HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

Zhuhai Holdings Investment / Equity Bottom-Up

Our Zhuhai visit to property projects by <a href="https://www.smartkarma.com/entities/country-garden-holdings-co" target="_blank" data-smartkarma-citation="entities:5225:1" rel="noopener">Country Garden Holdings Co (2007 HK)</a> and <a href="https://www.smartkarma.com/entities/shimao-property-holdings-limited" target="_blank" data-smartkarma-citation="entities:8375:1" rel="noopener">Shimao Property Holdings (813 HK)</a> last weekend revealed the encouraging prospects of the city as a major player in the development of the Guangdong-Hong Kong-Macau Greater Bay Area. Improving infrastructure, competitive property price, convenient transportation and enriching leisure and entertainment facilities are key attractiveness of the city.We listed out some of the key companies in the city including <a href="https://www.smartkarma.com/entities/gree-electric-appliances-inc-of-zhuhai" target="_blank" data-smartkarma-citation="entities:7622:1" rel="noopener">Gree Electric Appliances (000651 CH)</a>, <a href="https://www.smartkarma.com/entities/huafa-industrial-co-ltd-zhuhai" target="_blank" data-smartkarma-citation="entities:2329:1" rel="noopener">Huafa Industrial Co., Ltd. Zhuhai (600325 CH)</a>, <a href="https://www.smartkarma.com/entities/zhuhai-port-co-ltd-a" target="_blank" data-smartkarma-citation="entities:15664:1" rel="noopener">Zhuhai Port Co Ltd A (000507 CH)</a> and <a href="https://www.smartkarma.com/entities/zhuhai-holdings-investment-group-ltd" target="_blank" data-smartkarma-citation="entities:17863:1" rel="noopener">Zhuhai Holdings Investment (908 HK)</a> as options for gaining exposure to the city. Along with our visit, we also observed a likely improvement in Zhuhai-Macau tourist traffic and this should be positive to <a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China Ltd (1928 HK)</a>.

Our Zhuhai visit to property projects by Country Garden Holdings Co (2007 HK) and Shimao Property Holdings (813 HK) last weekend revealed the encouraging prospects of the city as a major player in the development of the Guangdong-Hong Kong-Macau Greater Bay Area. Improving infrastructure, competitive property price, convenient transportation and enriching leisure and entertainment facilities are key attractiveness of the city.We listed out some of the key companies in the city including Gree Electric Appliances (000651 CH), Huafa Industrial Co., Ltd. Zhuhai (600325 CH), Zhuhai Port Co Ltd A (000507 CH) and Zhuhai Holdings Investment (908 HK) as options for gaining exposure to the city. Along with our visit, we also observed a likely improvement in Zhuhai-Macau tourist traffic and this should be positive to Sands China Ltd (1928 HK). 

China on the Ground: Visit to Zhuhai - Exploring Investment Ideas in the Greater Bay Area

Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

Around a month ago, Chinese port-operator <a href="https://www.smartkarma.com/entities/zhuhai-port-co-ltd-a" target="_blank" data-smartkarma-citation="entities:15664:1" rel="noopener">Zhuhai Port Co Ltd A (000507 CH)</a> launched a <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0729/2020072901180.pdf" target="_blank" rel="noopener">Voluntary Conditional General Cash Offer</a> to acquire Singapore-headquartered local peer <a href="https://www.smartkarma.com/entities/xinghua-port-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26750:1" rel="noopener">Xinghua Port Holdings (1990 HK)</a> in a Deal that valued the company at a market cap of HK$2.1bn (~US$270mn). Today, the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0826/2020082600021.pdf" target="_blank" rel="noopener">composite document</a> for the Deal was released. The Transaction is subject to only a minimum acceptance condition where the Acquirer has to reach a shareholding of at least 90% in the Target Company. The Offer price will be HK$2.597/share in cash and the transaction is expected to close before mid-October 2020. Xinhua's shares are currently at HK$2.54. In this Insight, we take a closer look at the details of the transaction to evaluate the likelihood of deal completion. As always, there is more below the fold. <hr>For more information about M&amp;A rules, regulations, and practices in Hong Kong, please refer to <a href="https://www.smartkarma.com/insights/quiddity-hong-kong-m-a-guide-2019" target="_blank" data-smartkarma-citation="insights:29174" rel="noopener">Quiddity Hong Kong M&amp;A Guide 2019</a>

Around a month ago, Chinese port-operator Zhuhai Port Co Ltd A (000507 CH) launched a Voluntary Conditional General Cash Offer to acquire Singapore-headquartered local peer Xinghua Port Holdings (1990 HK) in a Deal that valued the company at a market cap of HK$2.1bn (~US$270mn). Today, the composite document for the Deal was released. The Transaction is subject to only a minimum acceptance condition where the Acquirer has to reach a shareholding of at least 90% in the Target Company. The Offer price will be HK$2.597/share in cash and the transaction is expected to close before mid-October 2020. Xinhua's shares are currently at HK$2.54. In this Insight, we take a closer look at the details of the transaction to evaluate the likelihood of deal completion. As always, there is more below the fold. For more information about M&amp;A rules, regulations, and practices in Hong Kong, please refer to Quiddity Hong Kong M&amp;A Guide 2019 

Xinghua Port (1990 HK): Cash Offer Trading with a View to Complete

China

Zhuhai Port Co., Ltd. Zhuhai S.E.Z. is an investment holding company.  Through its subsidiaries, the Company develops real estate, provides port transportation services, manufactures pharmaceuticals, and operates in import and export trading.

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Zhuhai Port Co Ltd A (000507 CH)

China on the Ground: Visit to Zhuhai - Exploring Investment Ideas in the Greater Bay Area

Our visit to property projects of Country Garden and Shimao in Zhuhai revealed the city's prospects as a key player in the Greater Bay Area. We...

Osbert Tang, CFA

Xinghua Port (1990 HK): Cash Offer Trading with a View to Complete

Around a month ago, Chinese port-operator Zhuhai Port Co Ltd A (000507 CH) launched a Voluntary Conditional General Cash Offer to acquire...

Janaghan Jeyakumar, CFA

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