, shipping, and unloading services. Plus, HYK Partners is going activist on Hanjin Transportation. Another hedge fund (KCGI) has been reducing its stake in Hanjin Transportation (down to 9.79% as of 6 November). There may be an increasing possibility that HYK Partners could partner with KCGI in trying to improve corporate governance of Hanjin Transportation. Meanwhile, Hanjin Transportation is trading at only 0.7x P/B. Overall, we think that there are numerous positive catalysts with Hanjin Transportation and it is a stock that we believe could outperform the market over the next 6-12 months. 


HYK Partners (Kyungbang) Goes Activist on Hanjin Transportation

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Melco International Development / Event-Driven

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<p>This week in StubWorld ...</p>
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<p>Lawrence Ho has all-but sidestepped family succession issues since his father passed away earlier this year - Stanley fathered 17 children with four women, and I count at last three ongoing legal actions by the siblings  - and appears intent on developing his own brand. With <a href="https://www.smartkarma.com/entities/melco-international-development-ltd" target="_blank" data-smartkarma-citation="entities:809:1" rel="noopener">Melco International Development (200 HK)</a> languishing around its NAV lows, will he simply continue to (gradually) increase his stake in Melco, or propose a major restructuring. </p>
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<p>Preceding my comments on Toyota and Melco, are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<div class="content-remarks">
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...



Lawrence Ho has all-but sidestepped family succession issues since his father passed away earlier this year - Stanley fathered 17 children with four women, and I count at last three ongoing legal actions by the siblings  - and appears intent on developing his own brand. With Melco International Development (200 HK) languishing around its NAV lows, will he simply continue to (gradually) increase his stake in Melco, or propose a major restructuring. 



Preceding my comments on Toyota and Melco, are the weekly setup/unwind tables for Asia-Pacific Holdcos.





These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.




StubWorld: Melco (200 HK) At NAV Trough Levels

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Hanjin Transportation Co / Equity Capital Markets

<p>Hanjin Kal's other subsidiary, Hanjin T, also goes for an offering.</p><p>It offers 2.97M shares at a capital increase rate of 24.83%.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/151/560/original/1.png?1597000642" class="editor-image img-responsive" data-smartkarma-image-id="151560"></figure><p>80% goes to the stockholders, so the per share allocation is 0.2.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/151/561/original/2.png?1597000655" class="editor-image img-responsive" data-smartkarma-image-id="151561"></figure><p>This offering proceeds pretty much simultaneously with Jin Air's event, only three days apart between them.</p><p>September 16 will be the first round pricing, followed by the ex-rights two trading days later. The subscription rights will be trading on October 13~19.</p><p>We will have a final price on October 23, then followed by a subscription on October 28. Listing is November 18.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/151/562/original/3.png?1597001581" class="editor-image img-responsive" data-smartkarma-image-id="151562"></figure><p>There is nothing unusual in pricing. This one also carries a usual 20% discount.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/151/563/original/5.png?1597001591" class="editor-image img-responsive" data-smartkarma-image-id="151563"></figure>

Hanjin Kal's other subsidiary, Hanjin T, also goes for an offering.It offers 2.97M shares at a capital increase rate of 24.83%.80% goes to the stockholders, so the per share allocation is 0.2.This offering proceeds pretty much simultaneously with Jin Air's event, only three days apart between them.September 16 will be the first round pricing, followed by the ex-rights two trading days later. The subscription rights will be trading on October 13~19.We will have a final price on October 23, then followed by a subscription on October 28. Listing is November 18.There is nothing unusual in pricing. This one also carries a usual 20% discount.

Hanjin Trnspt Rights Offer: Trading Dynamics with Maj Shareholder's 150% Over-Subscription

South Korea

Hanjin Transportation Co., Ltd. provides integrated transportation and logistics services.  The Company operates truck transportation, stevedoring, coastal shipping, passenger buses, and international freight services.

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Hanjin Transportation Co (002320 KS)

Lotte Global Logistics IPO Preview

Lotte Global Logistics is getting ready to complete its IPO in KOSPI in May 2025. According to the bankers' valuation, the expected market cap...

Douglas Kim

Hanjin Kal: Why Is Cho Hyun-Ah Selling A Partial Stake?

From a pair-trade perspective, the short term momentum is on the side of long Hanjin Kal and short Korean Air, which has worked so far since the...

Douglas Kim

HYK Partners (Kyungbang) Goes Activist on Hanjin Transportation

HYK Partners (with major investment backing from Kyungbang Ltd (000050 KS)) has publicly declared that it is going activist on Hanjin...

Douglas Kim

StubWorld: Melco (200 HK) At NAV Trough Levels

his week in StubWorld ... Commercial real estate (in the world's most expensive city) - check. Hotel exposure - check. Marine services -...

David Blennerhassett

Hanjin Trnspt Rights Offer: Trading Dynamics with Maj Shareholder's 150% Over-Subscription

Hanjin Kal's other subsidiary, Hanjin T, also goes for an offering.It offers 2.97M shares at a capital increase rate of 24.83%.80% goes to the...

Sanghyun Park

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