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.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/forum-engineering-inc" target="_blank" data-smartkarma-citation="entities:28896:1" rel="noopener">Forum Engineering Inc (7088 JP)</a> has recommended a tender offer from <a href="https://www.smartkarma.com/entities/kkr-co-inc" target="_blank" data-smartkarma-citation="entities:27333:1" rel="noopener">KKR &amp; Co (KKR US)</a> at JPY1,710, a 32.6% premium to the last close price.</li>
<li>The offer is arguably light due to a lack of an auction and is below the midpoint of the target IFA DCF valuation range. </li>
<li>However, the offer is attractive compared to precedent transactions, peer multiples and represents an all-time high. The large number of cross-holders will help meet the required tendering rate.</li>
</ul>



Forum Engineering Inc (7088 JP) has recommended a tender offer from KKR &amp; Co (KKR US) at JPY1,710, a 32.6% premium to the last close price.
The offer is arguably light due to a lack of an auction and is below the midpoint of the target IFA DCF valuation range. 
However, the offer is attractive compared to precedent transactions, peer multiples and represents an all-time high. The large number of cross-holders will help meet the required tendering rate.


Forum Engineering (7088 JP): KKR’s Tender Offer at JPY1,710

<ul>
<li>
<a href="https://www.smartkarma.com/entities/technopro-holdings-inc" target="_blank" data-smartkarma-citation="entities:6955:1" rel="noopener">Technopro Holdings (6028 JP)</a> announced a tender offer from Blackstone at JPY4,870, a 43.7% premium to the undisturbed price of JPY3,389 but at a slight discount to the last close.</li>
<li>While below the last close, Blackstone’s offer was a result of an auction process and was the highest binding offer. The offer also represents a pre-media rumour all-time high.</li>
<li>Surprisingly, Blackstone has not disclosed irrevocables. The Board has a neutral opinion. Nevertheless, a fair auction process suggests there will be limited opposition to the offer. </li>
</ul>



Technopro Holdings (6028 JP) announced a tender offer from Blackstone at JPY4,870, a 43.7% premium to the undisturbed price of JPY3,389 but at a slight discount to the last close.
While below the last close, Blackstone’s offer was a result of an auction process and was the highest binding offer. The offer also represents a pre-media rumour all-time high.
Surprisingly, Blackstone has not disclosed irrevocables. The Board has a neutral opinion. Nevertheless, a fair auction process suggests there will be limited opposition to the offer. 


TechnoPro (6028 JP): Blackstone’s Tender Offer at JPY4,870

<ul>
<li>The <a href="https://finance.yahoo.com/news/blackstone-acquire-japans-technopro-3-094830609.html" target="_blank" rel="noopener">Nikkei reports</a> that <a href="https://www.smartkarma.com/entities/blackstone-inc" target="_blank" data-smartkarma-citation="entities:27166:1" rel="noopener">Blackstone (BX US)</a> will launch the tender offer for <a href="https://www.smartkarma.com/entities/technopro-holdings-inc" target="_blank" data-smartkarma-citation="entities:6955:1" rel="noopener">Technopro Holdings (6028 JP)</a> just below JPY4,900, a 44.6% premium to the undisturbed price.</li>
<li>While the rumoured offer is 1.5% below the last close, it is attractive as it resulted from an auction and represents a pre-media rumour all-time high.</li>
<li>It is unclear if the offer is preconditional on regulatory approvals. Blackstone is likely to secure irrevocables from activists like Orbis to project a secure path to completion. </li>
</ul>


The Nikkei reports that Blackstone (BX US) will launch the tender offer for Technopro Holdings (6028 JP) just below JPY4,900, a 44.6% premium to the undisturbed price.
While the rumoured offer is 1.5% below the last close, it is attractive as it resulted from an auction and represents a pre-media rumour all-time high.
It is unclear if the offer is preconditional on regulatory approvals. Blackstone is likely to secure irrevocables from activists like Orbis to project a secure path to completion. 


TechnoPro (6028 JP): Blackstone’s Rumoured Takeunder Offer

<ul>
<li>
<a href="https://www.smartkarma.com/entities/technopro-holdings-inc" target="_blank" data-smartkarma-citation="entities:6955:1" rel="noopener">Technopro Holdings (6028 JP)</a>  shares were up 20.7% on Friday based on a Mergermarket report that is conducting a privatisation auction with bids due in six weeks.</li>
<li>Technopro responded that it has been continuously exploring various strategic alternatives, including privatisation, to enhance shareholder value. TechnoPro has the characteristics to make a good privatisation target. </li>
<li>The precedent is Bain's privatisation of <a href="https://www.smartkarma.com/entities/outsourcing-inc" target="_blank" data-smartkarma-citation="entities:7431:1" rel="noopener">Outsourcing Inc (2427 JP)</a> at a forward EV/EBITDA multiple of 13.5x. A similar multiple implies a JPY4,400 offer. TechnoPro can justify a higher multiple. </li>
</ul>



Technopro Holdings (6028 JP)  shares were up 20.7% on Friday based on a Mergermarket report that is conducting a privatisation auction with bids due in six weeks.
Technopro responded that it has been continuously exploring various strategic alternatives, including privatisation, to enhance shareholder value. TechnoPro has the characteristics to make a good privatisation target. 
The precedent is Bain's privatisation of Outsourcing Inc (2427 JP) at a forward EV/EBITDA multiple of 13.5x. A similar multiple implies a JPY4,400 offer. TechnoPro can justify a higher multiple. 


TechnoPro (6028 JP): A Good Privatisation Candidate

Quality-first, Business-perspective Strategy, Urbem (HK) Limited

Steven Chen

Quality-first, Business-perspective Strategy

Thematic (Sector/Industry)

<ul>
<li>We think that investors can often find attractive opportunities among companies serving the HR department;</li>
<li>When it comes to the Japanese market, employment services companies can additionally take advantage of multiple tailwinds in our view;</li>
<li>We started with our favorable and demanding metric to shortlist 25 names across various industries within the sector, further examined them in terms of growth and cash generation, and ended with three of our top picks.</li>
</ul>


We think that investors can often find attractive opportunities among companies serving the HR department;
When it comes to the Japanese market, employment services companies can additionally take advantage of multiple tailwinds in our view;
We started with our favorable and demanding metric to shortlist 25 names across various industries within the sector, further examined them in terms of growth and cash generation, and ended with three of our top picks.


Quick Picks: Top-Quality Employment Services Providers From Japan

Japan

WDB Holdings Co Ltd provides human resource services.  The Company specializes in temporary staffing and permanent employee introductions in fields such as biotechnology, chemistry, and engineering.

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WDB Holdings (2475 JP)

Forum Engineering (7088 JP): KKR’s Tender Offer at JPY1,710

While the offer is arguably light, as it falls below the midpoint of the IFA DCF range, it remains attractive compared to precedent transactions,...

Arun George

TechnoPro (6028 JP): Blackstone’s Tender Offer at JPY4,870

While below the last close, Blackstone’s offer was a result of an auction process and was the highest binding offer. The offer also represents a...

Arun George

TechnoPro (6028 JP): Blackstone’s Rumoured Takeunder Offer

While the rumoured offer is 1.5% below the last close, it is attractive as it resulted from an auction and represents a pre-media rumour all-time...

Arun George

TechnoPro (6028 JP): A Good Privatisation Candidate

Precedent transaction multiples imply a JPY4,400 offer. TechnoPro can justify a higher multiple due to its market-leading position and solid...

Arun George

Quick Picks: Top-Quality Employment Services Providers From Japan

We started with our favorable and demanding metric to shortlist 25 names, further examined them in terms of growth and cash generation, and ended...

Steven Chen

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)