Australia

• Ki Corporation and Public Storage (PSA US) together announced a NBIO, by way of a Scheme, to acquire all of the outstanding securities of Abacus Storage (ASK AU) not held.
• The indicative offer of A$1.47/stapled security is a 26.7% premium to undisturbed and ~8% discount to the latest NTA/security. Nathan Kirsh directly/indirectly holds a 59.47% stake in ASK.
• Trading at a gross/annualised spread of 6.9%/10.9%, assuming late Nov completion. That’s tight given timing risk, and terms not being firm.

• On 7 April, Abacus Storage King (ASK AU) disclosed a non-binding proposal from Ki Corporation and Public Storage (PSA US) at A$1.47, a 26.7% premium to the undisturbed price.
• While below NTA (implying a P/NTA of 0.92x), the offer is reasonable compared to peer multiples and historical trading ranges. It represents an all-time high. 
• A binding offer is conditional on due diligence (expected to take six weeks) and Board recommendation. The Board should work to secure a binding offer closer to NTA.   

• Travis Lundy succinctly summarised the Trump Tariffs in Trump Team’s Weird Tariff Math – Not Meant to Be Negotiated. Do read his note.
• From an arb standpoint, most (all?) NBIOs will likely see a downward revision in pricing. Vote risk should also be reduced.
• Such tariffs on predominantly domestic businesses should not trigger material adverse changes (MACs) Down Under. But it is still a worthwhile project to dig a little deeper.  

• SGX Iron Ore Futures fell $2.78/ton WoW, closing at $99.45/ton on April 4 after breaching key support levels and trading in a wider $5.95/ton range.
• U.S.–China tariff escalation led to a MACD-confirmed downtrend and prices plunging below 100- and 200-day DMAs, signaling heightened bearish momentum.
• Despite sharp price drops, implied volatility declined across all deltas reaching new lows for the year, with skew falling to +0.5%. 

• Given its portfolio mix, Treasury Wine Estates (TWE AU) does not expect a material impact on its business from the blanket 10% tariff on all goods imported from Australia/New Zealand.
• However, there is a high probability that Treasury Wine Estates (TWE AU) will be deleted from a global index in May and that will lead to large selling from passives.
• There has been an increase in short interest and an increase in other positioning. Trading will be volatile but there could be a downward bias over the next few weeks.

• Abacus Storage King (ASK AU) was demerged from Abacus Property Group in 2023 and the stock has traded in a range since listing.
• Now, Ki Corp and Public Storage (PSA US) have made a conditional and non-binding proposal to take Abacus Storage King (ASK AU) private at A$1.47/share.
• The offer is a 27% premium to the last close of the stock and is higher than the price that the stock has traded at since listing.

• Executive Chairman John Welborn presented the investment case for Fenix Resources (FEX AU) at the Ignite Investment Summit in Hong Kong on March 26th/27th.  
• The company’s imminent production of 4 million tons of iron ore (~$100 USD/ton), is projected to generate AUD 200 million in operating cash flow, matching its current market capitalization.
• The company briefly touched on its M&A opportunity with Coziron Resources (CZR AU), which is expected to add 40 million tons of reserves and further increase production. 

• The Dropsuite Ltd (DSE AU) IE considers NinjaOne’s A$5.90 offer fair and reasonable as it is above its A$3.92-5.88 valuation range.
• The offer is conditional on shareholder and FIRB approval. Despite the largest shareholder’s selldown, the vote remains low-risk.  
• The offer is attractive and represents an all-time high. At the last close and for a 30 May payment, the gross/annualised spread is 1.7%/11.5%.  

• On the 28th January 2025, Dropsuite Ltd (DSE AU), a backup, recovery and protection software company, entered into a Scheme Implementation Deed with Texas-based IT automation outfit NinjaOne.
• NinjaOne’s A$5.90/share Offer was a 34.1% premium to undisturbed. The Offer had the backing of Dropsuite’s largest shareholder, Topline Capital (31% – at the time!). Board/management held a further 9%.
• The Scheme Booklet is now out, with a Court Meeting on the 9th May, and expected payment on or before the 30th May. The IE (BDO) says “fair & reasonable“.

• Market Reaction: The announcement of US reciprocal tariffs led to significant declines in S&P 500 (-3.5%) and Nasdaq-100 (-4.4%) futures, with the VIX spiking from 20.00 to 23.45.
• Impact on Australia: Australia faces a 10% tariff, with the overall economic impact expected to be limited.
• S&P/ASX 200 (AS51 INDEX) Response: The S&P/ASX 200 dropped 2.1% in early trading, with its VIX index rising from 13.20 to 15.43. These are historically high but not extreme levels.

• Northern Star Resources (NST AU)‘s acquisition of De Grey Mining (DEG AU) is expected to complete in the next 3 weeks.
• There will be an ad hoc inclusion to the S&P/ASX 200 (AS51 INDEX) and passive buying in Northern Star Resources (NST AU) from a bunch of trackers of different indices.
• The acquisition brings Northern Star Resources (NST AU) close to inclusion in the S&P/ASX 20 Index, but it’s not there yet.

• The AVID consortium’s late-November A$0.67/share NBIO appeared a lock; until Ho Bee Land Ltd (HOBEE SP) lobbed a A$0.70/share NBIO in January. Ho Bee also acquired a 5.39% stake. 
• AVJennings (AVJ AU) granted both suitors exclusive due diligence, the terms of which expired in February. AVJ said at the time it remained in “active discussions” with both.
• AVJ and AVID have now entered into a Scheme Implementation Deed at A$0.655/share. A special dividend – included in the Scheme consideration – could add A$0.072/share in franking credits. 

• Avjennings Ltd (AVJ AU) entered a scheme implementation deed with AVID at A$0.655, 2.2% below its previous A$0.67 offer and a 98.5% premium to the undisturbed price. 
• The key conditions are shareholder and regulatory approvals (FIRB and OIO). The vote is low-risk as SC Global (54.02% of outstanding shares) will vote in favour. 
• Despite the marginally lower price, the offer is attractive, as evidenced by the hefty takeover premium. This is a done deal, with the scheme meeting expected in mid-June.

• According to Graph 1, during the period February 4th, 2025 – March 4th, 2025, a slightly bearish trend, among strong fluctuations, was reflected in the price of aluminium futures.
• At the beginning of the timeframe, there was a significant increase in the price of the commodity, but after February 20th a steady downward momentum unfolded.
• The MA-10 line very initially performed above the MA-20 line, however at February 6th it crossed below the latter. 

Barton has continued to aggressively pursue its ambition to produce 125–150koz gold pa at Tunkillia via open pit production, completing a 5,064m reverse circulation drilling campaign targeting block model extensions, updating JORC mineral resources to 1.6Moz gold and 3.1Moz silver and identifying material available energy savings. At Tarcoola, it has discovered the new Tolmer gold system, added further pit floor gold mineralisation at the Perseverance mine, and made a surprise high-grade silver discovery alongside Tolmer’s gold – the best interval of 6m at 4,747g/t (152.6opt) Ag being exceptionally high by anyone’s standards. These will all contribute to an optimised scoping study at Tunkillia in Q2 CY25 and (from Tarcoola) feedstock for ’Stage 1’ operations, leveraging its fully licensed Central Gawler mill to 20–30koz pa as early as mid-CY26. Topping it off, Barton announced a A$3.1m net profit for the half year to 31 December, an unusual and impressive feat for a junior.

Barton has continued to aggressively pursue its ambition to produce 125–150koz gold pa at Tunkillia via open pit production, completing a 5,064m reverse circulation drilling campaign targeting block model extensions, updating JORC mineral resources to 1.6Moz gold and 3.1Moz silver and identifying material available energy savings. At Tarcoola, it has discovered the new Tolmer gold system, added further pit floor gold mineralisation at the Perseverance mine, and made a surprise high-grade silver discovery alongside Tolmer’s gold – the best interval of 6m at 4,747g/t (152.6opt) Ag being exceptionally high by anyone’s standards. These will all contribute to an optimised scoping study at Tunkillia in Q2 CY25 and (from Tarcoola) feedstock for ’Stage 1’ operations, leveraging its fully licensed Central Gawler mill to 20–30koz pa as early as mid-CY26. Topping it off, Barton announced a A$3.1m net profit for the half year to 31 December, an unusual and impressive feat for a junior.

• SGX IO Futures rose $2.25/ton over the week, closing at $102.25/ton, buoyed by seasonal steel demand and technical support above 9D and 21D DMAs.
• Implied volatility in iron ore options fell sharply YoY (ATM IV -36%, 10-delta puts -41%), making long volatility positions more affordable.
• Futures and options open interest rose 6.85% WoW, with Financial Institutions increasing net long positions, reinforcing bullish positioning.

• Reject Shop (TRS AU), a discount variety store, has entered into a Scheme Implementation Deed with Canadian outfit Dollarama (DOL CN).
• Dollarama is offering A$6.68/share, a 112% premium to last close. The Offer does NOT require FIRB signing off. The Offer has the unanimous backing of both boards.
• The Offer also has the backing of TRS’ largest shareholder, Kin Group (20.8%).  Implementation is expected July 2025. This is done.

Recce is preparing to start a registrational Indonesian Phase III study of the topical gel formulation (R327G) of its lead anti-infective therapeutic drug candidate, RECCE 327 (R327), for the treatment of diabetic foot infections (DFIs). We expect the trial to start in the coming weeks and note that DFIs are the leading cause of limb morbidity in diabetic patients and an area of unmet need as currently available topical drugs have limited effectiveness. We anticipate that positive results could lead to Recce’s earliest R327 commercialisation opportunity, through a launch in South-East Asia in the DFI indication in H2 CY26. After adjusting for forex and other minor adjustments, we now obtain an rNPV valuation of A$610.1m (or A$2.68 per share), versus A$593.6m (or A$2.60 per share) previously.

• In this insight, we take a look at the potential index changes for ASX 200, 100, 50, and 20 in the run-up to the June 2025 index rebal event.
• We expect one change for ASX 50, one change for ASX 100, and two changes for ASX 200. 
• The official index changes will be announced after the close on Friday 6th June 2025.

• Domain Holdings Australia (DHG AU) announced a final non-binding proposal from Costar Group (CSGP US) at A$4.43, a 5.5% premium to the previous A$4.20 offer.
• The scheme vote is low-risk as Nine Entertainment Co Holdings (NEC AU) seems supportive. Nine suggested that the revised price would result in after-tax cash proceeds of A$1.4 billion.
• While attractive to precedent transaction multiples, the revised offer remains light compared to peer multiples. Nevertheless, expect a binding proposal to be forthcoming. 

• Verbrec Limited (ASX:VBC) provides engineering, asset management, infrastructure services and training to the energy, mining, infrastructure and defence industries in Australia, New Zealand, PNG and the Pacific Islands.
• The company has announced that its wholly-owned subsidiary StacksOn Operations Pty Ltd has entered into a Software Reseller Agreement with Datamine for Verbrec’s stockpile digital twin product StacksOn.
• The product was developed in-house by Verbrec and commercialised in 2021 and is currently utilised by BHP at its iron ore mines and ports in Western Australia.