Event-Driven

• Big Beautiful Skew was again a no-show. But the SFC’s expectation of dual counter eligibility for Connect by year-end approaches its endgame.
• The GAC (2238 HK) reco 2wks ago worked well. One extra week was bad. Last week’s reco on CNOOC Ltd (883 HK) was a disaster. H underperformed A by 8.4%.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• This week we had a busy week of earnings (WDC, AAF, LBTYA), and it will continue next week.
• Honeywell (HON)  spun off 100% of its Advanced Materials business, Solstice (SOLS), on October 30, 2025.

• Solstice was added to the S&P 500 and performed well on its first day of trading before selling off on Friday.

• GBL: discount 28.6% (Oct 31). Selling €1.7bn GBL Capital NAV for €1.5bn cash (+€0.4bn deferred); €0.6bn commitments transferred. Simpler, more liquid, greater buyback firepower—supports discount narrowing.
• Sweden: Industrivärden discount 5.8% (near lows). Investor AB resilient; NAV SEK 1,024bn, TSR +5%. Quality ballast, limited discount alpha now.
• Vivendi: 33.2% discount to €4.67 NAV; AMF-driven OPA path intact. Scenario-weighted value ~€4.17; prefer outright long or stub vs UMG/Banijay/MFE; trim if discount narrows to 10–15%.

• 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: Mayne Pharma (MYX AU), Brainpad Inc (3655 JP), Smart Share Global (EM US), AUB Group Limited (AUB AU), ENN Energy (2688 HK), Dongfeng Motor (489 HK).
• Lowest spreads: Bright Smart Securities (1428 HK), Mandom Corp (4917 JP), Pacific Industrial (7250 JP), Seven West Media (SWM AU), Humm Group (HUM AU), Toyota Industries (6201 JP). 

• In the days approaching H1 results in 2024, Japanese banks raised H1 guidance. Among the top 50 banks outside the top 10, the increase was significant. 
• This year, out of those 50 banks, 12 have either reported (2) or raised guidance (10) for H1 in the past five weeks by an average of 47% (median 43%). 
• Higher loan income, core business profits, and lower credit costs are the main culprits. Expect lots more guidance revisions in the next 10 days.

• The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
• Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. 
• However, such disclosures are by no means an absolute. These insights also flag those companies where shares have been pledged, both recently and ongoing.

• Pine Labs (0568874D IN) is looking to list on the exchanges by selling 176.5m shares via a primary and secondary offering to raise US$439m at a valuation of US$2.86bn.
• The price band has been set at INR 210-221/share and could price at the top end of the range. The IPO raise and valuation are sharply lower than earlier reports.
• Inclusion at regular rebalances will commence in May but flow will be small given the low float and the Smallcap indices that it is added to.

• For Oct 2025, 15 new transactions (firm and non-binding) were discussed on Smartkarma (by the Quiddity team) with an overall announced deal size of ~US$33bn.
• The average premium for the new transactions announced (or first discussed) in October was ~54%, with a year-to-date average of ~49%.
• 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%.

• Nidec (6594 JP)‘s deletion is a LOT of stock to sell. The Ibiden (4062 JP)‘s Nikkei 225 inclusion is huge. It’ll make the stock enormously squeezy for a long while.
• Palliser has a point. LG Chem (051910 KS) should pare down its LG Energy Solution (373220 KS) stake, and buy back shares. Yet, would/will management stubbornly swat away any such proposal?
• The latest twist in the Mayne Pharma (MYX AU) saga as FIRB looks set to ding the transaction if there is a possibility Cosette closes a manufacturing site in Adelaide.

• I tally 43 – mostly firm, mostly Asia-Pac – arb transactions currently being discussed and analysed on Smartkarma.
• Six new deal was discussed on Smartkarma this week: AUB  (AUB AU), ANE (9956 HK), SCSK (9719 JP), Brainpad (3655 JP), Sumitomo Riko (5191 JP), and Sumitomo Densetsu (1949 JP).
• Key updates/news also took place on: Humm Group (HUM AU), Oneconnect Financial Technology (6638 HK), Hang Seng Bank (11 HK), Ashimori Industry (3526 JP), Restaurant Brands NZ (RBD NZ). 

• POSCO has signed a strategic partnership with Cleveland-Cliffs. POSCO is likely to invest more than 1 trillion won to purchase at least a 10% stake in Cleveland-Cliffs by early 2026.
• Local media have mentioned that POSCO is likely to invest more than 1 trillion won (US700 million) to purchase at least a 10% stake in Cleveland-Cliffs by 2026.
• Overall, we believe that a potential US$700 million investment in Cleveland-Cliffs for about 10% stake in the company could have a positive impact on POSCO.

• KOFIA says Hynix hit 10.89% weight in October vs 8.37% in September, lifting the 10% fund cap — now local funds can size up like Samsung Electronics.
• SK Square might have been dumped today as locals unwound proxy trades; with Hynix freed from the 10% cap, funds rotated directly into Hynix, front‑running the shift.
• Key now is rotation size; SK Square’s beta‑plus trade to Hynix is fading, and near term we should expect relative underperformance as flows migrate.

• There is an end of a lock-up period for 55.3 million shares (33% of outstanding shares) for SK Innovation (096770 KS) starting 20 November 2025.
• This could potentially result in additional selling by insiders which could negatively impact its share price in the coming weeks.
• SK Innovation is currently trading at relatively high valuation multiples. We remain Bearish on SK Innovation.

• LG Chem is considering on paying higher dividends using sale proceeds from LG Energy Solution. 
• This breaks the company’s principle of using only ordinary income from operating activities as a source for dividends.
• If indeed LG Chem goes ahead with this plan, this would be as a result of heightened demands from major activist investors including Palliser Capital.

• SK D&D announced the results of the delisting tender offer by Hahn & Co. SK &D mentioned that the subscription reached only 40% of the planned tender offer amount.
• Post failed tender offer for SK D&D by Hahn & Co, we expect this to have a positive impact on SK D&D’s share price.
• The major reason for this is that there are still many investors that believe that SK D&D’s shares are significantly undervalued at P/B of only 0.4x.

• Sintana Energy is acquiring Challenger Energy at a 0.4705x exchange ratio, with a 15% actionable spread.
• Charlestown Capital Advisors orchestrates the merger, holding significant stakes in both companies and providing financial support.
• Merger approval requires 75% of Challenger votes, with 34% already committed, and regulatory approvals expected smoothly.

• Honeywell completed the spin-off of Solstice Advanced Materials Inc. on October 30, 2025.
• Both the parent and the spin-off commenced regular-way trading from October 30, 2025. On the first day of trading, parent lost 0.84%, while spin-off gained 0.29%.
• On an overall basis, HON (consolidated) gained 2.6% since the spin-off announcement on October 8, 2024, underperforming the S&P 500’s which gained 18.6% gain over the same period.

• CNMC approval with commitments de-risks the regulatory leg, shifting focus to shareholder acceptance and the Ministry’s decision; the spread has compressed but still offers short-dated, event-driven upside.
• Ercros’s weak H1 performance and cyclical trough distort multiples; the €3.505 offer equates to ~9x EBITDA today but nearer 6× on normalized levels, consistent with control transaction benchmarks.
• Base-Case IRR exceeds 100% annualized if settled by December; downside anchored by €2.56 break price, while any price bump toward €4.40 adds optionality without being part of the base case.

• DuPont will separate its Electronics unit as Qnity Electronics Inc. on Nov 1, 2025, creating two focused platforms – a high-growth semiconductor materials business and a steadier diverfied industrial company
• Qnity launches with ~$4.3B sales, ~29% margins, strong semiconductor exposure but higher leverage and cyclicality
• We value Qnity at $106/share (17.2× FY26E EBITDA) and DuPont (ex-Qnity) at $47.5/share (13.0× FY26E EBITDA).

• Yesterday after the close, Sumitomo Corp (8053 JP) announced it would buy out minorities in Scsk Corp (9719 JP) at ¥5,700/share.   
• As a “parent takes out subsidiary” deal, this was not unexpected at some point in time. The register looks like there may be a number of people who expected that.
• This gets done pretty easily. It is not a bad price. 

• Today with the earnings announcement, Sumitomo Electric Industries (5802 JP) announced it would buy out minorities in Sumitomo Riko Company (5191 JP), its rubber products subsidiary. 
• The price is low, and especially so when one considers the significant net receivables and inventory number (about 2mos of revenue, but one turn of annual EBITDA).
• Crossholders and insiders, however, own nearly 15% of the company, and that makes blocking this deal difficult, despite its low price, and lack of synergies considered in the price.

• Concurrent with the sale of 13 floors of OCB to Alibaba, Jardine Matheson (JM SP) announced on the 17th October an Offer for Mandarin Oriental (MAND SP)‘s minorities at US$3.35/share.
• This is a clean, full, “dull” Offer. And MAND is trading super tight to terms at ~2.1% gross, with possible payment (my estimate) late Feb 2026.
• Proceeds from the OCB sale will be US$925mn. And taking out MAND’s minorities will set Matheson back ~US$1bn. Yet the market is now assigning US$2.1bn less for Matheson’s stub ops. 

• Today partway through the day, Daiwa House Industry (1925 JP), Sumitomo Electric Industries (5802 JP), and Sumitomo Densetsu (1949 JP) announced Daiwa House would buy out Sumitomo Densetsu for ¥9,760/share. 
• Sumitomo Electric will sell its stake to the company ¥6,877/share. Minorities get 11.9x Mar26 EBITDA. The Bidder is buying at 9.9x. 
• At an ATH, and a nice premium, and 3x book, this looks like a pretty good takeout price. Daiwa House has plans for it.

• Hyosung Heavy (298040 KS) near 29% weight; 10ppt ceiling cut = ~0.6–0.7x DTV outflow. Unlike other ETF heavies, flows here bite — real tradeable setup.
• Hyosung Heavy ceiling cut hits Dec 12 rebalance unless >30% earlier; iSelect enforces next‑day, as seen with Isupetasys (right today) breach in KODEX AI Semicon ETF clipped to 20%.
• Hyosung Heavy again ripping today; watch 30% breach — triggers next‑day ceiling cut. Play the reversion, hedge with other hot AI power basket names.

• Today after the close, Fujitsu Ltd (6702 JP), with 110,000 employees, announced a buyout of a small “labour-intensive” AI/ML sysdev business with 200+ data scientists.
• Brainpad Inc (3655 JP) is being bought out from its co-founders and others at a near-100% premium. Not an all-time high, but not a low price.
• Somewhat heavily shorted, this will trade tight, but I expect nobody will come over the top. 

• Brainpad Inc (3655 JP) has recommended a tender offer from Fujitsu Ltd (6702 JP) at JPY2,706, a 100.0% premium to the undisturbed price.
• The offer is attractive compared to historical trading ranges and is above the midpoint of the target IFA DCF valuation range. 
• The huge takeover premium resulted from an auction. The tender offer runs from 31 October to 15 December (30 business days). This is a done deal.  

• It was announced today that Samsung’s Lee family members are selling about 1.8 trillion won worth of Samsung Electronics (005930 KS) through an after-hours block trade. 
• The purpose of the block trade is for the Lee family members to pay for inheritance taxes and repay stock-backed loans.
• The block trade selling level is between 102,200 won and 104,100 won, representing a discount of 0% to 1.8% compared to the closing price of the day.

• Sumitomo Densetsu (1949 JP) has recommended a tender offer from Daiwa House Industry (1925 JP) at JPY9,760, a 28.1% premium to the undisturbed price.
• The process is deficient due to the lack of an auction and the offeror’s reliance on less than 100% voter turnout to pass the EGM share consolidation vote.
• Nevertheless, the offer is attractive, as it represents an all-time high and is above the high end of the IFA DCF valuation range. 

• Sumitomo Riko Company (5191 JP) has recommended a tender offer from Sumitomo Electric Industries (5802 JP) at JPY2,600, a 20.6% premium to the undisturbed price.
• The offer is arguably attractive as it is above the midpoint of the special committee/target IFA DCF valuation range and represents an all-time high. 
• The offer is light as it implies a discount to peer multiples. However, the significant cross-holders on the register suggest that the minimum tendering condition should be met. 

• After ANE Cayman Inc (9956 HK), a road freight transportation play, was suspended pursuant to the Takeovers Code, an Offer from PE outfit Centurium Partners, a pre-IPO investor, was expected. 
• And this is what unfolded. Centurium, together with Temasek and Singapore-based asset manager True Light, are offering HK$12.18/share (best & final) via a Scheme, a 48.54% premium to undisturbed.
• A scrip alternative is present (mix & match). This is a pre-conditional Offer: it requires SAMR signing off. The FA is JPM. This should help smooth over the reg process.

• In response to the Nikkei report, Scsk Corp (9719 JP) has recommended a tender offer from Sumitomo Corp (8053 JP) at JPY5,700, a 31.5% premium to the last close.
• The offer is attractive compared to precedent transactions, is above the midpoint of the IFA DCF valuation range and represents an all-time high. 
• An attractive offer facilitates deal completion. The tender runs from 30 October to 12 December, with payment commencing from 19 December.

• HD Hyundai merger: both legs in index, Mipo delists, slot opens — one new name gets added to KOSPI200 via ad‑hoc.
• Sanil Electric (062040 KS) to replace HD Mipo pre‑Dec review. If DTV settles back into the 500–600k range, then KS200 ETFs will need to scoop ~0.3–0.4x DTV on Nov 26.
• Better to front‑run KRX; with AI power trade still hot, Nov 20 announcement likely sparks outsized price action vs waiting for rebalance print.

• AUB Group Limited (AUB AU), which operates a network of insurance “matchmakers”, has announced a NBIO, via a Scheme, from EQT @ A$45/share, a ~40% premium to undisturbed.
• That indicative price is up from $43/share proposed on the 13th September (but not made public). 
• AUB’s board has opted to open its books to EQT, on an exclusive basis, for six weeks. Tentatively, that expires on or around the 9th December. 

• On 29 October, SK Square announced that it is selling its stake in 11st to SK Planet. This is likely to have a slightly negative impact on SK Square.
• Given SK Planet’s limited financial resources, it is likely that SK Square will provide funding to SK Planet through a capital increase.
• However, the biggest factor driving SK Square’s share price right now is the continued surge in SK Hynix’s share price. 

• Today, the Nikkei reported that Sumitomo Corp (8053 JP) plans to privatise Scsk Corp (9719 JP) through a tender offer. Both shares were placed on a trading halt.
• The Nikkei states that the total acquisition cost would be around JPY800 billion, based on an arbitrary assumption that the offer will be around 20% above the undisturbed price.
• The privatisation is strategically sensible. The rumoured offer price of JPY5,109.60 is attractive compared to peer multiples and would represent an all-time high. 

• Groww (1573648D IN) is looking to list on the exchanges by selling 663.23m shares via a primary and secondary offering to raise US$752m at a valuation of US$7bn.
• The price band has been set at INR 95-100/share, and the issue is likely to price at the top end of the range.
• The stock will not get Fast Entry to global indices. Inclusion at regular rebalances will commence in June 2026 but flow will be small given the low float.

• Cipla Ltd (CIPLA IN) signed an exclusive distribution and promotion agreement with Eli Lilly on 23 October 2025 to market tirzepatide under the brand name Yurpeak in India.
• The deal positions Cipla as a first mover in India’s nascent GLP-1 obesity care segment, projected to grow 40x by 2030.
• Financially modest but strategically transformative, the deal anchors Cipla’s entry into obesity therapeutics and sets the stage for a broader GLP-1 platform spanning branded and generic drugs.

• Bidders Nordic Capital and Permira raised their offer to DKK 250/share (from DKK 233), but ATP’s 10% block and limited irrevocables complicate closing.
• Gross spread has widened to 5.71% (DKK 236.5 close on 28 Oct), reflecting rising uncertainty. Implied success probability is now ~76.5%.
• High upside if completed, but downside risk remains to pre-deal levels (DKK 192.5). Time to settlement is short, pushing annualized return to ~151%.

• Separation should unlock value by allowing J&J to double-down on high-growth, higher-margin MedTech and pharma businesses.
• SpinCo will emerge as one of the world’s largest pure-play orthopaedics firm with ~$9B revenue and global leadership across hips, knees, and trauma.
• We see valuation upside. Transaction is likely to enhance JNJ’s sum-of-the-parts value.

• The Digital Holdings Inc (2389 JP) Board has responded to SilverCape’s hostile offer by proposing countermeasures ostensibly to protect the interests of minorities.
• The precedent Makino countermeasures against Nidec’s hostile offer were intended to buy time for a higher white-knight offer. In this case, it is being done to facilitate a lower offer.  
• The countermeasures will severely dent SilverCape’s chances of succeeding. Hakuhodo Dy Holdings (2433 JP)’s irrevocables and insiders should be sufficient to pass the shareholder vote to implement the countermeasures. 

• In response to an AFR article, AUB Group Limited (AUB AU) confirmed that on 26 September, it received a non-binding proposal from EQT (EQT SS) at A$45.00.
• While the offer represents an all-time high, it is arguably light compared to precedent transactions and peer multiples. EQT’s history of unsuccessful ASX tilts warrants some caution. 
• The Board has granted a six-week exclusive due diligence period, which ends on 20 November. The shareholder structure reduces the vote risk. 

• Chey Tae‑won’s Korea–Japan integration push is fresh tape—unpriced and unconsumed—unlike the exhausted dividend tax story, making it the real policy‑momentum trade to watch.
• Korea’s export model is fading, but a $6T Korea–Japan bloc plus CPTPP buzz offers a fresh policy‑momentum catalyst, with AI/data angles luring incremental global flows.
• Korea–Japan cooperation isn’t a real bloc yet, but it trades like a policy theme—Chey’s 3PRO push makes it a headline‑driven short‑term play ripe for desks.

• As first discussed back in May (see here), shares in Krungthai Card (KTC TB), XSpring (XPG TB), BEC (BEC TB), and The Practical Solution (TPS TB) all went limit down. Twice.
• As widely reported at the time, Mongkol Prakitchaiwattana reportedly pledged his holdings in all four companies. Pledged shares in KTC ballooned in June versus May, but since fallen.
• All four were mostly flat in Sept vs. August. Elsewhere, recent big moves were seen in BCPG (BCPG TB) (up), and Thai Foods Group (TFG TB) (down).

• ANE Cayman Inc (9956 HK) has disclosed a preconditional scheme privatisation offer from a consortium. The offer is cash (HK$12.18) or scrip (One TopCo Class A Share per scheme share). 
• The precondition relates to SAMR approval. The scheme vote is low risk, as the offer is attractive relative to historical ranges and peer multiples. 
• The offer price is final. Mr Wang Yongjun, the former chairman, holds a blocking stake but should be supportive. Timing is the key risk. 

• Robinhood’s acquisition of WonderFi Technologies at C$0.36/share has a current spread of 14%, with closing expected soon.
• Ambase is litigating against developers over a $150m Equity Put Right, with court opposition due by 11/18/25.
• Plymouth Industrial REIT announced a $22/share acquisition by Makakora Management, with a 30-day go-shop period included.

• After issuing a formal takeover notice on the 30th September, restaurant operator Restaurant Brands NZ (RBD NZ) announced an Official Offer from controlling shareholder Finaccess Restauración on the 14th October. 
• Finaccess is offering NZ$5.05/share in cash for shares not held. Best & final. Finaccess holds 75.02%. Accident Compensation Corporation, with 4.7%, is supportive. The Offer is unconditional.
• The Target Statement is now out, with an independent expert fair value of NZ$5.24-NZ$6.20. The Independent Directors believe the risks associated with remaining as a shareholder outweigh the Offer price.

• The EMC spin-off aims to surface hidden asset value by separating AREC’s high-growth battery-recycling unit, allowing EMC to attract a pure-play electrification multiple and investors clearer sum-of-the-parts visibility.
• The separation positions AREC as an asset-light critical-materials holding company, retaining minority stakes in ReElement, Novusterra, and Royalty Management while enabling EMC to independently pursue commercialization and partnerships.
• EMC gains dedicated access to growth capital and strategic investors, while AREC enhances financial optionality and valuation clarity across its diversified clean-energy and infrastructure holdings.

• In August, Toyoda Gosei (7282 JP) announced a deal for Ashimori Industry (3526 JP) at 1.000x book value after writedowns. That was not a coincidence.
• The takeover is cheap for what it is. No synergies were counted. But it wasn’t truly offensive. MURAKAMI Takateru aimed an activist broadside, bought 19.73% across four entities. Then stopped. 
• The Bidder lowered the Tender Offer Minimum from 2.3081mm shares (38.29%) to 1.8001mm shares (29.86%). Shares dropped. As of 24-Sep, 2,111,226 shares had been tendered. This looks done. Maybe. 

• Last week, London-based activist Palliser Capital tapped LG Chem (051910 KS) to remedy its NAV market discount. Palliser also said it now holds a little over 1% in LG Chem.
• LG Chem’s large NAV discount is well known. It has been present since ~82%-held LG Energy Solution (373220 KS) (LGES) was listed in January 2022. 
• An obvious solution is to pare down the LGES stake, and buy back shares. Yet the discount remains as the market views management as being (stubbornly) set in their ways.

• HMC buyback ~₩0.8–1.0tn (~1.5% SO). Street focus is ord/pref split, with prefs at ~25% discount. Mgmt urgency: lift equity value as K‑market rallies.
• Narrowing the pref gap seen as the cleanest lever—shareholder‑friendly signal, draws real money/offshore flows, de‑risks policy optics—so locals expect the first buyback leg skewed to prefs.
• Street sees HMC aiming mid‑teens pref discount via year‑end pref‑heavy buyback and dividend tax reform. Catalysts make narrowing trend look achievable.

• Comcast’s planned spin-off of Versant Media creates two sharper investment profiles – broadband and infrastructure (Comcast ex-Versant) versus content and networks (Versant) – enabling clearer strategic focus and capital discipline.
• Post-Spin, Comcast retains $117B revenue and 30% margins, while Versant will have $7B media portfolio with 40% EBITDA margins.
• Our sum-of-the-parts (SOTP) valuation assigns 6.0× to Comcast and 8.4× to Versant, implying combined equity value of $146.5B, or $39 per share.

• Honeywell will complete the tax-free spin-off of its Advanced Materials division as Solstice Advanced Materials Inc. (Nasdaq: SOLS) on October 30, 2025.
• We value HON(ex-SOLS) at $228/share on a SOTP basis. We value Solstice at $60/share based on 10.9× FY2026E EBITDA of $1.0B, implying ~31% upside to the when-issued price of $45.75
• SOLS has greater upside potential at current levels. Given its smaller market capitalization, index rebalancing flows post-listing could trigger near-term technical selling pressure, which may provide even better entry point.

I had a chance to talk to the management team from High Arctic Overseas this week, and I came away encouraged.

The stock is trading at a negative enterprise value, but we are seeing signs of stability in the business and a potential upward inflection.

The management team is entrepreneurial and working to cut its cash burn down to zero. 

• Before I get into my regular update, I want to flag one chart that caught my eye.
• The chart below shows that margins have held in there in the face tariffs. This is somewhat surprising to me.
• This week was relatively quiet on the open-recommendations front, but I expect the news flow to pick up in the coming weeks as earnings season gets underway

• De Beers sale shows competitive tension: Endiama bid vs Botswana match rights; potential $2.5–4bn proceeds improve Anglo’s simplification and special-dividend optics.
• Votes: circular early/mid-Nov; same-day early-Dec. Teck-B 66⅔% remains higher-beta; interloper low pre-vote, very low post-vote.
• Spread: AAL 2,832p; TECK C$58.50; GBPCAD 1.86685 → implied TECK C$70.32; ~16.7% discount (~20.1% upside). Trade: long TECK(B)/short 1.3301× AAL, fully FX-hedged.

• EU clearance confirmed 27 Oct 2025; seven of ten jurisdictions approved. Remaining reviews in Brazil, Mexico, and China progress. Management now targets Q1 2026 completion, extending earlier Q4 2025 timeline.
• Implied offer value 85.8 p (AXL $6.49; GBP/USD 1.3313) vs DWL 83 p yields 3.4 % spread, or ~7–10 % annualised return under the revised Q1 2026 closing guidance.
• Funding and shareholder approvals complete; deal risk remains low and primarily timing-related. Residual focus on SAMR clearance and FX/AXL volatility driving daily implied consideration.

• Tsuruha Holdings (3391 JP) acquires Welcia Holdings (3141 JP) in just over 4 weeks. Aeon Co Ltd (8267 JP)‘s tender offer for Tsuruha Holdings (3391 JP) could commence in December/January.
• The enlarged Tsuruha Holdings (3391 JP) could migrate upward in the MGlobal Index and that will bring in large passive flows. But there is one thing to watch out for.
• Tsuruha Holdings (3391 JP) and Welcia Holdings (3141 JP) have outperformed peers over the last 6 months and now trade at a higher forward PE.

• 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: Smart Share Global (EM US), Mayne Pharma (MYX AU), ENN Energy (2688 HK), Dongfeng Motor (489 HK), Changhong Jiahua Holdings (3991 HK), Joy City Property (207 HK).
• Lowest spreads: Bright Smart Securities (1428 HK), Mandom Corp (4917 JP), Humm Group (HUM AU), Larvotto Resources (LRV AU), Seven West Media (SWM AU), Jinke Smart Services (9666 HK). 

• Seres Group (601127 CH) could raise up to HK$17.4bn (US$2.24bn) in its H-share listing if the Offer Size Adjustment Option and the Overallotment Option are both exercised.
• There is a big allocation to cornerstone investors that is locked up for 6 months. That eliminates the already small possibility of Fast Entry inclusion to global indexes.
• Seres (9927 HK) should be added to Southbound Stock Connect from the open of trading on 1 December following the end of the Price Stabilisation period.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Sany Heavy Industry (600031 CH), Seres Group (601127 CH) and Pony AI (PONY US) H Share listings.
• Event-Driven developments: Digital Holdings Inc (2389 JP), Pacific Industrial (7250 JP), Soft99 Corp (4464 JP), Joy City Property (207 HK), Minmetals Land (230 HK), Larvotto Resources (LRV AU). 

• Context: Index heavyweight HSBC (5 HK) / HSBC (HSBA LN) is set to report results on 28 October at 12:00 HKT — during the Hong Kong trading lunch break.
• Timing & Trading: The 30 Oct and 31 Oct option expiries offer direct instruments to gauge HSBC’s post-earnings volatility — or to take targeted exposure to, or hedge, the event.
• Expected Move: Historical data reveals HSBC’s announcement-day moves are significantly larger than on average trading days, with options currently pricing in a remarkably aligned ± 3.1% implied move.

• Lenskart Solutions (0370405Z IN) is looking to list on the exchanges by selling 181.05m shares via a primary and secondary offering to raise US$829m at a valuation of US$7.95bn.
• The price band has been set at INR 382-402/share, and the issue is likely to price at the top end of the range.
• The stock will not get Fast Entry to global indices. Inclusion at regular rebalances will commence in June 2026 but flow will be small given the low float.

• Gross SOUTHBOUND volumes just over US$21bn a day two weeks ago as markets fell sharply. About two-thirds that this past week as indices rebounded. High-div SOEs seeing buying demand.
• The recommended name was short Fuyao Glass Industry Group (3606 HK). The stock was -4.9% over two weeks, but the H outperformed its A by 0.55%.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The Southbound Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• The last two weeks have seen “Beautiful Skew” behave badly across the ten trading days. CNOOC Ltd (883 HK) is trading too wide for its div into year-end.
• The long reco on Guangzhou Automobile Group (2238 HK) two weeks ago saw the H-share rise 6.8% from the next day through Friday, and the H OUTperformed its A by 2.62%.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• KeePer Technical Laboratory (6036 JP) has switched its allegiance from the Soft99 Corp (4464 JP) MBO by agreeing to accept the higher Effissimo offer. 
• KeePer’s change of heart sets a huge precedent and signals that irrevocables are unenforceable and fiduciary duty outweighs a promise to tender.
• Nevertheless, the outcome is still not set in stone. Effissimo’s chances of success have increased, but the MBO still retains a long-shot chance of success.

• Palliser discloxes stake in LG Chem Ltd (051910 KS), and subsequently seeks to spill the board and undertake buybacks. 
• The family  increased their bid for Pacific Industrial (7250 JP) by 42.4%, from ¥2,050 to ¥2,919/share. This now becomes a short-term rate of return trade. It will trade relatively tight.
• First Pacific Co (142 HK) appears to have squeezed the most out its unlisted subsidiary MPIC, for now, with the forthcoming Maynilad IPO.

• I tally 42 – mostly firm, mostly Asia-Pac – arb transactions currently being discussed and analysed on Smartkarma.
• Two new deal was discussed on Smartkarma this week: Larvotto Resources (LRV AU) and Minmetals Land (230 HK).
• Key updates/news took place on: Apiam Animal Health (AHX AU), Lynch Group Holdings (LGL AU), Joy City Property (207 HK), Shibaura Electronics (6957 JP), and Mandarin Oriental International (MAND SP).