Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Hitachi has been in the process of selling <a href="https://www.smartkarma.com/entities/hitachi-transport-system-ltd" target="_blank" data-smartkarma-citation="entities:2395:1" rel="noopener">Hitachi Transport System (9086 JP)</a>. An article in the Nikkei Thursday last suggested a deal was imminent (both companies report 28 April). </li>
<li>Bloomberg carried an article this morning with more numbers and implied arithmetic. Then they revised the language in the article. </li>
<li>There is STILL room for different interpretations of likely deal price if one tries to parse all the info provided and match it with history. But we may be there.</li>
</ul>


Hitachi has been in the process of selling Hitachi Transport System (9086 JP). An article in the Nikkei Thursday last suggested a deal was imminent (both companies report 28 April). 
Bloomberg carried an article this morning with more numbers and implied arithmetic. Then they revised the language in the article. 
There is STILL room for different interpretations of likely deal price if one tries to parse all the info provided and match it with history. But we may be there.


Hitachi Transport (9086 JP) - Deciphering Takeover Price by Newspaper Article Language

<ul>
<li>The Nikkei Leak Article of the Hitachi Transport takeover price is out. That suggests board meetings and deal announcement are imminent</li>
<li>The price suggested in the article comes out to be just under ¥8,000. </li>
<li>Past deals between KKR and Hitachi for Hitachi subs (and the language of the article on deal structure) suggest the minority Tender Offer Price could be different.</li>
</ul>


The Nikkei Leak Article of the Hitachi Transport takeover price is out. That suggests board meetings and deal announcement are imminent
The price suggested in the article comes out to be just under ¥8,000. 
Past deals between KKR and Hitachi for Hitachi subs (and the language of the article on deal structure) suggest the minority Tender Offer Price could be different.


Hitachi Transport (9086) Takeover Deal Imminent

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hitachi-transport-system-ltd" target="_blank" data-smartkarma-citation="entities:2395:1" rel="noopener">Hitachi Transport System (9086 JP)</a> has been "virtually" for sale since October 2019 but it did not pop when others did then. But SG and HTS "consciously uncoupled" in 2020.</li>
<li>Mid-Year last year saw news HTS was entertaining offers, which didn't go anywhere but newer news suggests Round 2 of a new course of bidding is done. </li>
<li>And the stock keeps on going up and up and up.</li>
</ul>



Hitachi Transport System (9086 JP) has been "virtually" for sale since October 2019 but it did not pop when others did then. But SG and HTS "consciously uncoupled" in 2020.
Mid-Year last year saw news HTS was entertaining offers, which didn't go anywhere but newer news suggests Round 2 of a new course of bidding is done. 
And the stock keeps on going up and up and up.


Hitachi Transport Is the Eventy Energizer Bunny

<ul>
<li>This should come as no surprise. <a href="https://www.smartkarma.com/entities/nagoya-railroad-co-ltd" target="_blank" data-smartkarma-citation="entities:8652:1" rel="noopener">Nagoya Railroad (9048 JP)</a> is buying out minorities in logistics unit <a href="https://www.smartkarma.com/entities/meitetsu-transport-co-ltd" target="_blank" data-smartkarma-citation="entities:1475:1" rel="noopener">Meitetsu Transport (9077 JP)</a>.  </li>
<li>Given the shareholder structure, this can be done and squeezed out with not a single share tendered, but it's ugly. </li>
<li>Logistics REITs trade at 1.3-1.5x book. This is being done at 0.55x book where just 1.0x book for the warehouse assets would be more than the EV at Takeover Price.</li>
</ul>


This should come as no surprise. Nagoya Railroad (9048 JP) is buying out minorities in logistics unit Meitetsu Transport (9077 JP).  
Given the shareholder structure, this can be done and squeezed out with not a single share tendered, but it's ugly. 
Logistics REITs trade at 1.3-1.5x book. This is being done at 0.55x book where just 1.0x book for the warehouse assets would be more than the EV at Takeover Price.


Meitetsu Transport (9077) Takeover - Parent "Stealing" Logistics Assets at 0.55x Book

David Blennerhassett

<ul>
<li>An analysis of the shareholder register of<a href="https://www.smartkarma.com/entities/bhp-group-plc" target="_blank" data-smartkarma-citation="entities:28086:1" rel="noopener">BHP Group PLC (BHPBF US)</a> suggests that BHP has misunderestimated the passive ownership of PLC by a lot.</li>
<li>
<a href="https://www.smartkarma.com/entities/jardine-matheson-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19718:1" rel="noopener">Jardine Matheson Holdings (JM SP)</a> looks set to add to its coffers on talk it is negotiating the sale of KFC and Pizza Hut franchises. </li>
<li>How the mighty have fallen. <a href="https://www.smartkarma.com/entities/cathay-pacific-airways-ltd" target="_blank" data-smartkarma-citation="entities:243:1" rel="noopener">Cathay Pacific Airways (293 HK)</a> has gone from the de-facto flag carrier to the obligatory kicking bag.</li>
</ul>


An analysis of the shareholder register ofBHP Group PLC (BHPBF US) suggests that BHP has misunderestimated the passive ownership of PLC by a lot.

Jardine Matheson Holdings (JM SP) looks set to add to its coffers on talk it is negotiating the sale of KFC and Pizza Hut franchises. 
How the mighty have fallen. Cathay Pacific Airways (293 HK) has gone from the de-facto flag carrier to the obligatory kicking bag.


Last Week in Event SPACE: BHP, Jardine Matheson, Cathay Pacific, HK&S Hotels, Large CCASS Moves

Japan

Hitachi Transport System, Ltd. provides freight truck, port harbor, and marine transportation, logistics, cargo handling, warehousing, and customs clearing services.  The Company mainly transports Hitachi Ltd's freight such as industrial machinery and precision equipment.

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Hitachi Transport System (9086 JP)

Hitachi Transport (9086 JP) - Deciphering Takeover Price by Newspaper Article Language

Hitachi and Hitachi Transport (9086) report Thursday. I'd expect more details in the Nikkei on Thursday morning. In the meantime, we are probably...

Travis Lundy

Hitachi Transport (9086) Takeover Deal Imminent

The traditional Nikkei Leak Article is out, suggesting Hitachi will sell 30% for ¥200bn. Historically, Nikkei M&A arithmetic is sometimes off. But...

Travis Lundy

Hitachi Transport Is the Eventy Energizer Bunny

Hitachi Transport Systems (9086 JP) is up. It is up against peers in price, and in multiple terms (and down in terms of forward earnings...

Travis Lundy

Meitetsu Transport (9077) Takeover - Parent "Stealing" Logistics Assets at 0.55x Book

Meitetsu (9048) is taking out logistics subsidiary Meitetsu Transport (9077) at the wrong price. But it will probably get away with it.

Travis Lundy

Last Week in Event SPACE: BHP, Jardine Matheson, Cathay Pacific, HK&S Hotels, Large CCASS Moves

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

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