IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

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>On 23 October, the MBO price for <a href="https://www.smartkarma.com/entities/pacific-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:6261:1" rel="noopener">Pacific Industrial (7250 JP)</a> was increased by 42.4% to JPY2,919 per share. The offer closes on 7 November. </li>
<li>Today, Effissimo further increased its stake to 8.6 million shares, representing 13.97% of outstanding shares and a 14.82% ownership ratio. The implication is that Effissimo remains unsupportive.  </li>
<li>The shares trade above terms, and the close is likely to be extended. Another bump is possible, but likely, the Ogawas will first try to lower the minimum acceptance condition. </li>
</ul>


On 23 October, the MBO price for Pacific Industrial (7250 JP) was increased by 42.4% to JPY2,919 per share. The offer closes on 7 November. 
Today, Effissimo further increased its stake to 8.6 million shares, representing 13.97% of outstanding shares and a 14.82% ownership ratio. The implication is that Effissimo remains unsupportive.  
The shares trade above terms, and the close is likely to be extended. Another bump is possible, but likely, the Ogawas will first try to lower the minimum acceptance condition. 


Pacific Industrial (7250 JP): A Day Before Close, Effissimo Increases Its Stake Further

<ul>
<li>Effissimo has steadily increased its <a href="https://www.smartkarma.com/entities/pacific-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:6261:1" rel="noopener">Pacific Industrial (7250 JP)</a> stake to 7.0 million shares or a 12.17% ownership ratio. The most recent purchases were at an average price of JPY2,616.08. </li>
<li>Effissimo is taking contrasting approaches to low-ball MBOs. 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>, Effissimo has launched a hostile offer, while for Pacific, Effissimo has chosen to agitate for better terms.</li>
<li>The offer closes on 24 September. While a bump is the most likely scenario, the share price is 30% higher than the offer price, suggesting limited upside. Take profits. </li>
</ul>


Effissimo has steadily increased its Pacific Industrial (7250 JP) stake to 7.0 million shares or a 12.17% ownership ratio. The most recent purchases were at an average price of JPY2,616.08. 
Effissimo is taking contrasting approaches to low-ball MBOs. For Soft99 Corp (4464 JP), Effissimo has launched a hostile offer, while for Pacific, Effissimo has chosen to agitate for better terms.
The offer closes on 24 September. While a bump is the most likely scenario, the share price is 30% higher than the offer price, suggesting limited upside. Take profits. 


Pacific Industrial (7250 JP): Limited Upside as Effissimo Continues to Add

<ul>
<li>Effissimo reported a 5.87% ownership ratio in <a href="https://www.smartkarma.com/entities/pacific-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:6261:1" rel="noopener">Pacific Industrial (7250 JP)</a>. The average buy-in price of JPY2,235.91 per share is 9.1% above the JPY2,050 MBO offer.</li>
<li>Effissimo buying significantly above terms is justifiable as the offer implied a P/B of 0.71x. Effissimo is agitating for either a bump or an opportunity to participate in the back-end.</li>
<li>With the offer closing on 8 September and shares trading 16.9% above terms, the Ogawas have little choice but to revise terms.</li>
</ul>


Effissimo reported a 5.87% ownership ratio in Pacific Industrial (7250 JP). The average buy-in price of JPY2,235.91 per share is 9.1% above the JPY2,050 MBO offer.
Effissimo buying significantly above terms is justifiable as the offer implied a P/B of 0.71x. Effissimo is agitating for either a bump or an opportunity to participate in the back-end.
With the offer closing on 8 September and shares trading 16.9% above terms, the Ogawas have little choice but to revise terms.


Pacific Industrial (7250 JP): Effissimo Rears Its Head

<ul>
<li>Takateru Murakami, Yoshiaki Murakami’s son, reported a 10.88% ownership ratio in <a href="https://www.smartkarma.com/entities/ashimori-industry-co-ltd" target="_blank" data-smartkarma-citation="entities:13918:1" rel="noopener">Ashimori Industry (3526 JP)</a>. The purchases were from 14 to 18 August, i.e., after the tender offer announcement.</li>
<li>Takateru Murakami’s average buy-in price of JPY4,134.79 per share is broadly in line with the <a href="https://www.smartkarma.com/entities/toyoda-gosei-co-ltd" target="_blank" data-smartkarma-citation="entities:20125:1" rel="noopener">Toyoda Gosei (7282 JP)</a>'s JPY4,140 tender offer. </li>
<li>Murakami's disclosure suggests three possibilities: 1) force Toyoda Gosei to bump, 2) reach an agreement to rollover its shares into the BidCo or 3) a combination of 1 and 2.</li>
</ul>


Takateru Murakami, Yoshiaki Murakami’s son, reported a 10.88% ownership ratio in Ashimori Industry (3526 JP). The purchases were from 14 to 18 August, i.e., after the tender offer announcement.
Takateru Murakami’s average buy-in price of JPY4,134.79 per share is broadly in line with the Toyoda Gosei (7282 JP)'s JPY4,140 tender offer. 
Murakami's disclosure suggests three possibilities: 1) force Toyoda Gosei to bump, 2) reach an agreement to rollover its shares into the BidCo or 3) a combination of 1 and 2.


Ashimori Industry (3526 JP): Potential Endgames as Murakami Builds a Stake

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>On Friday 17 January, the closing date of the CVC Tender Offer for <a href="https://www.smartkarma.com/entities/macromill-inc" target="_blank" data-smartkarma-citation="entities:24026:1" rel="noopener">Macromill, Inc (3978 JP)</a> at ¥1,150/share, the bidder announced an extension of the Tender Offer.</li>
<li>They also announced a bump to ¥1,250/share, and that included a comment saying they resolved not to raise the price further. </li>
<li>This happened during market hours, and the price jumped to just below ¥1,250/share. But one should not consider this a done deal. For reasons...</li>
</ul>


On Friday 17 January, the closing date of the CVC Tender Offer for Macromill, Inc (3978 JP) at ¥1,150/share, the bidder announced an extension of the Tender Offer.
They also announced a bump to ¥1,250/share, and that included a comment saying they resolved not to raise the price further. 
This happened during market hours, and the price jumped to just below ¥1,250/share. But one should not consider this a done deal. For reasons...


CVC Bumps the Macromill (3978) Price, Declares Final, and That's That... Or Is It?

Japan

NICHII GAKKAN COMPANY provides hospital administration services for medical facilities.  The Company also offers home nursing services and home helper training courses.

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Nichii Gakkan Co (9792 JP)

Pacific Industrial (7250 JP): A Day Before Close, Effissimo Increases Its Stake Further

The close is likely to be extended as Effissimo added to its stake, and the shares trade above terms. Another bump is possible, but the Ogawas will...

Arun George

Pacific Industrial (7250 JP): Limited Upside as Effissimo Continues to Add

Effissimo is now at a 12.17% ownership ratio. While a bump is the most likely scenario, the share price is 30% higher than the offer price,...

Arun George

Pacific Industrial (7250 JP): Effissimo Rears Its Head

With the offer closing on 8 September and shares trading materially above terms, the Ogawas have little choice but to revise terms.

Arun George

Ashimori Industry (3526 JP): Potential Endgames as Murakami Builds a Stake

Takateru Murakami has reported a 10.88% ownership ratio that will be a problem for Toyoda Gosei's tender offer. There are three possible ways this...

Arun George

CVC Bumps the Macromill (3978) Price, Declares Final, and That's That... Or Is It?

CVC has upped its bid for Macromill, now 50+% owned by 5-7 investors. It is not a big bump. I tend to think it is not enough. The deal may break...

Travis Lundy

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