Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Yesterday afternoon, <a href="https://www.smartkarma.com/entities/swire-pacific-ltd-cl-a" target="_blank" data-smartkarma-citation="entities:10433:1" rel="noopener">Swire Pacific (A) (19 HK)</a> | <a href="https://www.smartkarma.com/entities/swire-pacific-ltd" target="_blank" data-smartkarma-citation="entities:23726:1" rel="noopener">Swire Pacific (B) (87 HK)</a> announced a new buyback program. The last one was announced August 2022 and ran until the AGM.</li>
<li>That was HK$4bn. In the meantime the company paid an HK$8.12 special div on the Swire As (14%) in September (on top of the HK$1.20 regular div). </li>
<li>Now they have announced a new HK$6bn buyback buying both A Shares and B shares. Details, index impact, historical B/A trading patterns, etc, below.</li>
</ul>


Yesterday afternoon, Swire Pacific (A) (19 HK) | Swire Pacific (B) (87 HK) announced a new buyback program. The last one was announced August 2022 and ran until the AGM.
That was HK$4bn. In the meantime the company paid an HK$8.12 special div on the Swire As (14%) in September (on top of the HK$1.20 regular div). 
Now they have announced a new HK$6bn buyback buying both A Shares and B shares. Details, index impact, historical B/A trading patterns, etc, below.


Swire (19 HK / 87 HK) Announces NEW, Bigger, Better Buyback

David Blennerhassett

<ul>
<li>Yesterday afternoon (5th Dec), <a href="https://www.smartkarma.com/entities/swire-pacific-ltd-cl-a" target="_blank" data-smartkarma-citation="entities:10433:1" rel="noopener">Swire Pacific (A) (19 HK)</a> (and <a href="https://www.smartkarma.com/entities/swire-pacific-ltd" target="_blank" data-smartkarma-citation="entities:23726:1" rel="noopener">Swire Pacific (B) (87 HK)</a>) <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2023/1205/2023120501177.pdf" target="_blank" rel="noopener">announced</a> a large (HK$6bn) buyback.</li>
<li>The response this morning sees Swire A up 14.4% (as I type), and 11.8% for Swire Bs.</li>
<li>I still like the idea of buying Swire A and Swire B outright here.</li>
</ul>


Yesterday afternoon (5th Dec), Swire Pacific (A) (19 HK) (and Swire Pacific (B) (87 HK)) announced a large (HK$6bn) buyback.
The response this morning sees Swire A up 14.4% (as I type), and 11.8% for Swire Bs.
I still like the idea of buying Swire A and Swire B outright here.


<ul>
<li>Last night, Swire Pacific announced it planned to sell its US Coca Cola Distribution business to its parent company. That means a Circular, an IFA Opinion, and an EGM.</li>
<li>I expect a September EGM and the Special Div to follow in Q4. While I find the price low, I expect the deal to be approved by Swire shareholders.</li>
<li>This deal has an effect on the Swire B/A ratio. Some may get it. Some may not. Makes sense to be ready. Swire A is cheap. Swire B is cheaper.</li>
</ul>


Last night, Swire Pacific announced it planned to sell its US Coca Cola Distribution business to its parent company. That means a Circular, an IFA Opinion, and an EGM.
I expect a September EGM and the Special Div to follow in Q4. While I find the price low, I expect the deal to be approved by Swire shareholders.
This deal has an effect on the Swire B/A ratio. Some may get it. Some may not. Makes sense to be ready. Swire A is cheap. Swire B is cheaper.


Swire Coke Sale Special Div Impacts B/A Ratio

<ul>
<li>A double dose of StubWorld this week. <a href="https://www.smartkarma.com/entities/swire-pacific-ltd-cl-a" target="_blank" data-smartkarma-citation="entities:10433:1" rel="noopener">Swire Pacific (A) (19 HK)</a>'s P/B is back down to 0.31x as <a href="https://www.smartkarma.com/entities/cathay-pacific-airways-ltd" target="_blank" data-smartkarma-citation="entities:243:1" rel="noopener">Cathay Pacific (293 HK)</a> tackles alleged language bias by flight attendants.</li>
<li>Preceding my comments on Japan Post 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>


A double dose of StubWorld this week. Swire Pacific (A) (19 HK)'s P/B is back down to 0.31x as Cathay Pacific (293 HK) tackles alleged language bias by flight attendants.
Preceding my comments on Japan Post 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: Swire Drifts Lower As Cathay Faces Discrimination Claim

<ul>
<li>In August this year, Swire Pacific started a buyback programme for up to HK$4.0 billion worth of their shares (<a href="https://www.smartkarma.com/entities/swire-pacific-ltd-cl-a" target="_blank" data-smartkarma-citation="entities:10433:1" rel="noopener">Swire Pacific (A) (19 HK)</a> | <a href="https://www.smartkarma.com/entities/swire-pacific-ltd" target="_blank" data-smartkarma-citation="entities:23726:1" rel="noopener">Swire Pacific (B) (87 HK)</a>).</li>
<li>The shares went up. And B briefly outperformed A, but since then, the B/A ratio has fallen and my impression was Swire may have been misinterpreting the buyback rules.</li>
<li>Swire had been buying both every day. But they've been Buying Bs but no As for the last ten days in a row. This begs a few questions.</li>
</ul>


In August this year, Swire Pacific started a buyback programme for up to HK$4.0 billion worth of their shares (Swire Pacific (A) (19 HK) | Swire Pacific (B) (87 HK)).
The shares went up. And B briefly outperformed A, but since then, the B/A ratio has fallen and my impression was Swire may have been misinterpreting the buyback rules.
Swire had been buying both every day. But they've been Buying Bs but no As for the last ten days in a row. This begs a few questions.


Hong Kong

Swire Pacific Limited, through its subsidiaries, operates in the real estate, aviation, beverage, industrial, marine services, trading, and industrial businesses.

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Swire Pacific (A) (19 HK)

Swire (19 HK / 87 HK) Announces NEW, Bigger, Better Buyback

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StubWorld: Swire's Latest Buyback

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Swire Coke Sale Special Div Impacts B/A Ratio

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Travis Lundy

StubWorld: Swire Drifts Lower As Cathay Faces Discrimination Claim

I prefer Pac here over Props, but it's not a high-conviction trade. Given the rebound, you could probably look to unwind a long Swire Pac (B) vs...

David Blennerhassett

Swire Now Buying Back B Shares Only

Swire's buyback has been going on 5 months. They are now 65.6% done. A new development is that in the last ten days, they have only been buying B...

Travis Lundy

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