Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Hotel Property Investments / Event-Driven

<ul>
<li>Back on the 9th September, pub play <a href="https://www.smartkarma.com/entities/hotel-property-investments" target="_blank" data-smartkarma-citation="entities:9850:1" rel="noopener">Hotel Property Investments (HPI AU)</a> announced - and summarily <a href="https://announcements.asx.com.au/asxpdf/20240909/pdf/067ntttrhq85j9.pdf" target="_blank" rel="noopener">rejected</a> - a A$3.65/share cash Offer from <a href="https://www.smartkarma.com/entities/charter-hall-retail-reit" target="_blank" data-smartkarma-citation="entities:11375:1" rel="noopener">Charter Hall Retail Reit (CQR AU)</a>.</li>
<li>Charter Hall has now <a href="https://announcements.asx.com.au/asxpdf/20241018/pdf/0698jwgh9vfx9k.pdf" target="_blank" rel="noopener">increased terms to A$3.85/share</a> (best &amp; final), a 17.7% premium to undisturbed. The Offer remains conditional on an 50.1% minimum acceptance condition. Charter Hall holds 14.7%. </li>
<li>
HPI's <a href="https://www.sharecafe.com.au/2024/10/18/charter-hall-ups-the-ante-with-final-hpi-bid/" target="_blank" rel="noopener">reported</a> response? "While Charter Hall’s improved offer provides an attractive exit for shareholders, we remain committed to evaluating all options that deliver the best long-term value."</li>
</ul>


Back on the 9th September, pub play Hotel Property Investments (HPI AU) announced - and summarily rejected - a A$3.65/share cash Offer from Charter Hall Retail Reit (CQR AU).
Charter Hall has now increased terms to A$3.85/share (best &amp; final), a 17.7% premium to undisturbed. The Offer remains conditional on an 50.1% minimum acceptance condition. Charter Hall holds 14.7%. 

HPI's reported response? "While Charter Hall’s improved offer provides an attractive exit for shareholders, we remain committed to evaluating all options that deliver the best long-term value."


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>The review period for the September rebalance ends on 30 August. We do not see any constituent changes for the index but there will be capping changes.</li>
<li>
<a href="https://www.smartkarma.com/entities/home-consortium-ltd" target="_blank" data-smartkarma-citation="entities:29082:1" rel="noopener">Home Consortium Ltd (HMC AU)</a> is just outside inclusion zone at the moment and outperformance over the rest of the week could result in inclusion.</li>
<li>
<a href="https://www.smartkarma.com/entities/home-consortium-ltd" target="_blank" data-smartkarma-citation="entities:29082:1" rel="noopener">Home Consortium Ltd (HMC AU)</a>'s inclusion and capping changes will result in a one-way turnover of 5% and in a round-trip trade of A$62m. </li>
</ul>


The review period for the September rebalance ends on 30 August. We do not see any constituent changes for the index but there will be capping changes.

Home Consortium Ltd (HMC AU) is just outside inclusion zone at the moment and outperformance over the rest of the week could result in inclusion.

Home Consortium Ltd (HMC AU)'s inclusion and capping changes will result in a one-way turnover of 5% and in a round-trip trade of A$62m. 


MV Australia A-REITs Index Rebalance Preview: One Close Add & Capping Changes

HomeCo Daily Needs REIT / Index Rebalance

<ul>
<li>The upcoming rebalance of the MVIS Australia A-REIT Index will be implemented at the close on 16 June. There are no constituent changes, but there are float and capping changes.</li>
<li>Estimated one-way turnover at the rebalance is 2.7% resulting in a one-way trade of A$16.6m. There is limited impact on the index constituents.</li>
<li>The largest inflows are on <a href="https://www.smartkarma.com/entities/scentre-group" target="_blank" data-smartkarma-citation="entities:9538:1" rel="noopener">Scentre Group</a>, <a href="https://www.smartkarma.com/entities/homeco-daily-needs-reit" target="_blank" data-smartkarma-citation="entities:33526:1" rel="noopener">HomeCo Daily Needs REIT</a> and <a href="https://www.smartkarma.com/entities/shopping-centres-australasia" target="_blank" data-smartkarma-citation="entities:20100:1" rel="noopener">Region Re</a>, while the largest outflows are on <a href="https://www.smartkarma.com/entities/stockland" target="_blank" data-smartkarma-citation="entities:661:1" rel="noopener">Stockland</a>, <a href="https://www.smartkarma.com/entities/mirvac-group" target="_blank" data-smartkarma-citation="entities:20681:1" rel="noopener">Mirvac Group</a>, <a href="https://www.smartkarma.com/entities/dexus" target="_blank" data-smartkarma-citation="entities:403:1" rel="noopener">Dexus Property</a> and <a href="https://www.smartkarma.com/entities/goodman-group" target="_blank" data-smartkarma-citation="entities:959:1" rel="noopener">Goodman Group</a>.</li>
</ul>


The upcoming rebalance of the MVIS Australia A-REIT Index will be implemented at the close on 16 June. There are no constituent changes, but there are float and capping changes.
Estimated one-way turnover at the rebalance is 2.7% resulting in a one-way trade of A$16.6m. There is limited impact on the index constituents.
The largest inflows are on Scentre Group, HomeCo Daily Needs REIT and Region Re, while the largest outflows are on Stockland, Mirvac Group, Dexus Property and Goodman Group.


MVIS Australia A-REITs Index Rebalance: Float & Capping Changes

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares.</li>
<li>The company will use the proceeds from the placement to pay down debt that it has accumulated from earlier acquisition/construction.</li>
<li>In this note, we will talk about the recent developments and run the deal through our ECM framework.</li>
</ul>


Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares.
The company will use the proceeds from the placement to pay down debt that it has accumulated from earlier acquisition/construction.
In this note, we will talk about the recent developments and run the deal through our ECM framework.


Abacus Property Group Placement - Previous Deal Did Well, This One Won’t Be Accretive

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<a href="https://www.smartkarma.com/entities/aventus-group" target="_blank" data-smartkarma-citation="entities:25897:1" rel="noopener">Aventus Group (AVN AU)</a> is Australia’s largest fully integrated owner, manager and developer of large format retail centres in Australia. Aventus entered a scheme implementation deed to implement a merger with <a href="https://www.smartkarma.com/entities/homeco-daily-needs-reit" target="_blank" data-smartkarma-citation="entities:33526:1" rel="noopener">HomeCo Daily Needs REIT (HDN AU)</a> and <a href="https://www.smartkarma.com/entities/home-consortium-ltd" target="_blank" data-smartkarma-citation="entities:29082:1" rel="noopener">Home Consortium Ltd (HMC AU)</a>. Aventus securityholders will be offered 2.200 HDN units for every 1 unit in Aventus Retail Property Fund (93% of transaction value) and A$0.285 cash or 0.038 HMC securities for every 1 share in Aventus Holdings Limited (7% of transaction value). The implied offer price of A$3.82 per Aventus share is a 15.3% premium to the unaffected price of A$3.31 (15 October). The offer price will not be reduced for any distributions announced by Aventus, HDN and HMC prior to the implementation. Post-merger, Aventus securityholders will own 47.1% of the merged group.The scheme is conditional on AVN securityholder approval by at least 75% of the votes cast and 50% securityholders voting. Brett Blundy Retail Capital (BBRC) and the Aventus Board which represents 22.6% and 6.7% of AVN securities, respectively, intend to vote in favour of the merger. The scheme is also conditional on HDN unitholder approval by at least 50% of votes cast (HMC cannot vote). <div class="content-highlight">We think that recommended offer is attractive both in terms of historical multiples and share prices for Aventus securityholders. The merger is also FFO and NTA accretive to Aventus securityholders. While the merger is FFO accretive, it is NTA dilutive to HDN unitholders. Nevertheless, the strong strategic rationale for the merger should gain support from HDN unitholders. At the last close prices of Aventus and HDN, Aventus’ shares are trading at 3.6% gross spread to the indicative offer.</div>

Aventus Group (AVN AU) is Australia’s largest fully integrated owner, manager and developer of large format retail centres in Australia. Aventus entered a scheme implementation deed to implement a merger with HomeCo Daily Needs REIT (HDN AU) and Home Consortium Ltd (HMC AU). Aventus securityholders will be offered 2.200 HDN units for every 1 unit in Aventus Retail Property Fund (93% of transaction value) and A$0.285 cash or 0.038 HMC securities for every 1 share in Aventus Holdings Limited (7% of transaction value). The implied offer price of A$3.82 per Aventus share is a 15.3% premium to the unaffected price of A$3.31 (15 October). The offer price will not be reduced for any distributions announced by Aventus, HDN and HMC prior to the implementation. Post-merger, Aventus securityholders will own 47.1% of the merged group.The scheme is conditional on AVN securityholder approval by at least 75% of the votes cast and 50% securityholders voting. Brett Blundy Retail Capital (BBRC) and the Aventus Board which represents 22.6% and 6.7% of AVN securities, respectively, intend to vote in favour of the merger. The scheme is also conditional on HDN unitholder approval by at least 50% of votes cast (HMC cannot vote). We think that recommended offer is attractive both in terms of historical multiples and share prices for Aventus securityholders. The merger is also FFO and NTA accretive to Aventus securityholders. While the merger is FFO accretive, it is NTA dilutive to HDN unitholders. Nevertheless, the strong strategic rationale for the merger should gain support from HDN unitholders. At the last close prices of Aventus and HDN, Aventus’ shares are trading at 3.6% gross spread to the indicative offer.

Aventus Recommended Merger with HomeCo Daily Needs REIT

Australia

Waypoint REIT Limited (previously Viva Energy REIT) operates as a real estate investment trust. The Trust owns a portfolio of service station sites located throughout Australia.  Viva Energy REIT also acquires fuel refining and retailing businesses.

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Waypoint REIT (WPR AU)

Charter Hall Bumps With Final HPI Bid

I expected Charter Hall to nudge the terms higher to secure board support. But I don't believe a 5% bump will cut it. If an arbitrageur, I'd be...

David Blennerhassett

MV Australia A-REITs Index Rebalance Preview: One Close Add & Capping Changes

No constituent changes expected for now. HMC is a very close add and needs to outperform over the next 3 trading days to make it into the index....

Brian Freitas

MVIS Australia A-REITs Index Rebalance: Float & Capping Changes

There are no constituent changes in June but there are float & capping changes. Estimated one-way turnover at the rebalance is 2.7% resulting in a...

Brian Freitas

Abacus Property Group Placement - Previous Deal Did Well, This One Won’t Be Accretive

Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares. In this note, we will run the deal through our ECM...

Sumeet Singh

Aventus Recommended Merger with HomeCo Daily Needs REIT

The offer is attractive in terms of P/NTA and share prices for AVN. The merger is also FFO and NTA accretive to AVN. The strong strategic rationale...

Arun George

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