Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>In March 2022, <a href="https://www.smartkarma.com/entities/toyo-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:1176:1" rel="noopener">Toyo Construction (1890 JP)</a> agreed to be taken over by equity affiliate stake owner <a href="https://www.smartkarma.com/entities/infroneer-holdings-inc" target="_blank" data-smartkarma-citation="entities:35785:1" rel="noopener">INFRONEER Holdings (5076 JP)</a> at what was a low price.</li>
<li>Nintendo Founder Family Office "YFO" objected, and bought 25+% of the company, then offered to buy it out 30% higher. Toyo Construction objected.</li>
<li>Four months later they finally signed an NDA and then started negotiating. Early in November the target date for a Tender Offer start by YFO was pushed to early December.</li>
</ul>


In March 2022, Toyo Construction (1890 JP) agreed to be taken over by equity affiliate stake owner INFRONEER Holdings (5076 JP) at what was a low price.
Nintendo Founder Family Office "YFO" objected, and bought 25+% of the company, then offered to buy it out 30% higher. Toyo Construction objected.
Four months later they finally signed an NDA and then started negotiating. Early in November the target date for a Tender Offer start by YFO was pushed to early December.


Toyo Construction (1890) - Creeping Up On The Next "Tender Offer Start Date"..... Uh.... Maybe

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>At the October rebalance, there are 970 stocks that will have a lower FFW while 114 stocks will have a higher FFW. 493 stocks will undergo a Phased Weight Reduction.</li>
<li>Estimated one-way turnover is 2.54% resulting in a one-way trade of ¥1.815tn. 500 stocks have over 4 days ADV to trade, 100 stocks have over 9 days ADV to trade.</li>
<li>Setting the threshold at +/-US$50m to trade, the stocks with inflows have outperformed the stocks with outflows by 6.5% over the last four months.</li>
</ul>


At the October rebalance, there are 970 stocks that will have a lower FFW while 114 stocks will have a higher FFW. 493 stocks will undergo a Phased Weight Reduction.
Estimated one-way turnover is 2.54% resulting in a one-way trade of ¥1.815tn. 500 stocks have over 4 days ADV to trade, 100 stocks have over 9 days ADV to trade.
Setting the threshold at +/-US$50m to trade, the stocks with inflows have outperformed the stocks with outflows by 6.5% over the last four months.


TOPIX October Rebalance: BIG One With ¥1.8tn a Side to Trade

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sbi-holdings-inc" target="_blank" data-smartkarma-citation="entities:10928:1" rel="noopener">SBI Holdings (8473 JP)</a>'s subsidiary has <a href="https://www3.nhk.or.jp/news/html/20220930/k10013843881000.html" target="_blank" rel="noopener">reportedly</a> filed its application to become a Bank Holding Company, the definition being a company holding a 50% or greater stake in a bank.</li>
<li>The day after I last wrote, Shinsei <a href="https://www.shinseibank.com/corporate/en/news/pdf/pdf2022/221003_corporatenameLP_e.pdf" target="_blank" rel="noopener">announced</a> it had received approval to change its name to SBI Shinsei Bank as of 4 January 2023.</li>
<li>My expectation is the move above 50% happens sooner rather than later. And in that case, investors should think about their approach. Get your cowbells ready.</li>
</ul>



SBI Holdings (8473 JP)'s subsidiary has reportedly filed its application to become a Bank Holding Company, the definition being a company holding a 50% or greater stake in a bank.
The day after I last wrote, Shinsei announced it had received approval to change its name to SBI Shinsei Bank as of 4 January 2023.
My expectation is the move above 50% happens sooner rather than later. And in that case, investors should think about their approach. Get your cowbells ready.


Thinking Strategically About a Shinsei Position - Things To Do NOW

<ul>
<li>On Friday, post-close, there was a flurry of excitement as YFO put out a press release amending the start date of the planned Tender Offer to early November.</li>
<li>Not long after, there was another release by <a href="https://www.smartkarma.com/entities/toyo-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:1176:1" rel="noopener">Toyo Construction (1890 JP)</a> itself. </li>
<li>You have to read both for what they are. And as they say.... Get your programs here!</li>
</ul>


On Friday, post-close, there was a flurry of excitement as YFO put out a press release amending the start date of the planned Tender Offer to early November.
Not long after, there was another release by Toyo Construction (1890 JP) itself. 
You have to read both for what they are. And as they say.... Get your programs here!


Toyo Construction (1890 JP) - There's Nuance in Them Thar Press Releases

Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

<ul>
<li>JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.</li>
<li>A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.</li>
<li>Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in <em>August 2023</em> based on trading data as of end-<em>August 2022</em>.</li>
</ul>


JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2023 based on trading data as of end-August 2022.


Japan

INFRONEER Holdings Inc. offers infrastructure construction services. The Company provides energy construction, road construction, airport construction, exhibition hall construction, and more. INFRONEER Holdings also produces construction equipment.

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INFRONEER Holdings (5076 JP)

Toyo Construction (1890) - Creeping Up On The Next "Tender Offer Start Date"..... Uh.... Maybe

YFO's next scheduled "tender start date" is in early December, but the early November update was not exactly bullish on the prospects. They weren't...

Travis Lundy

TOPIX October Rebalance: BIG One With ¥1.8tn a Side to Trade

Lower FFWs on 970 stocks and higher FFWs on 114 stocks will result in one-way turnover of 2.52% leading to a one-way trade of ¥1.8tn at the close...

Brian Freitas

Thinking Strategically About a Shinsei Position - Things To Do NOW

Shinsei Bank may be in its last throes of independence. Shareholders usually do not get the chance to pester the Board before a price is...

Travis Lundy

Toyo Construction (1890 JP) - There's Nuance in Them Thar Press Releases

Toyo Const suitor YFO put out a press release which was boilperplate in its fact and interesting in its detail. Toyo also released a statement,...

Travis Lundy

JPX-Nikkei 400 Rebal 2023: End-Aug 2022

Some Potential ADDs have underperformed their EPS Trends and Potential DELs have outperformed their EPS trends and this makes the LONG Potential...

Janaghan Jeyakumar, CFA

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