Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Shin Kong Financial Holding / Event-Driven

<ul>
<li>Late Monday, The Financial Supervisory Commission approved the merger where <a href="https://www.smartkarma.com/entities/shin-kong-financial-holding" target="_blank" data-smartkarma-citation="entities:15351:1" rel="noopener">Shin Kong Financial Holding (2888 TT)</a> is to be absorbed by <a href="https://www.smartkarma.com/entities/taishin-financial-holding" target="_blank" data-smartkarma-citation="entities:715:1" rel="noopener">Taishin Financial Holding (2887 TT)</a>. Announcement <a href="https://www.fsc.gov.tw/ch/home.jsp?id=96&amp;parentpath=0,2&amp;mcustomize=news_view.jsp&amp;dataserno=202503310004&amp;aplistdn=ou=news,ou=multisite,ou=chinese,ou=ap_root,o=fsc,c=tw&amp;dtable=News" target="_blank" rel="noopener">here</a>.</li>
<li>Yesterday, the chairmen of both Shin Kong and Taishin decided the merger base date, which has been set a bit further out than even I expected, at 24 July 2025.</li>
<li>The terms tightened yesterday. There is still a worthwhile switch to be done (or arb if you have cheap borrow), and NEWCO is cheap to peers, STILL.</li>
</ul>


Late Monday, The Financial Supervisory Commission approved the merger where Shin Kong Financial Holding (2888 TT) is to be absorbed by Taishin Financial Holding (2887 TT). Announcement here.
Yesterday, the chairmen of both Shin Kong and Taishin decided the merger base date, which has been set a bit further out than even I expected, at 24 July 2025.
The terms tightened yesterday. There is still a worthwhile switch to be done (or arb if you have cheap borrow), and NEWCO is cheap to peers, STILL.


Shin Kong (2888 TT)/Taishin (2887 TT) Deal Gets FSC Approval - Still A Good Swap

<ul>
<li>After rumours were rekindled a week earlier, on 22 August 2024, <a href="https://www.smartkarma.com/entities/taishin-financial-holding" target="_blank" data-smartkarma-citation="entities:715:1" rel="noopener">Taishin Financial Holding (2887 TT)</a> and <a href="https://www.smartkarma.com/entities/shin-kong-financial-holding" target="_blank" data-smartkarma-citation="entities:15351:1" rel="noopener">Shin Kong Financial Holding (2888 TT)</a> announced they would merge.</li>
<li>The ratio is 0.6022 shares of Taishin for every share of Shin Kong putting NEWCO assets at about the level of Taiwan #3 CTBC Financial. That's bad.</li>
<li>There's history here. LOTS of history. This would need approvals from the FSC and FTC, but CTBC is already a spoiner, and the SKFH Board Meeting was anything but clean.</li>
</ul>


After rumours were rekindled a week earlier, on 22 August 2024, Taishin Financial Holding (2887 TT) and Shin Kong Financial Holding (2888 TT) announced they would merge.
The ratio is 0.6022 shares of Taishin for every share of Shin Kong putting NEWCO assets at about the level of Taiwan #3 CTBC Financial. That's bad.
There's history here. LOTS of history. This would need approvals from the FSC and FTC, but CTBC is already a spoiner, and the SKFH Board Meeting was anything but clean.


Shin Kong (2888.TW) And Taishin (2887.TW) Agree to Merge, But It Isn't Clean, And It's A Bad Price

<ul>
<li>The TFTC approved in early January, The TFTC <a href="https://www.cna.com.tw/news/afe/202501080360.aspx" target="_blank" rel="noopener">said</a> market power would be limited and competition unrestricted. Another <a href="https://www.cna.com.tw/news/afe/202501070351.aspx" target="_blank" rel="noopener">CNA article</a> suggested the two FHCs were completing employee placement plans.</li>
<li>Apparently, as of a month ago, only the Shin Kong Bank employee settlement plan had not been completed but the FSC has rules about that. Consideration likely proceeds.</li>
<li>There are specific rules about how these things are dealt with. In the meantime, the spread - still wide - is narrowing.</li>
</ul>


The TFTC approved in early January, The TFTC said market power would be limited and competition unrestricted. Another CNA article suggested the two FHCs were completing employee placement plans.
Apparently, as of a month ago, only the Shin Kong Bank employee settlement plan had not been completed but the FSC has rules about that. Consideration likely proceeds.
There are specific rules about how these things are dealt with. In the meantime, the spread - still wide - is narrowing.


Shin Kong (2888 TT) / Taishin (2887 TT) - Waiting on the FSC

Founder of Antler Capital

Stanley Tsai, CFA

Thematic (Sector/Industry)

<ul>
<li>The unfolding crisis is unlikely to have far-reaching impacts on Asia financial names, given their more robust deposit franchises and sector diversification.</li>
<li>That said, the Taiwanese financial holdcos do seem to be substantially more exposed than their peers in other markets owing to the USD fixed-income exposures at their life insurance units.</li>
<li>In a flight-to-quality scenario, we expect Fubon FHC to outperform the more geared Shin Kong FHC.</li>
</ul>


The unfolding crisis is unlikely to have far-reaching impacts on Asia financial names, given their more robust deposit franchises and sector diversification.
That said, the Taiwanese financial holdcos do seem to be substantially more exposed than their peers in other markets owing to the USD fixed-income exposures at their life insurance units.
In a flight-to-quality scenario, we expect Fubon FHC to outperform the more geared Shin Kong FHC.


Asia Financials: The Fallout from SVB and Silvergate | Where's the Biggest Asset/Liability Mismatch?

David Blennerhassett

<ul>
<li>I tally 40 - mostly firm, mostly Asia-Pac - arb transactions currently being discussed and analysed on Smartkarma.</li>
<li>Two new deals were discussed on Smartkarma this week: <a href="https://www.smartkarma.com/entities/dd-group-co-ltd" target="_blank" data-smartkarma-citation="entities:1439:1" rel="noopener">DD Group (3073 JP)</a>'s MBO and the <a href="https://www.smartkarma.com/entities/hanil-cement-co-ltd-new" target="_blank" data-smartkarma-citation="entities:27447:1" rel="noopener">Hanil Cement Co Ltd/New (300720 KS)</a>/<a href="https://www.smartkarma.com/entities/hanil-hyundai-cement-co-ltd" target="_blank" data-smartkarma-citation="entities:14406:1" rel="noopener">Hanil Hyundai Cement (006390 KS)</a> merger.</li>
<li>Key updates/news took place on <a href="https://www.smartkarma.com/entities/pointsbet-holdings-ltd" target="_blank" data-smartkarma-citation="entities:29102:1" rel="noopener">PointsBet Holdings (PBH AU)</a>, <a href="https://www.smartkarma.com/entities/adriatic-metals-plc" target="_blank" data-smartkarma-citation="entities:30797:1" rel="noopener">Adriatic Metals PLC (ADT AU)</a>, <a href="https://www.smartkarma.com/entities/abacus-storage-king" target="_blank" data-smartkarma-citation="entities:39857:1" rel="noopener">Abacus Storage King (ASK AU)</a>, <a href="https://www.smartkarma.com/entities/new-world-resources-ltd" target="_blank" data-smartkarma-citation="entities:9712:1" rel="noopener">New World Resources (NWC AU)</a>, and <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>.</li>
</ul>


I tally 40 - mostly firm, mostly Asia-Pac - arb transactions currently being discussed and analysed on Smartkarma.
Two new deals were discussed on Smartkarma this week: DD Group (3073 JP)'s MBO and the Hanil Cement Co Ltd/New (300720 KS)/Hanil Hyundai Cement (006390 KS) merger.
Key updates/news took place on PointsBet Holdings (PBH AU), Adriatic Metals PLC (ADT AU), Abacus Storage King (ASK AU), New World Resources (NWC AU), and ZEEKR (ZK US).


(Mostly) Asia-Pac M&A: ZEEKR, DD Group, Hanil Cement, Adriatic Metals, Abacus Storage, PointsBet

Taiwan

Shin Kong Financial Holding Co., Ltd. is a holding company.  Through its subsidiaries, the Company provides traditional life, health, group and accident insurance products and services, as well as acts as a broker, dealer and underwriter for financial securities.

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Shin Kong Financial Holding (2888 TT)

Shin Kong (2888 TT)/Taishin (2887 TT) Deal Gets FSC Approval - Still A Good Swap

The Shin Kong/Taishin Deal has been approved. The merger base date has been set for late July. There is still a good gross spread to take and NEWCO...

Travis Lundy

Shin Kong (2888.TW) And Taishin (2887.TW) Agree to Merge, But It Isn't Clean, And It's A Bad Price

Shin Kong Financial and Taishin Financial have agreed to merge, but the Board decision and price aren't pretty. Looks a bit like a coup. And CTBC...

Travis Lundy

Shin Kong (2888 TT) / Taishin (2887 TT) - Waiting on the FSC

The FSC is considering the merger case for Shin Kong and Taishin according to local press reports. The timing of the articles suggest approval...

Travis Lundy

Asia Financials: The Fallout from SVB and Silvergate | Where's the Biggest Asset/Liability Mismatch?

For the most part, we expect Asia financial names to be able to withstand the SVB / Silvergate fallout. But risks in ALM are reminiscent of what...

Stanley Tsai, CFA

(Mostly) Asia-Pac M&A: ZEEKR, DD Group, Hanil Cement, Adriatic Metals, Abacus Storage, PointsBet

This insight provides a summary of gross/annualised spreads (on deals discussed on Smartkarma) across Asia-Pacific as at the last trading date, and...

David Blennerhassett

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