Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<a href="https://www.smartkarma.com/entities/12901" target="_blank" data-smartkarma-citation="entities:12901:1">Cityneon Holdings (CITN SP)</a> <a href="http://infopub.sgx.com/FileOpen/West%20Knighton%20Offer%20Announcement.ashx?App=Announcement&amp;FileID=531380" target="_blank">announced</a> West Knighton Limited has purchased 168,692,268 shares of Cityneon from Lucrum 1 Investment Limited (Lucrum), representing approximately 68.95% of shares out, at S$1.30/share or a total consideration of S$219.3mn.
As a result of this acquisition, the West Knighton is required to make a mandatory unconditional cash Offer for all the Shares, other than those already owned.  The mandatory Offer price is also S$1.30 (a 3.2% premium to last close) and is unconditional in all respects. 
West Knighton has stated it does not intend to increase the Offer price. Dividends declared or paid after this announcement will be netted off the Offer price.  West Knighton also intends to delist the company and will exercise its right to compulsory acquisition if afforded.
This is by no means not a knock-out price and is ~10% below the consensus target price of S$1.40+. The mandatory Offer is triggered via the major shareholder existing (having entered a year ago), and is largely an opportunistic Offer to secure a larger stake in the company.
I would not tender into the Offer and recommend buying at or just below the $1.30 Offer Price, which provides a temporary floor. Cityneon is likely to surprise to the upside in earnings after securing its 4th intellectual property (IP) right in May (an exclusive worldwide touring exhibition license agreement with Lions Gate Exhibition for The Hunger Games: The Exhibition), together with an agreement with Universal Pictures to build the second set for Jurassic World – The Exhibition.

Cityneon Holdings (CITN SP) announced West Knighton Limited has purchased 168,692,268 shares of Cityneon from Lucrum 1 Investment Limited (Lucrum), representing approximately 68.95% of shares out, at S$1.30/share or a total consideration of S$219.3mn.
As a result of this acquisition, the West Knighton is required to make a mandatory unconditional cash Offer for all the Shares, other than those already owned.  The mandatory Offer price is also S$1.30 (a 3.2% premium to last close) and is unconditional in all respects. 
West Knighton has stated it does not intend to increase the Offer price. Dividends declared or paid after this announcement will be netted off the Offer price.  West Knighton also intends to delist the company and will exercise its right to compulsory acquisition if afforded.
This is by no means not a knock-out price and is ~10% below the consensus target price of S$1.40+. The mandatory Offer is triggered via the major shareholder existing (having entered a year ago), and is largely an opportunistic Offer to secure a larger stake in the company.
I would not tender into the Offer and recommend buying at or just below the $1.30 Offer Price, which provides a temporary floor. Cityneon is likely to surprise to the upside in earnings after securing its 4th intellectual property (IP) right in May (an exclusive worldwide touring exhibition license agreement with Lions Gate Exhibition for The Hunger Games: The Exhibition), together with an agreement with Universal Pictures to build the second set for Jurassic World – The Exhibition. 

Pan-Asia Equity Bottom-up, Wickhams Hill

Lloyd Moffatt

Pan-Asia Equity Bottom-up

Research-Intensive Fundamental Value Advisor

Wickhams Hill

Wickhams Hill Capital is a research-intensive fundamental value advisor, on long and occasionally short investment opportunities concentrated in small and mid-cap public companies.

Thematic (Sector/Industry)

This is the second instalment of Wickhams Hill’s monthly note covering the performance of small-cap markets across ASEAN and Hong Kong. While starting small, we hope to build out the content over time to be more useful and insightful for readers. Any feedback or suggestions are most welcome in the comments below.Market OverviewSmall-cap indices were down across the board with the exception of Singapore and the Philippines, where WHC indices were up 2.7% and 4.7% respectively. Thailand was the…

This is the second instalment of Wickhams Hill’s monthly note covering the performance of small-cap markets across ASEAN and Hong Kong. While starting small, we hope to build out the content over time to be more useful and insightful for readers. Any feedback or suggestions are most welcome in the comments below.Market OverviewSmall-cap indices were down across the board with the exception of Singapore and the Philippines, where WHC indices were up 2.7% and 4.7% respectively. Thailand was the…

Asia Small-Cap: Top Movers, Buybacks and Insider Dealing - Feb'18

China

Teamway International Group Holdings Limited operates as a holding company. The Company, through its subsidiaries, designs, manufactures, and sales polystyrene and polyolefin for packaging of consumer electrical appliances such as televisions, air conditioners, washing machines, and refrigerators. Teamway International Group Holdings serves customers worldwide.

Teamway International (1239 HK)

Cityneon - Buy For The Back-End

Cityneon Holdings (CITN SP) announced West Knighton Limited has purchased 168,692,268 shares of Cityneon from Lucrum 1 Investment Limited (Lucrum),...

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Asia Small-Cap: Top Movers, Buybacks and Insider Dealing - Feb'18

This is the second instalment of Wickhams Hill’s monthly note covering the performance of small-cap markets across ASEAN and Hong Kong. While...

Lloyd Moffatt