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>Today, the <a href="https://www.nikkei.com/article/DGXZQOUC291X90Z21C25A0000000/" target="_blank" rel="noopener">Nikkei reported</a> that <a href="https://www.smartkarma.com/entities/sumitomo-corp" target="_blank" data-smartkarma-citation="entities:5380:1" rel="noopener">Sumitomo Corp (8053 JP)</a> plans to privatise <a href="https://www.smartkarma.com/entities/scsk-corp" target="_blank" data-smartkarma-citation="entities:19996:1" rel="noopener">Scsk Corp (9719 JP)</a> through a tender offer. Both shares were placed on a trading halt.</li>
<li>The Nikkei states that the total acquisition cost would be around JPY800 billion, based on an arbitrary assumption that the offer will be around 20% above the undisturbed price.</li>
<li>The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 is attractive compared to peer multiples and would represent an all-time high. </li>
</ul>


Today, the Nikkei reported that Sumitomo Corp (8053 JP) plans to privatise Scsk Corp (9719 JP) through a tender offer. Both shares were placed on a trading halt.
The Nikkei states that the total acquisition cost would be around JPY800 billion, based on an arbitrary assumption that the offer will be around 20% above the undisturbed price.
The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 is attractive compared to peer multiples and would represent an all-time high. 


SCSK Corp (9719 JP): Sumitomo (8053 JP)’s Rumoured Privatisation Offer

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ntt-data-corp" target="_blank" data-smartkarma-citation="entities:11232:1" rel="noopener">NTT Data Corp (9613 JP)</a> has recommended a tender offer from <a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (Nippon Telegraph &amp; Telephone) (9432 JP)</a> at JPY4,000 per share, a 33.7% premium to the last close.</li>
<li>The Nikkei earlier reported on the offer. The offer represents an all-time high and is attractive compared to historical trading ranges, peer multiples and precedent transactions. </li>
<li>The offer could be considered light as it is below the midpoint of the target IFA’s DCF valuation range. However, the shareholder structure suggests a done deal.  </li>
</ul>



NTT Data Corp (9613 JP) has recommended a tender offer from NTT (Nippon Telegraph &amp; Telephone) (9432 JP) at JPY4,000 per share, a 33.7% premium to the last close.
The Nikkei earlier reported on the offer. The offer represents an all-time high and is attractive compared to historical trading ranges, peer multiples and precedent transactions. 
The offer could be considered light as it is below the midpoint of the target IFA’s DCF valuation range. However, the shareholder structure suggests a done deal.  


NTT DATA (9613 JP): NTT (9432 JP) Tender Offer at JPY4,000

<ul>
<li>
<a href="https://www.smartkarma.com/entities/kkr-co-inc" target="_blank" data-smartkarma-citation="entities:27333:1" rel="noopener">KKR &amp; Co (KKR US)</a> has increased its <a href="https://www.smartkarma.com/entities/fuji-soft-inc" target="_blank" data-smartkarma-citation="entities:17504:1" rel="noopener">Fuji Soft Inc (9749 JP)</a> offer to JPY9,850, a 4.2% premium to the previous JPY9,451 offer and a 2.6% premium to Bain’s JPY9,600 offer.</li>
<li>A bump from KKR was expected and necessary, as the shares have consistently traded above its previous offer. Bain is scheduled to launch its competing offer this week. </li>
<li>Expect a final round of bids, as KKR's offer is not final. The shares closed above KKR's offer, which remains below the high end of the IFA DCF valuation range. </li>
</ul>



KKR &amp; Co (KKR US) has increased its Fuji Soft Inc (9749 JP) offer to JPY9,850, a 4.2% premium to the previous JPY9,451 offer and a 2.6% premium to Bain’s JPY9,600 offer.
A bump from KKR was expected and necessary, as the shares have consistently traded above its previous offer. Bain is scheduled to launch its competing offer this week. 
Expect a final round of bids, as KKR's offer is not final. The shares closed above KKR's offer, which remains below the high end of the IFA DCF valuation range. 


Fuji Soft (9749 JP): Nearing the Endgame as KKR Bumps to JPY9,850

<ul>
<li><span>KKR has <a href="https://media.kkr.com/news-details?news_id=149f73ae-32ba-49df-869e-7eaa102b72a0" target="_blank" rel="noopener">extended</a> the close date of the <a href="https://www.smartkarma.com/entities/fuji-soft-inc" target="_blank" data-smartkarma-citation="entities:17504:1" rel="noopener">Fuji Soft Inc (9749 JP)</a> second tender offer period from 9 to 24 January. All other terms remain unchanged. </span></li>
<li>KKR unconvincingly tries to criticize the Bain offer and unsurprisingly believes there will not be a tender offer by Bain that investors can tender into. </li>
<li>Despite KKR’s gamesmanship, it has not declared its offer final. A bump remains necessary as Bain remains resolute in launching its offer. The final winning offer could be around JPY10,000. </li>
</ul>


KKR has extended the close date of the Fuji Soft Inc (9749 JP) second tender offer period from 9 to 24 January. All other terms remain unchanged. 
KKR unconvincingly tries to criticize the Bain offer and unsurprisingly believes there will not be a tender offer by Bain that investors can tender into. 
Despite KKR’s gamesmanship, it has not declared its offer final. A bump remains necessary as Bain remains resolute in launching its offer. The final winning offer could be around JPY10,000. 


Fuji Soft (9749 JP): KKR Extends Again, Delaying the Inevitable Bump

<ul>
<li>The battle for <a href="https://www.smartkarma.com/entities/fuji-soft-inc" target="_blank" rel="noopener">Fuji Soft Inc. (9749 JP)</a> took an unexpected turn. Bain <a href="https://www.baincapital.co.jp/sites/default/files/2024-12/BCP_9749_11122024-jp1.pdf" target="_blank" rel="noopener">revised its offer</a> to JPY9,600, a 1.6% premium to KKR’s JPY9,451 second tender offer. </li>
<li>Bain has introduced a minimum number of shares to be purchased criterion. Bain’s offer is structured to address most but not all of the special committee’s reasons for opposition.</li>
<li>The Board’s first reaction will be to ask KKR, its preferred bidder, to bump. Given the amount of time and effort KKR has put into this bid, it will bump. </li>
</ul>


The battle for Fuji Soft Inc. (9749 JP) took an unexpected turn. Bain revised its offer to JPY9,600, a 1.6% premium to KKR’s JPY9,451 second tender offer. 
Bain has introduced a minimum number of shares to be purchased criterion. Bain’s offer is structured to address most but not all of the special committee’s reasons for opposition.
The Board’s first reaction will be to ask KKR, its preferred bidder, to bump. Given the amount of time and effort KKR has put into this bid, it will bump. 


Fuji Soft (9749 JP): Bain Can’t Take No for an Answer and Returns with a JPY9,600 Offer

Japan

NS Solutions Corporation operates system consulting services and proposal of solutions.  The Company also manages operation and maintenance of engineering systems and develops software.

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NS Solutions (2327 JP)

SCSK Corp (9719 JP): Sumitomo (8053 JP)’s Rumoured Privatisation Offer

The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 (JPY800 billion acquisition cost) is attractive compared to...

Arun George

NTT DATA (9613 JP): NTT (9432 JP) Tender Offer at JPY4,000

While below the midpoint of the target IFA’s DCF valuation, the offer represents an all-time high and is attractive compared to historical trading...

Arun George

Fuji Soft (9749 JP): Nearing the Endgame as KKR Bumps to JPY9,850

The bump was required. Expect a final round of bids, as KKR's offer is not final. The shares closed above KKR's offer, which remains below the high...

Arun George

Fuji Soft (9749 JP): KKR Extends Again, Delaying the Inevitable Bump

Despite KKR’s gamesmanship, it has not declared its offer final. A bump remains necessary as Bain remains resolute in launching its offer. The...

Arun George

Fuji Soft (9749 JP): Bain Can’t Take No for an Answer and Returns with a JPY9,600 Offer

Despite repeated stonewalling, Bain returns with a revised offer. The Board’s first reaction will be to ask KKR, its preferred bidder, to bump. KKR...

Arun George

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