Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Event-Driven

<a href="https://www.smartkarma.com/profiles/david-blennerhassett" target="_blank" data-smartkarma-citation="accounts:840" rel="noopener">David Blennerhassett</a> has covered the pertinent details of Saracen Mineral Holdings’ and Northern Star Resources’ merger-of-(almost)equals <a href="https://www.smartkarma.com/insights/northern-star-saracen-merger-of-equals" target="_blank" rel="noopener">here</a>. We had been advocating a positive stance on Saracen prior to that and still like the name. In fact, we like the combined entity even more and discuss some of the fundamental considerations below.

David Blennerhassett has covered the pertinent details of Saracen Mineral Holdings’ and Northern Star Resources’ merger-of-(almost)equals here. We had been advocating a positive stance on Saracen prior to that and still like the name. In fact, we like the combined entity even more and discuss some of the fundamental considerations below.

Saracen – Trade the Northern Star Deal and Then Stay Long Northern Star

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<a href="https://www.smartkarma.com/entities/northern-star-resources-ltd" target="_blank" data-smartkarma-citation="entities:4243:1" rel="noopener">Northern Star Resources (NST AU)</a> and <a href="https://www.smartkarma.com/entities/saracen-mineral-holdings-limited" target="_blank" data-smartkarma-citation="entities:2415:1" rel="noopener">Saracen Mineral Holdings (SAR AU)</a> have <a href="https://www.asx.com.au/asxpdf/20201006/pdf/44ncx7hy38vkm3.pdf" target="_blank" rel="noopener">agree</a>d to a merger-of-equals via a Scheme of Arrangement under which NST will acquire 100% of SAR.
SAR shareholders will receive 0.3763 new NST shares for each SAR share. SAR will also pay a fully franked dividend of A$0.038/share, conditional on the Scheme becoming effective.
Subsequent to a successful Scheme, NST shareholders will hold 64% of the combined entity (with roughly a A$16bn market cap), and SAR shareholders 36%. 
Pre-tax synergies are estimated to be worth A$1.5bn-A$2bn over the next 10 years. 
Standard Scheme conditions apply: SAR shareholders approving the Scheme (75%); independent expert concluding the Scheme is in the best interest of SAR shareholders; and no MACs, for either NST and SAR.
The tentative implementation date is February 2021.
As always, more below the fold.

Northern Star Resources (NST AU) and Saracen Mineral Holdings (SAR AU) have agreed to a merger-of-equals via a Scheme of Arrangement under which NST will acquire 100% of SAR.
SAR shareholders will receive 0.3763 new NST shares for each SAR share. SAR will also pay a fully franked dividend of A$0.038/share, conditional on the Scheme becoming effective.
Subsequent to a successful Scheme, NST shareholders will hold 64% of the combined entity (with roughly a A$16bn market cap), and SAR shareholders 36%. 
Pre-tax synergies are estimated to be worth A$1.5bn-A$2bn over the next 10 years. 
Standard Scheme conditions apply: SAR shareholders approving the Scheme (75%); independent expert concluding the Scheme is in the best interest of SAR shareholders; and no MACs, for either NST and SAR.
The tentative implementation date is February 2021.
As always, more below the fold. 

Equity Bottom-Up

Saracen Mineral Holdings / Equity Bottom-Up

In February we highlighted Australian gold miners as being in an interesting position due to rising gold prices and flagged Saracen as being particularly interesting due to its prospects for volume growth. The timing of that call collided with the outbreak of COVID but even so, Saracen is up 39% since we made our call thanks to continued strength in gold prices as central banks flood markets with liquidity. We believe the theme retains significant merit and below we examine updated valuations for both Saracen and our preferred hedge, Newcrest.

In February we highlighted Australian gold miners as being in an interesting position due to rising gold prices and flagged Saracen as being particularly interesting due to its prospects for volume growth. The timing of that call collided with the outbreak of COVID but even so, Saracen is up 39% since we made our call thanks to continued strength in gold prices as central banks flood markets with liquidity. We believe the theme retains significant merit and below we examine updated valuations for both Saracen and our preferred hedge, Newcrest.

Saracen Mineral Holdings – Valuation Update for This Gold Play

With the gold price breaking out higher cost miners such as Saracen Mineral Holdings look attractive. In particular, the strong volume growth promised by its acquisition of the KCGM Super Pit and expansion of capacity at Carosue make the name intriguing.

With the gold price breaking out higher cost miners such as Saracen Mineral Holdings look attractive. In particular, the strong volume growth promised by its acquisition of the KCGM Super Pit and expansion of capacity at Carosue make the name intriguing.

Saracen Mineral Holdings – Doubling Production Into a Surging Gold Price Is Not a Bad Combination

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Northern Star Resources / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/4243" target="_blank" data-smartkarma-citation="entities:4243:1" rel="noopener">Northern Star Resources (NST AU)</a> plans to raise up to US$526m (A$765m) to part fund its purchase of 50% interest in Kalgoorlie Gold Mines for US$800m from <a href="https://www.smartkarma.com/entities/newmont-mining-corp" target="_blank" data-smartkarma-citation="entities:14503:1" rel="noopener">Newmont Mining (NEM US)</a>. The transaction is expected to be accretive to earnings despite the large dilution. While NST's share price performance over the past few months hasn't been great, its longer term track record remains stellar.

Northern Star Resources (NST AU) plans to raise up to US$526m (A$765m) to part fund its purchase of 50% interest in Kalgoorlie Gold Mines for US$800m from Newmont Mining (NEM US). The transaction is expected to be accretive to earnings despite the large dilution. While NST's share price performance over the past few months hasn't been great, its longer term track record remains stellar. 

Northern Star Resources Placement - Earnings Accretive, Good Track Record

Australia

Saracen Mineral Holdings Ltd. explores for and produces gold.  The Company produces gold from its Carosue Dam mine located notheast of Kalgoorlie, Western Australia.

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Saracen Mineral Holdings (SAR AU)

Saracen – Trade the Northern Star Deal and Then Stay Long Northern Star

David Blennerhassett has covered the pertinent details of Saracen Mineral Holdings’ and Northern Star Resources’ merger-of-(almost)equals here. We...

Mio Kato

Northern Star/Saracen: Merger Of Equals

Northern Star Resources (NST AU) and $sara

David Blennerhassett

Saracen Mineral Holdings – Valuation Update for This Gold Play

In February we highlighted Australian gold miners as being in an interesting position due to rising gold prices and flagged Saracen as being...

Mio Kato

Saracen Mineral Holdings – Doubling Production Into a Surging Gold Price Is Not a Bad Combination

With the gold price breaking out higher cost miners such as Saracen Mineral Holdings look attractive. In particular, the strong volume growth...

Mio Kato

Northern Star Resources Placement - Earnings Accretive, Good Track Record

Northern Star Resources (NST AU) plans to raise up to US$526m (A$765m) to part fund its purchase of 50% interest in Kalgoorlie Gold Mines for...

Sumeet Singh

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