Australia

• Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.
• Highlights: Currently nine pair trade opportunities across four markets and six sectors persist.
• Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.

• There were further updates on the Simandou iron ore mine, which commenced operations last week, igniting bearish sentiment and taking iron ore prices down 3% WoW to 103 USD/ton.
• Demand, though, for higher-grade material remains strong, resulting in a widening spread between 65 and 62 Fe to almost 16 USD/ton (from 12-13 USD/ton a week ago). 
• We favor Fenix Resources (FEX AU) for its high growth profile and potential to increase production from 1.5 million tons to around 10 million tons. 

• Interview by RaaS Senior Analyst Graeme Carson with Verbrec CEO Mark Read following the Alliance Automation acquisition.

• Verbrec Limited (ASX: VBC) provides engineering, asset management, operations and maintenance, and training to the energy, mining, infrastructure and defence industries in Australia, New Zealand, PNG and the Pacific Islands.
• The company announced it has acquired Alliance Automation (Alliance), increasing the group’s automation, control, digital industry, machine learning and cyber security capability and expanding its client base.
• The consideration of $5.5m, on a trailing FY25 EBITDA multiple of 5.0x and an adjusted EBITDA multiple of 2.7x, appear to be very favourable and highly accretive acquisition terms, particularly given the FY25 revenue base of the business was $62.5m.

• The ADDs/DELs for the ASX index family for the December 2025 index rebal event were announced after market close on Friday 5th December 2025. 
• There are 20 ADDs and 20 DELs collectively for ASX 50, ASX 100, and ASX 200.  We got 19/20 predictions correct.
• In this insight, we take a look at our final flow expectations for each of these confirmed index changes.

• First, EQT, then CVC joined, in a A$45/share NBIO for AUB (AUB AU), an insurance “matchmaker”: CVC Joins EQT In Pursuit Of AUB Group (AUB AU). Talks ceased this week. 
• Reportedly, AUB’s larger insurance rival, Steadfast (SDF AU), is now attracting PE interest, such as Blackstone.
• Steadfast is down ~25% from its recent high following a workplace complaint towards CEO/MD/founder Robert Kelly – now concluded on “a confidential basis”, with Kelly resuming his roles. 

• Very quiet trading this week with a weekly closing range near the lows for the year.
• Breadth deteriorated from last week’s elevated readings as the market tries to push higher. 
• Quiet earnings calendar with only six companies issuing earnings reports in the coming week.

• Aspen Group (APZ AU) will be added to a global sector index at the close 19 December. The stock is also a potential inclusion to a global index in March.
• Estimated passive buying in Aspen Group (APZ AU) is U$21m and positioning in the stock could continue to build in the next few days.
• Positioning in the stock has been increasing over the last few months with a jump that started at the beginning of November.

• Context: The GPT Group (GPT AU) vs. Stockland (SGP AU) price-ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.
• Highlights: Going long Stockland (SGP AU) and short The GPT Group (GPT AU) targets a 4% return, with Stockland (SGP AU) supported by a lower P/E multiple.
• Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.

• CleanSpace Holdings Ltd (ASX:CSX) is a designer and manufacturer of respiratory protection equipment and consumables for powered air purifying respirators (PAPRs).
• CSX has provided a trading update at their AGM which guides to lower H1 FY26 revenue growth relative to previous halves and RaaS estimates (+27%), impacted by trade and tariff tensions not dis-similar to trends seen for several advanced Australian manufacturers including Veem (ASX:VEE) and Austin Engineering (ASX:ANG), and the dismantling of key US safety regulator NIOSH.
• Gross margins remain in-line with estimates around the ‘mid-70s’ and costs are well controlled.

• AFL is executing a roll-up strategy in the highly fragmented Australian family law market, driving strong revenue growth through acquisitions.
• Significant profitability challenges persist, evidenced by a statutory net loss in 2023 and razor-thin margins in 2025, raising concerns about the sustainability of its acquisition-led model.
• The company’s valuation appears stretched, with a P/E ratio of 100, which seems disconnected from its volatile earnings and the inherent risks of integrating numerous small law practices.

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• Collins Foods produced record interim results in a difficult environment, prompting management to issue a ‘conservative’ upgrade to FY26 guidance.
• Collins Foods delivers record interim revenue Margin ‘beats’ in Australia & Europe Market disappointed by management’s rather conservative FY26 profit upgrade UBS highlights outperformance of KFC Australia relative to peers

• Predictive Discovery (PDI AU) has disclosed a competing all-scrip scheme offer from Perseus Mining (PRU AU) at 0.136 Perseus shares per PDI share.
• The Perseus offer is attractive compared to peer resource multiples and historical trading ranges. The Board had deemed the proposal superior to the Robex Resources (RBX CN) merger transaction.
• Robex has five business days to exercise matching rights. Robex will struggle to match due to the large gap in the offer values. 

• Blue Gold Limited (BGL) has set out to create and distribute the world’s first global gold-backed digital currency, the Standard Gold Coin (SGC).
• Launch is planned for Q1 2026.
• The company intends to support the SGC with its own digital wallet (the One App), with launch planned for Q3 2026.

• Airtasker Limited (ASX:ART) is an online marketplace for local services, connecting people and businesses who need work done with people who want to work.
• ART held an investor day last week showcasing a range of senior management and media capital partners.
• Product development continues to focus on improving marketplace trust (improved tasker details and job descriptions), increased frequency of transactions (better/fewer quotes, taskers own page) and using AI for better/faster job matches.

• On the 6th October, West African mid-tier gold play Predictive Discovery (PDI AU) announced scrip-merger with Robex Resources (RBX CN/RBX AU). Upon completion, PDI would hold 51% of shares out.
• Immediately, rumours circled in local media that Perseus Mining (PRU AU), PDI’s largest shareholder (17.8%), was poised to launch its own offer. That has now unfolded. 
• Perseus is offering 0.1360 new Perseus share for every PDI share, or an indicative consideration of A$0.778/share. PDI deemed terms superior. Robex has matching rights under its definitive agreement.

• ReadCloud Limited (ASX:RCL) services the education and training sectors through the provision of digital learning content, proprietary interactive technology and support for students and educators.
• The company released its FY25 full-year result (30 September year-end) but many of the data points had been pre-released so there were no real surprises.
• The core strategic Australian schools-facing businesses in eBooks and VET-in-Schools (collectively 85% of FY25 group sales revenue) delivered strong results, with VET-in-Schools the standout growing revenue at 26% to $5.7m and continuing to deliver gross margins exceeding 90%.

• ADX has increased its aggregated prospective gas resource estimates for its Sicily Channel permit from 103–369–772 bcf to 188–484–1,265 bcf (P90–P50–P10 cases).
• The new mean prospective resource of 619 bcf reflects the increased upside potential for the permit.
• Individual prospect sizes range between 37–111 bcf (P50 case), with four prospects each estimated at 60–68 bcf (P50).

• The gold rush continues with another Canadian outfit bidding to take over an Aussie-listed West African gold play. 
• Junior miner African Gold (A1G AU)has entered into a Scheme with Montage Gold (MAU CN). African Gold shareholders will receive 0.0628 new MAU shares for every A1G share.
• That backs out an implied value of A$0.50/share. Independent directors, holding 11.6% of shares out, are supportive. Montage holds 17.3%. Clean deal.

• The speaker discusses their interest in an intriguing South Australian undeveloped copper stock called Havilah (HAV)
• The speaker shares their initial encounter with the company in 2022 and their impression of its potential value and optionality of assets

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• QGold’s hostile takeover offer for Venus Metals at A$0.17/share is expected to increase, with VMS stock trading at A$0.195/share.
• VMC’s assets in Rox Resources are valued at A$46m, with a 1% net smelter royalty potentially undervalued due to outdated assumptions.
• Christopher Wallin’s QGold has acquired a 26% stake in VMC and a 9% stake in Rox Resources, indicating strategic interest.

• Macro crew discussed a benign outlook on carry fairly risk on climate for the first half of the year
• FX vols expected to be fairly contained in 2026 due to factors like US growth and central bank activity
• Themes for positioning in 2026 include bullish European growth, antipodean FX, and bearish Yen outlook

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• I summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Canon Electronics (7739 JP), Smart Share Global (EM US), AUB Group Limited (AUB AU), Dongfeng Motor (489 HK), Low Keng Huat Singapore (LKH SP), Digital Holdings,
• Lowest spreads: Bright Smart Securities (1428 HK), Pacific Industrial (7250 JP), Toyota Industries (6201 JP), Seven West Media (SWM AU), Ainsworth Game Technology (AGI AU), Star Micronics (7718 JP).

• Wrkr Ltd (ASX:WRK) offers compliance solutions for Australian superannuation contributions and payroll including member onboarding, super payments, messaging and employee validation.
• WRK has delivered a record cash receipts quarter ($4.0m), +74% on the previous corresponding period (pcp) and +30% on Q4 FY25, aided by milestone payments and some overdue receipts from Q4 FY25 ($0.4m).
• Total costs increased 24% on Q4 FY25 as WRK prepares for client onboarding and continues product development.

• For November 2025, eight new transactions (firm and non-binding) were discussed on Smartkarma (by the Quiddity team) with an overall announced deal size of ~US$10bn.
• The average premium for the new transactions announced (or first discussed) in November was ~31%, with a year-to-date average of ~48%.
• The average premiums for transactions in 2024 (129 transactions), 2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31%.

• SPASX200 gained steadily through the week despite slowing daily momentum, nearly reversing last week’s decline
• Market breadth strengthened, with a broad rebound across optionable stocks.
• Implied vols declined across most single stocks, bringing the average back toward mid range levels after last week’s elevated readings

• This deal for Qube Holdings (QUB AU) from Macquarie should really get competitive. Scarce and strategic assets  – and nothing else like it that’s listed. 
• As Digital Holdings (2389 JP) goes higher, “This is Japan” risk increases; but those who didn’t sign up say “wait a minute, that’s real money” also goes up.
• Wynn Resorts (WYNN US) is at extreme levels vs. Wynn Macau Ltd (1128 HK); yet consensus indicates considerably higher forward EBITDA growth for Resorts stub ops vs. Macau.

• Fenix Resources is a rapidly growing, fully integrated iron ore producer in Western Australia, leveraging its wholly-owned logistics and port infrastructure to unlock stranded assets and maintain high margins.
• The company’s recent acquisition of a 30-year mining right at the Weld Range project is transformational, securing a 290 million tonne resource base that significantly extends mine life and provides a clear pathway to scale production beyond 4 million tonnes per annum.
• While the company trades at attractive valuation multiples and is poised for significant cash flow growth, its earnings are highly sensitive to the volatile global iron ore price, which remains the principal risk to the investment thesis.

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