Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<p>Some 14 months after <a href="http://chinabiologic.investorroom.com/2019-09-18-China-Biologic-Announces-Receipt-of-Preliminary-Non-Binding-Going-Private-Proposal" target="_blank" rel="noopener">announcing</a> the receipt of a preliminary non-binding proposal from Beachhead Holdings, CITIC, <a href="https://www.smartkarma.com/entities/pw-medtech-group-ltd" target="_blank" data-smartkarma-citation="entities:9891:1" rel="noopener">Pw Medtech (1358 HK)</a>,<span id="spanHghlt74d7"> Parfield </span>International, Hillhouse, and V-Sciences Investments for US$120/share, in cash, <a href="https://www.smartkarma.com/entities/china-biologic-products-hold" target="_blank" data-smartkarma-citation="entities:22633:1" rel="noopener">China Biologic Products (CBPO US)</a> entered into a <a href="http://app.quotemedia.com/data/downloadFiling?webmasterId=101533&amp;ref=115451875&amp;type=PDF&amp;symbol=CBPO&amp;companyName=China+Biologic+Products+Holdings+Inc.&amp;formType=6-K&amp;dateFiled=2020-11-19&amp;CK=1369868" target="_blank" rel="noopener">definitive merger agreement</a>, also at US$120/share, on the 19 November last year.</p>
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<p>The merger was conditional on an affirmative vote from shareholders representing at least two-thirds of the shares out, and that the aggregate quantity of dissenting shares being less than 8% of shares out.</p>
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<p>Yesterday shareholders <a href="https://www.sec.gov/Archives/edgar/data/1369868/000110465921029688/tm218258d1_ex99-1.htm" target="_blank" rel="noopener">approved</a> the merger at an EGM. 84.5% of CBPO's outstanding shares attended in person or via proxy at the EGM, and ~92.2% voted in favour of the proposal to authorize and approve the Merger Agreement. This was no surprise - the Buyer Consortium (including PW Medtech) and the Rollover Management Members, beneficially owned ~68.84% of shares out.  </p>
<p>However, CBPO also announced that it "<em>had received notices of objection from certain shareholders that in the aggregate hold more than 8% of the total outstanding shares of the Company</em>".</p>
<p>This deal now looks set to mirror the timeline currently underway for <a href="https://www.smartkarma.com/entities/sina-corp-china" target="_blank" data-smartkarma-citation="entities:22691:1" rel="noopener">Sina Corp (Class A) (SINA US)</a>.</p>
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<p>More below the fold.</p>
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Some 14 months after announcing the receipt of a preliminary non-binding proposal from Beachhead Holdings, CITIC, Pw Medtech (1358 HK), Parfield International, Hillhouse, and V-Sciences Investments for US$120/share, in cash, China Biologic Products (CBPO US) entered into a definitive merger agreement, also at US$120/share, on the 19 November last year.

The merger was conditional on an affirmative vote from shareholders representing at least two-thirds of the shares out, and that the aggregate quantity of dissenting shares being less than 8% of shares out.


Yesterday shareholders approved the merger at an EGM. 84.5% of CBPO's outstanding shares attended in person or via proxy at the EGM, and ~92.2% voted in favour of the proposal to authorize and approve the Merger Agreement. This was no surprise - the Buyer Consortium (including PW Medtech) and the Rollover Management Members, beneficially owned ~68.84% of shares out.  
However, CBPO also announced that it "had received notices of objection from certain shareholders that in the aggregate hold more than 8% of the total outstanding shares of the Company".
This deal now looks set to mirror the timeline currently underway for Sina Corp (Class A) (SINA US).


More below the fold.






<p>Back on the 6 July last year, <a href="https://www.smartkarma.com/entities/sina-corp-china" target="_blank" data-smartkarma-citation="entities:22691:1" rel="noopener">Sina Corp (Class A) (SINA US)</a> <a href="http://ir.sina.com/index.php/static-files/69e95aee-2729-457f-be56-73628090b8ea" target="_blank" rel="noopener">announced</a> the receipt of a preliminary non-binding “going private” proposal from New Wave MMXV - a company controlled by its chairman/CEO Charles Chao - at US$41/share. This was followed by an <a href="http://ir.sina.com/static-files/de1ddd0f-354f-42de-9b33-b1bc414ab1b4" target="_blank" rel="noopener">Agreement and Plan of Merger</a> pursuant to which New Wave will acquire all of the outstanding ordinary shares not owned at US$43.30/share.</p>
<p>Despite an undemanding Offer price, shareholders approved (93.6% of the total votes) the merger on the <a href="http://ir.sina.com/static-files/ea4a5614-30e8-472c-895c-31e120de3261" target="_blank" rel="noopener">23 December</a>.</p>
<p>Completion of the merger was contingent on the satisfaction or waiver of the closing conditions set forth in the Merger Agreement, including no more than 10% of the ordinary shares dissenting.</p>
<p>Prior to the  EGM, <a href="http://ir.sina.com/static-files/722deb54-0426-4b43-a58a-1c8be8b59b61" target="_blank" rel="noopener">21.5mn shares or 35.9%</a> of the total issued and outstanding shares of Sina issued notices of objections to the company. </p>
<p>On or prior to January 12, 2021, Sina intended to issue written notices of authorization to all the objecting shareholders. Within 20 days immediately <em>after</em> the date on which these notices were given, any objecting shareholder was required to give written notice of its decision to dissent.</p>
<p>There has been no update on the merger from Sina since the 28 December. Behind the scenes, Charles Chao can choose to walk, negotiate a superior price with dissentient shareholders, or waive the condition.  Should he waive the condition, dissentient shareholders have the right to be paid fair value for their shares, as determined by the Cayman Island's Grand Court.</p>
<p>More below the fold.<a href="https://www.collascrill.com/news-updates/articles/grand-court-confirms-that-dissent-rights-are-available-to-minority-shareholders-in-short-form-mergers/" target="_blank" rel="noopener"></a></p>

Back on the 6 July last year, Sina Corp (Class A) (SINA US) announced the receipt of a preliminary non-binding “going private” proposal from New Wave MMXV - a company controlled by its chairman/CEO Charles Chao - at US$41/share. This was followed by an Agreement and Plan of Merger pursuant to which New Wave will acquire all of the outstanding ordinary shares not owned at US$43.30/share.
Despite an undemanding Offer price, shareholders approved (93.6% of the total votes) the merger on the 23 December.
Completion of the merger was contingent on the satisfaction or waiver of the closing conditions set forth in the Merger Agreement, including no more than 10% of the ordinary shares dissenting.
Prior to the  EGM, 21.5mn shares or 35.9% of the total issued and outstanding shares of Sina issued notices of objections to the company. 
On or prior to January 12, 2021, Sina intended to issue written notices of authorization to all the objecting shareholders. Within 20 days immediately after the date on which these notices were given, any objecting shareholder was required to give written notice of its decision to dissent.
There has been no update on the merger from Sina since the 28 December. Behind the scenes, Charles Chao can choose to walk, negotiate a superior price with dissentient shareholders, or waive the condition.  Should he waive the condition, dissentient shareholders have the right to be paid fair value for their shares, as determined by the Cayman Island's Grand Court.
More below the fold.

<p>On the 24 January last year, <a href="https://www.smartkarma.com/entities/changyou-com-ltd-ads" target="_blank" data-smartkarma-citation="entities:19287:1" rel="noopener">Changyou.com (CYOU US)</a> <a href="http://ir.changyou.com/file/New-Comet-20200124.pdf" target="_blank" rel="noopener">entered</a> into a definitive agreement with <a href="https://www.smartkarma.com/entities/sohu-com-ltd" target="_blank" data-smartkarma-citation="entities:22853:1" rel="noopener">Sohu.com Inc (SOHU US)</a> at US$5.40/share, or US$10.80/ADS in cash. On the 14 April,  Sohu <a href="http://investors.sohu.com/static-files/4f6c805d-a81c-4799-a043-3d163d5702e7" target="_blank" rel="noopener">announced</a> the filing of the definitive plan of merger.</p>
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<p>Sohu held 67.4% of shares out in Changyou via its A and B shares and 95.3% of the voting rights given the disproportionate voting power of the B shares. As Sohu held &gt;90% of the votes, the Offer was in the form of a short-form statutory merger under Cayman Law - i.e. approval from Changyou's shareholders was not required. No vote, no dissent. Done deal.</p>
<p><em><strong>But wait ...</strong></em></p>
<p>In a ruling handed down on the 28 January, the Grand Court of the Cayman Islands concluded that shareholders of companies that undertake a 'short-form' merger <em>are</em> entitled to dissent. </p>
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<p>It would be absurd to exclude a dissentient member of a company subject to short-form merger from the protection of section 238 simply because, unlike in the case of a long-form merger, that member is not allowed to vote.</p>
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<p>The ruling has wide-ranging implications.</p>
<p>More below the fold.</p>
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On the 24 January last year, Changyou.com (CYOU US) entered into a definitive agreement with Sohu.com Inc (SOHU US) at US$5.40/share, or US$10.80/ADS in cash. On the 14 April,  Sohu announced the filing of the definitive plan of merger.

Sohu held 67.4% of shares out in Changyou via its A and B shares and 95.3% of the voting rights given the disproportionate voting power of the B shares. As Sohu held &gt;90% of the votes, the Offer was in the form of a short-form statutory merger under Cayman Law - i.e. approval from Changyou's shareholders was not required. No vote, no dissent. Done deal.
But wait ...
In a ruling handed down on the 28 January, the Grand Court of the Cayman Islands concluded that shareholders of companies that undertake a 'short-form' merger are entitled to dissent. 

It would be absurd to exclude a dissentient member of a company subject to short-form merger from the protection of section 238 simply because, unlike in the case of a long-form merger, that member is not allowed to vote.

The ruling has wide-ranging implications.
More below the fold.


Changyou (CYOU US): Short-Form Merger Dissent Now Permitted

Alpha-Centric ESG Research

Kyle Rudden

<p>Sometimes, the "ESG stuff" can really alter the outcome of an IPO. The <a href="https://www.smartkarma.com/entities/saudi-aramco" target="_blank" data-smartkarma-citation="entities:27317:1" rel="noopener">Saudi Aramco (ARAMCO AB)</a> debut was curbed by Environmental concerns. WeWork's failed IPO is a case study in founder-led Governance risk. Palantir quashed its "adjustable voting power for founders" after an uproar.</p>
<p>ESG impacts IPOs. But not Ant's IPO.</p>
<p>Ant's ESG profile is strong. There a few skeletons in the closet if you look hard enough, but they are bygone and irrelevant . Current ESG blemishes are minor. There isn't much dirt for ESG idealists to wallow in. If they are even looking at all; as a "China deal," ESG has a different relevance for Ant.</p>
<p>Ant's IPO is a momentous ESG event, but not in the traditional and obvious way.</p>
<p>This is not about ESG impacting Ant's IPO. This is about Ant's IPO impacting ESG.</p>
<p>Looking at Ant through a typical ESG lens will make one's head spin. But step back and look again, and it becomes clear that Ant is a strategically-integrated masterpiece at the vanguard of a critical crossroads – the intersection of Fintech, financial inclusion, green finance, and sustainability.</p>
<p>It is all a matter of perspective.</p>
<p>Seeing the forest for the trees.</p>

Sometimes, the "ESG stuff" can really alter the outcome of an IPO. The Saudi Aramco (ARAMCO AB) debut was curbed by Environmental concerns. WeWork's failed IPO is a case study in founder-led Governance risk. Palantir quashed its "adjustable voting power for founders" after an uproar.
ESG impacts IPOs. But not Ant's IPO.
Ant's ESG profile is strong. There a few skeletons in the closet if you look hard enough, but they are bygone and irrelevant . Current ESG blemishes are minor. There isn't much dirt for ESG idealists to wallow in. If they are even looking at all; as a "China deal," ESG has a different relevance for Ant.
Ant's IPO is a momentous ESG event, but not in the traditional and obvious way.
This is not about ESG impacting Ant's IPO. This is about Ant's IPO impacting ESG.
Looking at Ant through a typical ESG lens will make one's head spin. But step back and look again, and it becomes clear that Ant is a strategically-integrated masterpiece at the vanguard of a critical crossroads – the intersection of Fintech, financial inclusion, green finance, and sustainability.
It is all a matter of perspective.
Seeing the forest for the trees.

Ant Group Pre-IPO ESG Assessment: Seeing the Forest for the Trees

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<p>Back on the 27 July, Chinese search-engine <a href="https://www.smartkarma.com/entities/sogou-inc" target="_blank" data-smartkarma-citation="entities:25996:1" rel="noopener">Sogou Inc (SOGO US)</a>, majority-owned by <a href="https://www.smartkarma.com/entities/sohu-com-ltd" target="_blank" data-smartkarma-citation="entities:22853:1" rel="noopener">Sohu.com Inc (SOHU US)</a>  and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>, <a href="http://ir.sogou.com/2020-07-27-Sogou-Announces-Receipt-of-a-Preliminary-Non-Binding-Proposal-to-Acquire-the-Company" target="_blank" rel="noopener">announced</a> it has received a preliminary non-binding proposal from Tencent to acquire all of its outstanding ordinary shares that are not already owned by Tencent, for US$9.00 in cash per ordinary share or ADS. The Offer price is a 57% premium to the undisturbed price and a two-year high.</p>
<p>Today Sogou <a href="http://app.quotemedia.com/data/downloadFiling?webmasterId=101533&amp;ref=115257193&amp;type=PDF&amp;symbol=SOGO&amp;companyName=Sogou+Inc.+American+Depositary+Shares+each+representing+one+Class+A&amp;formType=6-K&amp;dateFiled=2020-09-29&amp;CK=1713947" target="_blank" rel="noopener">entered</a> into a definitive agreement for a Going-Private Transaction at the same Offer price of US$9/share.</p>
<p>Separately, <a href="https://www.smartkarma.com/entities/sohu-com-ltd" target="_blank" data-smartkarma-citation="entities:22853:1" rel="noopener">Sohu.com Inc (SOHU US)</a> has entered into a share purchase agreement with Tencent concerning its stake in Sogou, the completion of which will result in Tencent holding not less than 90% of the voting power in Sogou.</p>
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<p>Therefore the Merger will be in the form of a short-form merger as per section 233(7) of the <em><a href="https://www.cima.ky/upimages/commonfiles/CompaniesLaw2020Revision_1579811065.pdf" target="_blank" rel="noopener">Companies Law of the Cayman Islands</a></em> - there is no vote. There are no dissenting rights.</p>
<p>Done deal - the Merger is expected to close in the fourth quarter of 2020.</p>
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<p>More below the fold.</p>
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Back on the 27 July, Chinese search-engine Sogou Inc (SOGO US), majority-owned by Sohu.com Inc (SOHU US)  and Tencent Holdings (700 HK), announced it has received a preliminary non-binding proposal from Tencent to acquire all of its outstanding ordinary shares that are not already owned by Tencent, for US$9.00 in cash per ordinary share or ADS. The Offer price is a 57% premium to the undisturbed price and a two-year high.
Today Sogou entered into a definitive agreement for a Going-Private Transaction at the same Offer price of US$9/share.
Separately, Sohu.com Inc (SOHU US) has entered into a share purchase agreement with Tencent concerning its stake in Sogou, the completion of which will result in Tencent holding not less than 90% of the voting power in Sogou.


Therefore the Merger will be in the form of a short-form merger as per section 233(7) of the Companies Law of the Cayman Islands - there is no vote. There are no dissenting rights.
Done deal - the Merger is expected to close in the fourth quarter of 2020.


More below the fold.


China

SINA Corporation is a global Internet media company operating Chinese-language destination sites. The Company offers a network of branded content and services targeting people of Chinese descent worldwide. SINA.com offers online news, entertainment, community, and commerce through web sites that are produced and updated by local teams in China, Hong Kong, Taiwan, and North America.

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Sina Corp (Class A) (SINA US)

CBPO's Vote Gets Up But Dissenters Lurk

Currently trading at a gross/annualsed spread of 1.5%/7.5%. This assumes payment mid-May if assuming the negotiation process drags out to its full...

David Blennerhassett

What's Going On With Sina Corp?

Currently trading to terms. This is an avoid. The Offer is being done too cheaply, But unless you have already dissented, you are effectively...

David Blennerhassett

Changyou (CYOU US): Short-Form Merger Dissent Now Permitted

The Court rightfully concluded s.238 provides the right of dissent in a short-form merger. Offerors will now face the prospect of dissension from...

David Blennerhassett

Ant Group Pre-IPO ESG Assessment: Seeing the Forest for the Trees

xxxx Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim...

Kyle Rudden

Sogou/Tencent: And That's A Wrap

Chinese search-engine Sogou Inc (SOGO US), majority-owned by Sohu.com Inc (SOHU US) and Tencent Holdings (700 HK), has announced it has received...

David Blennerhassett

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CBPO's Vote Gets Up But Dissenters Lurk

Currently trading at a gross/annualsed spread of 1.5%/7.5%. This assumes payment mid-May if assuming the negotiation process drags out to its full...

David Blennerhassett

What's Going On With Sina Corp?

Currently trading to terms. This is an avoid. The Offer is being done too cheaply, But unless you have already dissented, you are effectively...

David Blennerhassett

Changyou (CYOU US): Short-Form Merger Dissent Now Permitted

The Court rightfully concluded s.238 provides the right of dissent in a short-form merger. Offerors will now face the prospect of dissension from...

David Blennerhassett

Ant Group Pre-IPO ESG Assessment: Seeing the Forest for the Trees

xxxx Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim...

Kyle Rudden

Sogou/​Tencent: And That's A Wrap

Chinese search-engine Sogou Inc (SOGO US), majority-owned by Sohu.com Inc (SOHU US) and Tencent Holdings (700 HK), has announced it has received...

David Blennerhassett

Sogou/Tencent: And That's A Wrap