This weekly newsletter pulls together summaries of the top ten most-read Insights across Event-Driven and Index Rebalance on Smartkarma.
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1. [Japan M&A/Activism] Toyota RE Says No Bump for Toyota Inds (6201) Part III – Elliott Makes Its Case
- This morning, Elliott made its case to interested investors, explaining much of its presentation and the possible choices investors face. TF’s average buy price is <¥18,000. Q3 BVPS likely ¥20k+.
- But of course, realtime BVPS is higher, and transaction structure BVPS comes out near ¥24k. This is too cheap. Still.
- Post-Close today, BidCo said “[The TOB Price] is the best possible price that reflects the intrinsic value of [TICO]”. That tells me and many others, Bidco isn’t the right buyer.
2. Toyota Industries (6201 JP): Who Wins This Game of Chicken?
- Toyota Industries (6201 JP)’s 3Q results further emphasise that Toyota Fudosan’s JPY18,800 offer is light. The offer implies a P/B ratio of 0.93x based on the 3Q book value.
- Fudosan’s assertion that it will not change the offer price is not credible. Elliott is likely to further increase its stake but is unlikely have its price expectations met.
- Fudosan’s likely gameplan is to bump above 3Q book value (JPY21,300 to bring the P/B back to the pre-3Q ratio of 1.05x) and possibly also lower the minimum.
3. [Japan Activism] Fuji Media (4676) Offers Activists a Possible Juicy Way Out
- Fuji Media Holdings (4676 JP) ran into a scandal a year ago. It was scandalous before but it all got ugly a year ago. I discussed last year here.
- Last June, activist Dalton tried to spill the Board. It did not work. Incumbents and recommended got 81-86% support. Dalton’s slate got 10-27%. No joy.
- Activists are in big. Murakami at 17%. Dalton at 7+%. Last week, the Nikkei reported Dalton would push for a 10% of TSO buyback. Today, we got a bigger one.
4. Montage Technology (6809 HK): US$1bn Offering at a Near 50% Discount to A-Shares
- Montage Technology (688008 CH) could raise up to HK$8.1bn (US$1.04bn) in its Montage Technology (6809 HK) listing if the Overallotment Option is exercised.
- Nearly half the base offering is allocated to cornerstone investors; those shares are locked up for 6 months. That eliminates the already small possibility of early inclusion to global indexes.
- Montage Technology (6809 HK) should be added to Southbound Stock Connect from the open of trading on 9 March following the end of the Price Stabilisation period.
5. Guoco (53 HK): Now Even A Deeper Value Play
- After GuocoLand (GUOL SP)‘s Offer for Guocoland Malaysia (GUOL MK), it seemed appropriate to revisit Guoco Group (53 HK). Just as well – it is totally bombed out.
- I see Guoco’s implied stub – net of GuocoLand, Hong Leong Financial (HLFG MK), Bank of East Asia (23 HK), and Rank Group (RNK LN) – at a decade low.
- It’s coming up to eight years since the Quek family reloaded an Offer for Guoco. Which subsequently failed. Time for the family to step up. Again.
6. [Japan CorpGov] TSE “Mgmt Conscious” Reports (Feb26) – Disappointing Case Studies, Weak Study Group
- TSE-Listed companies are asked to file “Management Conscious of Capital Cost/Stock Price” awareness reports/policies. Many have. Some are still working on it. And policies change, and CGR reports are updated.
- There were case study updates published late-Dec25. Interesting, but not ground-breaking. 146 CGRs were filed in January after 475 in December 2025. It’s low season til spring.
- The ongoing Study Group to review Minority Shareholder Protection, etc has interim comments suggesting Toyota Fudosan’s claim of Majority of Minority is false (of course it is, but they’re nicer).
7. Makino Milling Machine (6135 JP): Twin Headwinds as Chinese and US Approvals Secured
- Makino Milling Machine Co (6135 JP) has announced that MBK has secured the two highest risk approvals (US CFIUS and China SAMR).
- The remaining approval (Japan) should be obtained by mid-February. However, the offer must now contend with twin headwinds of a bull market and upgraded guidance.
- While MBK’s improving deal economics support a bump, several mitigating factors (such as deal fatigue and no competing bid) suggest a low probability of a bump.
8. MCJ (6670 JP): Bain-Sponsored MBO at JPY2,200
- MCJ Co Ltd (6670 JP) has recommended a Bain-sponsored MBO at JPY2,200, a 43.0% premium to the last close.
- Mr Yuji Takashima (Chairman and CEO) will reinvest to take a 33.1% stake. The offer represents an all-time high and aligns with the midpoint of the IFA DCF valuation range.
- However, the sale process was lacking (no auction) and is light compared to peer multiples. Barring the emergence of an activist, this is a done deal.
9. Same Product, Two Different Prices – The GOLD’en Opportunity
- The price gap between gold on the US Comex and in Shanghai has widened and is significantly larger than normal.
- Price divergence is due to paper vs. physical – the US is mainly driven by futures and paper trading, while Shanghai is real physical supply and demand.
- Arbitrage is not possible due to logistical and regulatory barriers. The gap will have to narrow, with paper gold heading higher to match the physical price!
10. CKH (1 HK): The Courts (Predictably) Annul The Panama Concessions. Now What?
- It was a sure bet Panama’s highest court would annul CK Hutchison Holdings (1 HK)‘s Panama Ports Company (PPC) port contracts. Less clear are the next steps.
- The Panamanian government has tapped AP Moeller – Maersk A/S (MAERSKB DC)‘s APM Terminals as the temporary administrator – or “neutral stabiliser” – via a phased handover of the ports.
- PPC has already indicated it will seek a “clarification” of the ruling. And CKH can still sue the Republic of Panama in international tribunals.
