Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On the 6 May, <a href="https://www.smartkarma.com/entities/yashili-international-holdings-ltd" target="_blank" data-smartkarma-citation="entities:3397:1" rel="noopener">Yashili International Holdings (1230 HK)</a> announced a pre-conditional Offer, by way of a Scheme, from <a href="https://www.smartkarma.com/entities/china-mengniu-dairy-co" target="_blank" data-smartkarma-citation="entities:354:1" rel="noopener">China Mengniu Dairy Co (2319 HK)</a>.</li>
<li>Pre-Conditions concern three sales and purchase agreements, including Danone selling, and Mengniu acquiring 25% of Yashili at HK$1.20/share. A 16 August EGM will enable shareholders to vote on the SPAs.</li>
<li>Assuming the SPAs are approved, Mengniu will make an Offer at HK$1.20/share, a 161% premium to the undisturbed price.  </li>
</ul>


On the 6 May, Yashili International Holdings (1230 HK) announced a pre-conditional Offer, by way of a Scheme, from China Mengniu Dairy Co (2319 HK).
Pre-Conditions concern three sales and purchase agreements, including Danone selling, and Mengniu acquiring 25% of Yashili at HK$1.20/share. A 16 August EGM will enable shareholders to vote on the SPAs.
Assuming the SPAs are approved, Mengniu will make an Offer at HK$1.20/share, a 161% premium to the undisturbed price.  


Yashili: 16th August EGM To Vote On Three SPAs

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.

<ul>
<li>We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand and Chinese ADRs.</li>
<li>The highest spreads are <a href="https://www.smartkarma.com/entities/21-vianet-group-inc-adr" target="_blank" data-smartkarma-citation="entities:8489:1" rel="noopener">21Vianet Group (VNET US)</a>, <a href="https://www.smartkarma.com/entities/alliance-aviation-services-ltd" target="_blank" data-smartkarma-citation="entities:20401:1" rel="noopener">Alliance Aviation Services (AQZ AU)</a>, <a href="https://www.smartkarma.com/entities/narhex-life-sciences-ltd" target="_blank" data-smartkarma-citation="entities:9728:1" rel="noopener">Resapp Health (RAP AU)</a>, <a href="https://www.smartkarma.com/entities/ramsay-health-care-ltd" target="_blank" data-smartkarma-citation="entities:673:1" rel="noopener">Ramsay Health Care (RHC AU)</a>, <a href="https://www.smartkarma.com/entities/yashili-international-holdings-ltd" target="_blank" data-smartkarma-citation="entities:3397:1" rel="noopener">Yashili International Holdings (1230 HK)</a>, Link Admin. </li>
<li>Lowest gross spreads are <a href="https://www.smartkarma.com/entities/hwa-hong-corp-ltd" target="_blank" data-smartkarma-citation="entities:6648:1" rel="noopener">Hwa Hong Corp (HWAH SP)</a>, <a href="https://www.smartkarma.com/entities/excelpoint-technology-ltd" target="_blank" data-smartkarma-citation="entities:1774:1" rel="noopener">Excelpoint Technology (EXLP SP)</a>, <a href="https://www.smartkarma.com/entities/giordano-international-ltd" target="_blank" data-smartkarma-citation="entities:13899:1" rel="noopener">Giordano International (709 HK)</a>, <a href="https://www.smartkarma.com/entities/mydeal-com-au-ltd" target="_blank" data-smartkarma-citation="entities:30939:1" rel="noopener">MyDeal.com.au Ltd (MYD AU)</a>, <a href="https://www.smartkarma.com/entities/cocoaland-holdings-bhd" target="_blank" data-smartkarma-citation="entities:493:1" rel="noopener">Cocoaland Holdings (COLA MK)</a>, <a href="https://www.smartkarma.com/entities/maca-ltd" target="_blank" data-smartkarma-citation="entities:11390:1" rel="noopener">MACA Ltd (MLD AU)</a>. </li>
</ul>


We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand and Chinese ADRs.
The highest spreads are 21Vianet Group (VNET US), Alliance Aviation Services (AQZ AU), Resapp Health (RAP AU), Ramsay Health Care (RHC AU), Yashili International Holdings (1230 HK), Link Admin. 
Lowest gross spreads are Hwa Hong Corp (HWAH SP), Excelpoint Technology (EXLP SP), Giordano International (709 HK), MyDeal.com.au Ltd (MYD AU), Cocoaland Holdings (COLA MK), MACA Ltd (MLD AU). 


Merger Arb Mondays (01 Aug) - Genex, Yashili, Link Admin, VNET, Ramsay, Alliance Aviation

China VAST Industrial Urban Development / Event-Driven

China VAST Industrial Urban Development (CVI HK)

<ul>
<li>After a prolonged delay, the Cayman Islands legislative gazette <a href="https://legislation.gov.ky/cms/images/LEGISLATION/AMENDING/2022/2022-0028/CompaniesAmendmentAct2021CommencementOrder2022SL28of2022.pdf" target="_blank" rel="noopener">was published on 29 July</a>, which stated that the amended Cayman Islands Act would come into force on 31 August. </li>
<li>The Act will remove the headcount test for schemes, eliminating a layer of uncertainty for controlling shareholders wishing to privatise listed Cayman-incorporated companies.</li>
<li>In light of this development, we look at current active privatisations, past failed privatisations and rumoured transactions which stand to gain a new lease of life from this Act.</li>
</ul>


After a prolonged delay, the Cayman Islands legislative gazette was published on 29 July, which stated that the amended Cayman Islands Act would come into force on 31 August. 
The Act will remove the headcount test for schemes, eliminating a layer of uncertainty for controlling shareholders wishing to privatise listed Cayman-incorporated companies.
In light of this development, we look at current active privatisations, past failed privatisations and rumoured transactions which stand to gain a new lease of life from this Act.


The Cayman Islands to Remove the Headcount Test on 31 August

<ul>
<li>The approval by <a href="https://www.smartkarma.com/entities/yashili-international-holdings-ltd" target="_blank" data-smartkarma-citation="entities:3397:1" rel="noopener">Yashili International Holdings (1230 HK)</a> independent shareholders of the proposed transactions at the 16 August EGM is a pre-condition to the HK$1.20 per share privatisation proposal.</li>
<li>Shareholders will pass the ordinary resolutions at the EGM so that they can vote on the attractive privatisation proposal. The key risk is timing around the satisfaction of the pre-conditions.</li>
<li>
<a href="https://www.smartkarma.com/entities/china-mengniu-dairy-co" target="_blank" data-smartkarma-citation="entities:354:1" rel="noopener">China Mengniu Dairy Co (2319 HK)</a>’s offer remains attractive in the context of multiples and historical share prices. At the last close, the gross spread to the offer is 10.1%.</li>
</ul>


The approval by Yashili International Holdings (1230 HK) independent shareholders of the proposed transactions at the 16 August EGM is a pre-condition to the HK$1.20 per share privatisation proposal.
Shareholders will pass the ordinary resolutions at the EGM so that they can vote on the attractive privatisation proposal. The key risk is timing around the satisfaction of the pre-conditions.

China Mengniu Dairy Co (2319 HK)’s offer remains attractive in the context of multiples and historical share prices. At the last close, the gross spread to the offer is 10.1%.


Yashili’s Pre-Condition EGM Set for 16 August

<ul>
<li>Given recent corporate events in S-REIT land, there could be some considerable money to be allocated to the sector near-term</li>
<li>
<a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba (ADR) (BABA US)</a> / <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> issued an announcement it would pursue a primary listing on the HKEX. This will make BABA Southbound-eligible</li>
<li>At 0.81x newly-lowered book value, <a href="https://www.smartkarma.com/entities/australian-unity-office-fund" target="_blank" data-smartkarma-citation="entities:24077:1" rel="noopener">Australian Unity Office Fund (AOF AU)</a> is trading at a relatively low multiple. </li>
</ul>


Given recent corporate events in S-REIT land, there could be some considerable money to be allocated to the sector near-term

Alibaba (ADR) (BABA US) / Alibaba Group (9988 HK) issued an announcement it would pursue a primary listing on the HKEX. This will make BABA Southbound-eligible
At 0.81x newly-lowered book value, Australian Unity Office Fund (AOF AU) is trading at a relatively low multiple. 


Last Week in Event SPACE: Mapletree, Alibaba, Australian Unity Office

China

Yashili International Holdings Ltd. manufactures and sells dairy and nourishment products, primarily focusing on infant milk formula under brands like Yashily, Reeborne, and Dumex. The company also offers adult and children's milk powder, soymilk powder, rice flour, and cereal products. It was founded in 1983 and is headquartered in Causeway Bay, Hong Kong.

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Yashili (1230 HK)

Yashili: 16th August EGM To Vote On Three SPAs

HK$1.20/share will get up. At a 11% gross spread to terms, and potential completion in the 4Q22, I'd be a buyer of Yashili here.

David Blennerhassett

Merger Arb Mondays (01 Aug) - Genex, Yashili, Link Admin, VNET, Ramsay, Alliance Aviation

This week, the highest gross spreads are VNET (55.0%), Alliance Aviation (47.5%), ResApp (27.0%), Ramsay (24.7%), Yashili (10.1%), Link Admin...

Arun George

The Cayman Islands to Remove the Headcount Test on 31 August

We expect the removal of the headcount test to stir up activity in privatisations of HKEx-listed Cayman-incorporated companies, especially in light...

Arun George

Yashili’s Pre-Condition EGM Set for 16 August

The EGM will take a convoluted transaction further to completion. Expect the spread to narrow. At the last close, the gross spread to the offer is...

Arun George

Last Week in Event SPACE: Mapletree, Alibaba, Australian Unity Office

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

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