Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sun-corp" target="_blank" data-smartkarma-citation="entities:10803:1" rel="noopener">Sun Corp (6736 JP)</a> has declined ~6% in the past month. Its 44.3% stake in <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite DI (CLBT US)</a> is worth ~186% of its market cap.</li>
<li>Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.</li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>



Sun Corp (6736 JP) has declined ~6% in the past month. Its 44.3% stake in Cellebrite DI (CLBT US) is worth ~186% of its market cap.
Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: Sun Corp (6736 JP) Is Still Inexpensive To Its Cellebrite Stake

Travis Lundy

<ul>
<li>Eight months on from the Tender Offer which changed the shape of the shareholder register, <a href="https://www.smartkarma.com/entities/sun-corp" target="_blank" data-smartkarma-citation="entities:10803:1" rel="noopener">Sun Corp (6736 JP)</a> is as cheap to its main asset as it was before.</li>
<li>Sun Corp is cheap to its holding in <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite DI (CLBT US)</a>. How cheap depends on the form and structure of its eventual exit. </li>
<li>Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.</li>
</ul>


Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit. 
Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/sun-corp" target="_blank" data-smartkarma-citation="entities:10803:1" rel="noopener">Sun Corp (6736 JP)</a> has retraced ~15% in the past month. Its 43.8% stake in <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite (CLBT US)</a> is worth ~186% of its market cap, an all-time high. </li>
<li>Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.</li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>



Sun Corp (6736 JP) has retraced ~15% in the past month. Its 43.8% stake in Cellebrite (CLBT US) is worth ~186% of its market cap, an all-time high. 
Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: Sun Corp (6736 JP) Trading Cheap to Cellebrite (CLBT US)

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>Sun Corp (6736 JP): A deep-value holding company trading below the value of its 44% stake in NASDAQ-listed Cellebrite; positioned as a discounted proxy on the growth of digital forensics. </li>
<li>MegaChips (6875 JP): A fabless semiconductor firm with a legacy ASIC business but a hidden asset in its ¥160 billion SiTime stake; City Index Eleven to pressure value unlock</li>
<li>KeePer (6036 JP): A high-margin car detailing business with embedded optionality through its SOFT99 stake; activist entry by Misaki Capital ensures governance pressure.</li>
</ul>


Sun Corp (6736 JP): A deep-value holding company trading below the value of its 44% stake in NASDAQ-listed Cellebrite; positioned as a discounted proxy on the growth of digital forensics. 
MegaChips (6875 JP): A fabless semiconductor firm with a legacy ASIC business but a hidden asset in its ¥160 billion SiTime stake; City Index Eleven to pressure value unlock
KeePer (6036 JP): A high-margin car detailing business with embedded optionality through its SOFT99 stake; activist entry by Misaki Capital ensures governance pressure.


Japan Activist Briefs | Sun Corp, MegaChips, KeePer

<ul>
<li>As with large, clean liquid deals in Asia-Pac, expect <a href="https://www.smartkarma.com/entities/hang-seng-bank-ltd" target="_blank" data-smartkarma-citation="entities:24:1" rel="noopener">Hang Seng (11 HK)</a>'s annualised spreads to widen (i.e. gross spread remains static) as investors hit their full quota early on. </li>
<li>The question is whether <a href="https://www.smartkarma.com/entities/soft99-corp" target="_blank" data-smartkarma-citation="entities:18486:1" rel="noopener">Soft99 (4464 JP)</a>'s MBO Bidco raises the price to  ¥3,200 saying "let's split the difference", and that would make some people happy. It's doubtful they will.</li>
<li>
<a href="https://www.smartkarma.com/entities/sihuan-pharmaceutical-hldgs" target="_blank" data-smartkarma-citation="entities:33:1" rel="noopener">Sihuan Pharmaceutical (460 HK)</a> has benefited a little from the HK$500mn buyback programme announced last October. But a HK$11bn run up in market cap YTD? This looks stretched to me.</li>
</ul>


As with large, clean liquid deals in Asia-Pac, expect Hang Seng (11 HK)'s annualised spreads to widen (i.e. gross spread remains static) as investors hit their full quota early on. 
The question is whether Soft99 (4464 JP)'s MBO Bidco raises the price to  ¥3,200 saying "let's split the difference", and that would make some people happy. It's doubtful they will.

Sihuan Pharmaceutical (460 HK) has benefited a little from the HK$500mn buyback programme announced last October. But a HK$11bn run up in market cap YTD? This looks stretched to me.


Last Week In Event SPACE: Hang Seng Bank, Soft99, Sihuan Pharma, Dongfeng Motor

Japan

SUN CORPORATION operates mainly Pachinko related business, information and communication business.  Pachinko related business includes developing, manufacturing and selling a system to control and monitor pachinko machine, and manage business operation.  Sun Corp. also manufactures Pachinko and household appliances and develops game software for family use.

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Sun Corp (6736 JP)

StubWorld: Sun Corp (6736 JP) Is Still Inexpensive To Its Cellebrite Stake

Trading at a 48% disc. to NAV. ~40% of Sun is held via Oasis and the SPAC Sponsor. They're there to extract maximum look-through value. Be long...

David Blennerhassett

Sun Corp (6736) - Still Cheap

Sun Corp is cheap to its main asset Cellebrite. Even if one assumes the stub is worth only its inventory and its land and other are free, there is...

Travis Lundy

StubWorld: Sun Corp (6736 JP) Trading Cheap to Cellebrite (CLBT US)

Trading at a 48% discount to NAV; or 45% discount to its CLBT holding. Less clear is how, or if, this value materialises. I'd still look to enter...

David Blennerhassett

Japan Activist Briefs | Sun Corp, MegaChips, KeePer

Three overlooked Japanese mid-caps; Sun Corp, MegaChips, and KeePer, reflect a broader shift in Japan’s equity landscape as activists push balance...

Mark Chadwick

Last Week In Event SPACE: Hang Seng Bank, Soft99, Sihuan Pharma, Dongfeng Motor

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

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