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>EQT/<a href="https://www.smartkarma.com/entities/digital-garage-inc" target="_blank" data-smartkarma-citation="entities:13747:1" rel="noopener">Digital Garage (4819 JP)</a> revised its offer for <a href="https://www.smartkarma.com/entities/kakaku-com-inc" target="_blank" data-smartkarma-citation="entities:7408:1" rel="noopener">Kakaku.com Inc (2371 JP)</a> to JPY3,570, a 3.5% premium over the previous JPY3,450 offer and a 1.4% premium over Bain/LY’s JPY3,520 base offer.</li>
<li>The latest EQT/DG offer is the minimum needed to stay on the right side of the competing-offer clauses, thereby retaining KDDI’s support and potentially getting Oasis to switch allegiance.</li>
<li>Bain/<a href="https://www.smartkarma.com/entities/ly-corp" target="_blank" data-smartkarma-citation="entities:19603:1" rel="noopener">LY (4689 JP)</a> continue to have room to respond with a revised offer. The competitive auction could push the final winning bid towards JPY3,800.</li>
</ul>


EQT/Digital Garage (4819 JP) revised its offer for Kakaku.com Inc (2371 JP) to JPY3,570, a 3.5% premium over the previous JPY3,450 offer and a 1.4% premium over Bain/LY’s JPY3,520 base offer.
The latest EQT/DG offer is the minimum needed to stay on the right side of the competing-offer clauses, thereby retaining KDDI’s support and potentially getting Oasis to switch allegiance.
Bain/LY (4689 JP) continue to have room to respond with a revised offer. The competitive auction could push the final winning bid towards JPY3,800.


Kakaku.com (2371 JP): EQT/DG Again Outbids Bain/LY

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>In what is rapidly becoming tedious, EQT+DG have raised their bid on Kakaku.com by 3.48% to thwart Bain's bid, which is now just 1.96% above EQT's bid. </li>
<li>If Bain wants to "win", it has to come over the top. They can raise by ¥2/share and that refreshes everything but that would just allow EQT to raise ¥2/share.</li>
<li>Kakaku.com should probably sit both down and say "Final round. We have spoken to KDDI. Put in your best bid and we will support/recommend. No crying at the casino."</li>
</ul>


In what is rapidly becoming tedious, EQT+DG have raised their bid on Kakaku.com by 3.48% to thwart Bain's bid, which is now just 1.96% above EQT's bid. 
If Bain wants to "win", it has to come over the top. They can raise by ¥2/share and that refreshes everything but that would just allow EQT to raise ¥2/share.
Kakaku.com should probably sit both down and say "Final round. We have spoken to KDDI. Put in your best bid and we will support/recommend. No crying at the casino."


[Japan M&A] EQT+DG Up Kakaku.com (2371 JP) Bid by 3.478261% to ¥3570; Bain Needs To Bump, Again

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  Ongoing Focus on Rising Yields As Equities fall(again); US10Yr hits 4.19% as US Gov ramps up borrowing; China continues to shore up Economy; Resilient Apple, Amazon Earnings. </li>
<li>JAPAN. Nikkei Futures -0.5% vs Cash; USDJPY 142.5; BOJ Emergency Bond Buying to slow rapid yield rise; Nikkei sheds 1200 points in 2 days in risk off - still+23%YTD. </li>
<li>NUGGET.  Another sign that Japanese investors are not standing still as domestic inflation takes hold - Record purchases of high-yielding (+high risk!) currencies in the first half of the year.  </li>
</ul>


OVERSEAS.  Ongoing Focus on Rising Yields As Equities fall(again); US10Yr hits 4.19% as US Gov ramps up borrowing; China continues to shore up Economy; Resilient Apple, Amazon Earnings. 
JAPAN. Nikkei Futures -0.5% vs Cash; USDJPY 142.5; BOJ Emergency Bond Buying to slow rapid yield rise; Nikkei sheds 1200 points in 2 days in risk off - still+23%YTD. 
NUGGET.  Another sign that Japanese investors are not standing still as domestic inflation takes hold - Record purchases of high-yielding (+high risk!) currencies in the first half of the year.  


Ohayo Japan| Reality Check from Higher Yields; NUGGET: Yield Game - Japanese Investors on the Hunt

China/Asia TMT

Shawn Yang

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

<ul>
<li>We anticipate that the major swing factor of global e-commerce platform is the global expansion of Chinese e-commerce companies, including Shein, Temu, AliExpress, and TikTok Shop (or ‘STAT’).</li>
<li>The Japanese market is a good example. We upgraded Mercari to BUY because we believe that its second-hand eCommerce model addresses the issue of product supply.</li>
<li>We downgraded Z-Holdings to SELL as its B2C model lacks an advantage in product supply and has already lost market share.</li>
</ul>


We anticipate that the major swing factor of global e-commerce platform is the global expansion of Chinese e-commerce companies, including Shein, Temu, AliExpress, and TikTok Shop (or ‘STAT’).
The Japanese market is a good example. We upgraded Mercari to BUY because we believe that its second-hand eCommerce model addresses the issue of product supply.
We downgraded Z-Holdings to SELL as its B2C model lacks an advantage in product supply and has already lost market share.


[Blue Lotus Japanese E-Commerce Sector Update]: Facing the Competition from Chinese ECommerce STAT

<ul>
<li>OVERSEAS. Nasdaq and SOX Plunged overnight; Nasdaq on Tesla, Neflix; SOX on TSMC Sentiment;   Has something broken?  US Leading Index saying recession near; China deflationary pressures; Russia escalates war</li>
<li>JAPAN. NKY Futures -0.5% disc vs Cash; USDJPY 140.1;  Eyes on BOJ  but indications are no tweak;  Nidec turns it around - strong 1Q; Raft of BUY calls from Street. </li>
<li>NUGGET. Japanese companies are hiring IR professionals as they face greater scrutiny from shareholders, the TSE, and regulators. Positive development that we see as an offshoot of the governance code.</li>
</ul>


OVERSEAS. Nasdaq and SOX Plunged overnight; Nasdaq on Tesla, Neflix; SOX on TSMC Sentiment;   Has something broken?  US Leading Index saying recession near; China deflationary pressures; Russia escalates war
JAPAN. NKY Futures -0.5% disc vs Cash; USDJPY 140.1;  Eyes on BOJ  but indications are no tweak;  Nidec turns it around - strong 1Q; Raft of BUY calls from Street. 
NUGGET. Japanese companies are hiring IR professionals as they face greater scrutiny from shareholders, the TSE, and regulators. Positive development that we see as an offshoot of the governance code.


Ohayo Japan|Nasdaq, SOX Plunge-Did Something Finally Break?; NUGGET: In Demand in Japan - IR Talent

Japan

LY Corporation operates as an internet search engine "Yahoo! JAPAN". The Company provides electronic commerce and settlement finance services for small medium enterprises and individuals. LY also operates media business including search linked advertising and display advertising services.

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LY (4689 JP)

Kakaku.com (2371 JP): EQT/DG Again Outbids Bain/LY

Oasis has no intention of accepting EQT/DG’s revised offer of JPY3,570 as long as it remains below Bain/LY’s JPY3,640 offer (KDDI exiting via a...

Arun George

[Japan M&A] EQT+DG Up Kakaku.com (2371 JP) Bid by 3.478261% to ¥3570; Bain Needs To Bump, Again

Oasis with 19.5% has put out a press release this morning asking Kakaku.com to withdraw support for the EQT/Kamgras bid or to ask Bain to come out...

Travis Lundy

Ohayo Japan| Reality Check from Higher Yields; NUGGET: Yield Game - Japanese Investors on the Hunt

US Yields higher; SPX500 falls again; Apple, Amazon beat; Nikkei Futures -0.5% vs Cash; USDJPY 142.5; BOJ Emergency Bond Buying to slow rapid yield...

Mark Chadwick

[Blue Lotus Japanese E-Commerce Sector Update]: Facing the Competition from Chinese ECommerce STAT

We anticipate that the major swing factor of global e-commerce platform is the global expansion of Chinese e-commerce companies, including Shein,...

Blue Lotus Research Institute

Ohayo Japan|Nasdaq, SOX Plunge-Did Something Finally Break?; NUGGET: In Demand in Japan - IR Talent

US tech sell off; Has something broken ? NKY Futures -0.5% disc vs Cash; USDJPY 140.1; Eyes on BOJ but indications are no tweak; Nidec turns it...

Mark Chadwick

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