IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

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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.

Event-Driven

<ul>
<li>The <a href="https://www.smartkarma.com/entities/soft99-corp" target="_blank" data-smartkarma-citation="entities:18486:1" rel="noopener">Soft99 Corp (4464 JP)</a> Board has, unsurprisingly, opposed the Effissimo offer for several reasons. Notably, they do address the huge price disparity between the two offers. </li>
<li>While most of the reasons to justify the opposition are weak, the Board unexpectedly notes that as of 24 September, the MBO retained acceptances to satisfy its minimum tendering condition. </li>
<li>Despite the significant premium of the Effissimo offer, this development suggests that the current acceptances for the MBO are sticky, thereby increasing the likelihood that Effissimo’s offer will fail. </li>
</ul>


The Soft99 Corp (4464 JP) Board has, unsurprisingly, opposed the Effissimo offer for several reasons. Notably, they do address the huge price disparity between the two offers. 
While most of the reasons to justify the opposition are weak, the Board unexpectedly notes that as of 24 September, the MBO retained acceptances to satisfy its minimum tendering condition. 
Despite the significant premium of the Effissimo offer, this development suggests that the current acceptances for the MBO are sticky, thereby increasing the likelihood that Effissimo’s offer will fail. 


Soft99 Corp (4464 JP): The Board Opposes Effissimo’s Hostile Offer and Hints the MBO Will Succeed

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Yesterday, <a href="https://www.smartkarma.com/entities/soft99-corp" target="_blank" data-smartkarma-citation="entities:18486:1" rel="noopener">Soft99 Corp (4464 JP)</a> announced a slight change in its "Target Opinion Document" after the MBO Bidco extended its TOB by 8 days the day before. </li>
<li>The detail was not in the MBO Bidco extension. It was just revealed in an added note on p3 of the Target Opinion. </li>
<li>That details matters A LOT to people looking at the Effissimo Overbid. The company's Board has some serious work ahead. </li>
</ul>


Yesterday, Soft99 Corp (4464 JP) announced a slight change in its "Target Opinion Document" after the MBO Bidco extended its TOB by 8 days the day before. 
The detail was not in the MBO Bidco extension. It was just revealed in an added note on p3 of the Target Opinion. 
That details matters A LOT to people looking at the Effissimo Overbid. The company's Board has some serious work ahead. 


[Japan M&A/Activism] The Nagging Little Detail In the Soft99 MBO Extension Target Doc

<ul>
<li>Effissimo has formally launched its hostile tender offer for <a href="https://www.smartkarma.com/entities/soft99-corp" target="_blank" data-smartkarma-citation="entities:18486:1" rel="noopener">Soft99 Corp (4464 JP)</a> at JPY4,100, which is 66.3% higher than the MBO price of JPY2,465. </li>
<li>The Board stonewalled Effissimo’s attempts to negotiate a friendly offer. The huge premium of Effissimo’s offer relies on lower WACC assumptions compared to the target/special committee IFA.</li>
<li>Management’s initial approach will be to rely on the Board to oppose the Effissimo offer. There is a good chance that Soft99 will remain listed with two large shareholders. </li>
</ul>


Effissimo has formally launched its hostile tender offer for Soft99 Corp (4464 JP) at JPY4,100, which is 66.3% higher than the MBO price of JPY2,465. 
The Board stonewalled Effissimo’s attempts to negotiate a friendly offer. The huge premium of Effissimo’s offer relies on lower WACC assumptions compared to the target/special committee IFA.
Management’s initial approach will be to rely on the Board to oppose the Effissimo offer. There is a good chance that Soft99 will remain listed with two large shareholders. 


Soft99 Corp (4464 JP): Effissimo Sheds More Light on Its Hostile Offer

<ul>
<li>On 12 September, <a href="https://www.47news.jp/13147153.html" target="_blank" rel="noopener">Kyodo News</a> reported that Effissimo Capital Management will launch a competing tender offer for <a href="https://www.smartkarma.com/entities/soft99-corp" target="_blank" data-smartkarma-citation="entities:18486:1" rel="noopener">Soft99 Corp (4464 JP)</a> at JPY4,100, 66.3% higher than the JPY2,465 MBO offer.</li>
<li>The Effissimo offer structure has been designed to shine an unflattering spotlight on the MBO low-ball offer and to prevent management from privatising Soft99.  </li>
<li>The management has several options to respond. The initial play will likely be to lean on the special committee to question the feasibility of the Effissimo bid. </li>
</ul>


On 12 September, Kyodo News reported that Effissimo Capital Management will launch a competing tender offer for Soft99 Corp (4464 JP) at JPY4,100, 66.3% higher than the JPY2,465 MBO offer.
The Effissimo offer structure has been designed to shine an unflattering spotlight on the MBO low-ball offer and to prevent management from privatising Soft99.  
The management has several options to respond. The initial play will likely be to lean on the special committee to question the feasibility of the Effissimo bid. 


Soft99 Corp (4464 JP): Shock and Awe as Effissimo Emerges with a Competing Offer

David Blennerhassett

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zeekr-intelligent-technology-holding" target="_blank" data-smartkarma-citation="entities:36785:1" rel="noopener">ZEEKR (ZK US)</a> traded wide to the scrip terms ahead of <a href="https://www.smartkarma.com/entities/geely-automobile-holdings-ltd" target="_blank" data-smartkarma-citation="entities:127:1" rel="noopener">Geely Auto (175 HK)</a>'s EGM Vote. That was a buying opportunity. </li>
<li>A positive surprise as SAMR expediently signs off on the <a href="https://www.smartkarma.com/entities/hangzhou-kangji-medical-instrument-co-ltd" target="_blank" data-smartkarma-citation="entities:28938:1" rel="noopener">Hangzhou Kangji Medical Instrument Co., Ltd. (9997 HK)</a> transaction. This could be wrapped up before Xmas.</li>
<li>
<a href="https://www.smartkarma.com/entities/china-mobile-ltd" target="_blank" data-smartkarma-citation="entities:27:1" rel="noopener">China Mobile (941 HK)</a> comfortably clears the 50% conditional threshold into <a href="https://www.smartkarma.com/entities/hkbn-ltd" target="_blank" data-smartkarma-citation="entities:289:1" rel="noopener">HKBN Ltd (1310 HK)</a>; however compulsory acquisition appears out of reach</li>
</ul>



ZEEKR (ZK US) traded wide to the scrip terms ahead of Geely Auto (175 HK)'s EGM Vote. That was a buying opportunity. 
A positive surprise as SAMR expediently signs off on the Hangzhou Kangji Medical Instrument Co., Ltd. (9997 HK) transaction. This could be wrapped up before Xmas.

China Mobile (941 HK) comfortably clears the 50% conditional threshold into HKBN Ltd (1310 HK); however compulsory acquisition appears out of reach


Last Week In Event SPACE: ZEEKR/Geely, Kangji Medical, HKBN, Lynas, Huaxin Cement, Nidec

Japan

KeePer Technical Laboratory Co., Ltd. develops, manufactures, and sells car coatings, car washing chemicals and equipment. The Company also operates Keeper PROSHOP" certified car coating technology shops and "Keeper LABO" car coating and car wash specialty shops. KeePer Technical Laboratory conducts businesses in Japan.

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KeePer Technical Laboratory (6036 JP)

Soft99 Corp (4464 JP): The Board Opposes Effissimo’s Hostile Offer and Hints the MBO Will Succeed

Despite the significant premium of the Effissimo offer, the current acceptances for the MBO seem to be sticky, thereby increasing the likelihood...

Arun George

[Japan M&A/Activism] The Nagging Little Detail In the Soft99 MBO Extension Target Doc

The Effissimo Overbid for Soft99 is huge, groundbreaking, precedent-setting, etc. It is also a nice price. I could be wrong but I doubt the family...

Travis Lundy

Soft99 Corp (4464 JP): Effissimo Sheds More Light on Its Hostile Offer

The huge premium of Effissimo’s offer relies on lower WACC assumptions. Management is in a bind, as the huge premium should let Effissimo satisfy...

Arun George

Soft99 Corp (4464 JP): Shock and Awe as Effissimo Emerges with a Competing Offer

Kyodo reports that Effissimo will launch a competing offer at JPY4,100, which will shine an unflattering spotlight on the MBO low-ball offer and...

Arun George

Last Week In Event SPACE: ZEEKR/Geely, Kangji Medical, HKBN, Lynas, Huaxin Cement, Nidec

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

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