Event-Driven

On 11-Oct, Bain submitted a binding proposal for Fuji Soft Inc (9749 JP). On 15-Oct, FSI acknowledged, but questioned the Nozawa family commitment. Founder Nozawa wrote letters the 17th.
O 18-Oct, FSI reiterated support for the KKR First Tender in a late night drop. It included fine print, but no media coverage. Today, FSI filed a Target Opinion Amendment.
That filing included yet more fine print not in the public filing Friday. And KKR extended. The new fine print is nuanced. But worth reading.

Shinko Electric (6967 JP) Takeover – THIS Is a Dip to Buy

Over the last few days, Shinko Electric Industries (6967 JP) shares have dipped lower than the previous standard trading range.
I expect this weakness is related to investors in other deals deciding to sell this deal too. I believe it is not related to Shinko specifically.
For that, while gap risk remains somewhat high, I still see break risk as low and see this as a great opportunity to buy the dip.

Hang Seng Internet & IT Index (HSIII) Rebalance Preview: Capping Flows in December

The December rebalance for the HSIII Index only involves capping to limit stocks to 12% of the index weight. There will not be any constituent changes.
Estimated one-way turnover at the rebalance is 4.4% resulting in a round-trip trade of HK$2.9bn (US$378m).
The largest outflows are expected to be from Meituan (3690 HK) and JD.com (9618 HK) with inflows spread across the other index constituents.

Entry Opportunities from Delisting Risk Due to Korea Zinc’s Post-Buyback Volume Drying Up

Korea Zinc’s delisting daily trading volume cutoff is 20K, about 0.12% of the total. We might see volumes plummet, making it tough to maintain even that 20K level.
Keep an eye on trading opportunities; we have some time with delisting risks, but low trading volume could lead to being booted from the KOSPI 200 and Global Index.
This sell-off could spike short-term volatility and create great entry points for trading, especially after the court approved the buyback tender, denying MBK’s injunction.

Doosan’s Tweaked Restructuring Play: My Take on Hitting Robotics’ 13% Spread

The big question is how to cash in on the dissenters’ rights spread for Robotics. The main concern is cancellation risk, but the FSS doesn’t seem too negative on approval.
To sustain nuclear momentum, Enerbility needs heavy borrowing for facility investments, requiring a lower debt ratio. Offloading debt-heavy Bobcat is a move shareholders might support.
With NPS unlikely to ignore the government’s nuclear push, Robotics’ spread could narrow quickly. Despite cancellation risk and no hedge, the remaining juice makes an outright position worth considering.

Hyundai Motor India IPO: How Far to Fast Entry?

Hyundai Motor (005380 KS) raised INR 279bn (US$3.3bn) by selling some of its stake in Hyundai Motor India (1342Z IN), valuing Hyundai India at INR 1,593bn (US$18.95bn).
The anchor investor book was fully subscribed. The non-institutional and retail books were undersubscribed, so institutions got more stock. And that changes the free float estimates for one global index.
Even with the higher float, Hyundai Motor India (1342Z IN) is unlikely to get Fast Entry to one global index later this month. Index inclusions should commence in February 2025.

Korea Zinc: Court Dismisses the Second Injunction Filed by MBK

By Douglas Kim

The Seoul Central District Court dismissed the second injunction filed by MBK Partners and Young Poong to suspend the share buyback/tender offer by Korea Zinc Chairman Choi and his allies.
As a result of the court dismissing the second injunction filed by MBK, the M&A fight for Korea Zinc is likely to continue until the AGM in March 2025.
Depending upon Korea Zinc’s tender offer subscription, there is a possibility of MBK buying more shares directly from the market if the subscription falls below the proposed amounts.

Quiddity Leaderboard ASX Dec 24: Clarity Pharma and Resolute Mining Competing for ASX 200 Spot

In this insight, we take a look at the potential index changes for ASX200, 100, 50, and 20 in the run-up to the December 2024 index rebal event.
We currently do not see any index changes for ASX 20 and ASX 100.
We continue to expect one change for ASX 50. However, our expectations for ASX 200 have changed since our last insight (link).

International Games System (3293 TT): Positioning & Potential Passive Buying

International Games System (3293 TT) could be added to a global index at the end of November and there will be a lot of buying in the stock.
The big rally in the stock has led to International Games System (3293 TT) trading expensive to its regional peers.
There has been an increase in cumulative excess volume over the last month. But there could still be more to go over the next week.

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Oct 21

Daily Brief Event-Driven: Fuji Soft (9749 JP): The Board’s Unchanged Recommendation Caps the Upside and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Fuji Soft (9749 JP): The Board’s Unchanged Recommendation Caps the Upside
China Healthcare Weekly (Oct.20)-A Big Lesson from China TCM’s Deal Break, “Must Option” of Biotech
Fujikura (5803 JP): Positioning & Potential Passive Buying
Merger Arb Mondays (21 Oct) – Seven & I, Fuji Soft, Henlius, Canvest, GA Pack, Dyna-Mac
Korea Value-Up Index: Estimated Passive Flows as ETF Launches Coming
[JAPAN ACTIVISM] Murakami Group Now 23.5% on Exedy (7278) – LOTS of Room Left To Run
SSE50 Index Rebalance Preview: Potential Inclusions Continue to Outperform; Trim into Strength
EQD | Nikkei 225 Option Implied Volatility Analysis – Focus on Bank of Japan Rate Decision Catalyst
EQD / NSE Vol Update / Options Mkt. Structural Changes Incoming: 15x Position Limits + 3x Lot Size

Fuji Soft (9749 JP): The Board’s Unchanged Recommendation Caps the Upside

The Fuji Soft Inc (9749 JP) Board has maintained its recommendation of KKR’s first-stage tender offer. However, the recommendation was not unanimous, with four dissenting directors.
Bain’s likely next move is to waive the precondition and launch its offer. To bring KKR to the negotiating table, Bain will want to acquire as many shares as possible.
KKR’s first stage closes on 21 October. Success requires KKR to either work with Bain or match terms. As shares trade through Bain’s terms, there is little or no upside.

China Healthcare Weekly (Oct.20)-A Big Lesson from China TCM’s Deal Break, “Must Option” of Biotech

By Xinyao (Criss) Wang

The “industry clearing” of innovative drug companies is far longer and more brutal than imagined. But Chinese innovative drug ecosystem will ultimately usher in a better innovation pattern in the future.
For every innovative pharmaceutical company with ambitious goals, globalization is a “must option”. With more and more Chinese biotech achieving success, the internationalization prospects will become better and better.
China TCM’s privatization failure made us realize large SOEs we always believe in would violate their commitments to market/investors.Now, we need to get back to the fundamentals to minimize losses.

Fujikura (5803 JP): Positioning & Potential Passive Buying

Fujikura Ltd (5803 JP) could be added to a global index at the end of November and there will be a lot of buying in the stock.
Following the rally in the stock, Fujikura Ltd (5803 JP) trades expensive to the average and median of its peers on most valuation metrics.
The increase in cumulative excess volume in Fujikura Ltd (5803 JP) over the last 3 months far outpaces the increase in its peers.

Merger Arb Mondays (21 Oct) – Seven & I, Fuji Soft, Henlius, Canvest, GA Pack, Dyna-Mac

We 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: Seven & I Holdings (3382 JP), Shanghai Henlius Biotech (2696 HK), Shinko Electric Industries (6967 JP),Canvest Environmental Protection Group (1381 HK), Arcadium Lithium (LTM AU).
Lowest spreads: Trancom Co Ltd (9058 JP), Fuji Soft Inc (9749 JP), Silverlake Axis (SILV SP), T Gaia Corp (3738 JP), Descente Ltd (8114 JP), Pasco Corp (9232 JP).

Korea Value-Up Index: Estimated Passive Flows as ETF Launches Coming

The KRX announced the 100 constituents of the much-awaited Korea Value-Up Index on 24 September. There were hits and misses but broad consensus was that the index is a miss.
Following market feedback, the KRX could conduct a special rebalance of the index in December. But this could be after the launch of ETFs tracking the index.
With a big overlap and similar characteristics as the KOSPI 200 Index, there could be limited assets benchmarked to the Korea Value-Up Index in the short-term.

[JAPAN ACTIVISM] Murakami Group Now 23.5% on Exedy (7278) – LOTS of Room Left To Run

This past week, activist Murakami-san’s City Index Eleventh announced that the companies which jointly report now own 20.3%, which translates to 23.5% of voting rights. Average in-price? ¥2,928/share.
The 2030 Plan from April saw 8% ROE by 2030, 6% by 2026. They’ve since bought back 11% of shares out. Better, but 1/4 of market cap is net cash+securities.
If one assumes they spend the net cash+securities to buy back stock 10% higher than here, pro-forma PBR is <0.6x. ROE would be 7+%. There’s room to run here, still.

SSE50 Index Rebalance Preview: Potential Inclusions Continue to Outperform; Trim into Strength

With over 95% of the review period complete, 4 non-constituents are in inclusion zone and 6 constituents are in deletion zone.
We estimate one-way turnover of 6.5% at the December rebalance leading to a one-way trade of CNY 11.95bn (US$1.7bn). Index arb balances could increase the impact on the stocks.
The potential adds have continued to outperform the potential deletes. There has been a big jump in the last few weeks as markets have rallied. Trim positions into strength.

EQD | Nikkei 225 Option Implied Volatility Analysis – Focus on Bank of Japan Rate Decision Catalyst

By Gaudenz Schneider

Nikkei 225 (NKY INDEX) option implied volatility is stabilizing at an elevated level. This Insight analyses term structure, skew, open interest, and more.
We identify a tactical option opportunity that profits from the current volatility structure.
Are Consumer Price Index and Bank of Japan interest rate decision announcements systematically followed by unusually large market moves? We run the numbers.

EQD / NSE Vol Update / Options Mkt. Structural Changes Incoming: 15x Position Limits + 3x Lot Size

By Sankalp Singh

SEBI-Mandated structural changes continue to percolate through for Options Markets. Position limits & lot sizes have been increased drastically, tilting regulations away from Retail & towards more Institutional participation.
IV levels are in the middle of their 12-month ranges. Vol-Regime Model currently in “High & Down” state – grind lower in IVs projected.
In spite of a stronger underlying index, upcoming Bank earnings results have supported BankNifty IVs.

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Oct 20

Daily Brief Event-Driven: TCM (570 HK): Likely Rush for The Exits As Deal Busts and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

TCM (570 HK): Likely Rush for The Exits As Deal Busts
Fuji Soft (9749) Reiterates Support for KKR Tender#1, Recos Shareholders Wait, Ignores Nozawa Letter
(Mostly) Asia-Pac M&A: GJS/Haitong, Fuji Soft, Bossini, Dyna-Mac, Beijing Capital Grand, TCM
A/H Premium Tracker (To 18 Oct 2024): AH Premia Drop Sharply; High Premia May Contract More
HK Connect SOUTHBOUND Flows (To 18 Oct 2024); Net Flows Big, Selling in Brokers, Buying in Props
Last Week in Event SPACE: Seven & I/Couche-Tard, Intouch, SAMTY, Korea Zinc/Young Poong
Weekly Deals Digest (20 Oct) – China TCM, GA Pack, Tokyo Metro, Rigaku, CR Beverage, Horizon Robotic

TCM (570 HK): Likely Rush for The Exits As Deal Busts

China Traditional Chinese Medicine (570 HK) (TCM) has been a frustrating deal, for a deal that shouldn’t be frustrating.
As feared from its 16th October monthly update, the inability to secure investor group consents appears to have torpedoed the transaction. Will we eventually find out why this got stonewalled?
This deal lapse changes the Hong Kong M&A landscape; if you can’t rely on SOE transactions to get up, what next? The immediate question now is downside support on Monday.

Fuji Soft (9749) Reiterates Support for KKR Tender#1, Recos Shareholders Wait, Ignores Nozawa Letter

On Tuesday, Fuji Soft Inc (9749 JP) said they had received the legally-binding Bain proposal on 11 October, but noted they could not confirm founder Nozawa-san’s agreement or intentions.
Founder Nozawa Hiroshi responded with a pair of impassioned letters Thursday criticising process, asking Fuji Soft to withdraw support for KKR, and switch to or allow the Bain Offer.
Fuji Soft on Friday reiterated support for the KKR First Tender, but interestingly, saw a majority resolve to suggest common shareholders NOT tender because of the optionality.

(Mostly) Asia-Pac M&A: GJS/Haitong, Fuji Soft, Bossini, Dyna-Mac, Beijing Capital Grand, TCM

I tally 44 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
One new deals discussed this week: Bossini International (592 HK) low-balled scrip Offer from Viva Goods (933 HK). Beijing Capital Grand (1329 HK) also suspended due to the Takeovers code.
Key updates took place on: GJS (2611 HK)/Haitong Securities (600837 CH), Fuji Soft Inc (9749 JP), Hotel Property Investments (HPI AU), TCM (570 HK) and Dyna Mac Holdings (DMHL SP)

A/H Premium Tracker (To 18 Oct 2024): AH Premia Drop Sharply; High Premia May Contract More

Huge volumes traded on the mainland, Southbound volumes dropped, AH Premia contracted a little bit, but not much. Things are starting to stabilise.
Average AH pairwise volatility is super high. Intracorrelation of spreads quite low. Lots of room to market-make wide spreads/high premia. High premia may continue to contract on speculation.
Continuing different onshore and offshore opinion regarding the nature and vibe of Chinese stimulus will continue to lead to interesting dispersion. Identify the trend, then market make around it.

HK Connect SOUTHBOUND Flows (To 18 Oct 2024); Net Flows Big, Selling in Brokers, Buying in Props

This past week saw mainland investors trade HK$476bn of stock. Not as big as last “week” but still big. BABA buying has slowed, but net buying was still HK$24.4bn
The buying is starting to see a longer tail of net positive names, and properties this week saw big net buying, even before the Sunac placement which added more.
High-Div SOEs are seeing outflows as beta sees inflows. I expect this to continue.

Last Week in Event SPACE: Seven & I/Couche-Tard, Intouch, SAMTY, Korea Zinc/Young Poong

Couche-Tard execs do the rounds in Tokyo, complaining about not being able to do the rounds. This sounds like they are trying to make themselves sound nice. For now
First the low-balled VTOs for AIS (ADVANC TB) and Thaicom (THCOM TB). Then the Intouch (INTUCH TB)/Gulf Energy (GULF TB) amalgamation. Then, arguably, the next unorthodox development will take place.
Investors buying SAMTY HOLDINGS (187A JP) in size may withhold shares, either they’ll try to become the fulcrum investor to get into the Bidco OR they will try for a bump.

Weekly Deals Digest (20 Oct) – China TCM, GA Pack, Tokyo Metro, Rigaku, CR Beverage, Horizon Robotic

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: Tokyo Metro (9023 JP), Rigaku Holdings (268A JP), Horizon Robotics (9660 HK), China Resources Beverage (2460 HK) and Hyundai Motor India (1342Z IN) IPOs.
Event-Driven developments: China Traditional Chinese Medicine (570 HK), Greatview Aseptic Packaging (468 HK), Sun Art Retail (6808 HK), Fuji Soft Inc (9749 JP), Dyna Mac Holdings (DMHL SP).

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Oct 19

Daily Brief Event-Driven: China Traditional Chinese Medicine (570 HK): Disaster as Offer Lapses and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

China Traditional Chinese Medicine (570 HK): Disaster as Offer Lapses, Potential Deal Break Price
Thematic Report : Investment Opportunities in Indian Markets Led by Promoter Buying
Need a Game Plan to Tackle Korea Zinc’s Buyback Tender with a 20% Proration Risk
ABC/TI Fluid Systems: 10% Gross Spread on a Highly Likely Deal
Align Partners Goes Activist on Doosan Bobcat
EQD | Upcoming ASX200 Pullback in 1-2 Weeks

China Traditional Chinese Medicine (570 HK): Disaster as Offer Lapses, Potential Deal Break Price

Shockingly, the Sinopharm-led consortium’s offer for China Traditional Chinese Medicine (570 HK) has lapsed as the precondition long stop date has not been extended.
This deal break caught many, including me, off guard. There are lessons to be learnt and questions to be asked.
Shareholders will have a bruising Monday. Our analysis suggests a deal break price of around HK$3.44, a 10% downside to the last close.

Thematic Report : Investment Opportunities in Indian Markets Led by Promoter Buying

By Nimish Maheshwari

In the overheated Indian markets where selling spree by promoters is going at record pace.
We identified certain interesting companies where promoters are buying giving confidence in their business
We further delve into the thesis and key triggers for these companies

Need a Game Plan to Tackle Korea Zinc’s Buyback Tender with a 20% Proration Risk

NPS is now viewing their voting rights on Korea Zinc purely from a returns angle, shifting from earlier expectations of siding with Choi due to political pressure.
We need a tendering strategy for a 20% proration risk, focusing on when MBK will buy that extra 3.7% stake to cut losses on untendered shares.
MBK will aim to buy leftover shares cheaply. Their approach depends on the progress of Choi and Trafigura’s talks

ABC/TI Fluid Systems: 10% Gross Spread on a Highly Likely Deal

By Jesus Rodriguez Aguilar

TI Fluid Systems (TIFS LN) is trading at 10% gross spread to ABC (Apollo)’s Proposal, which the Board of TIFS would be minded to recommend if made firm.
Although TIFS has made notable strategic progress recently, and maintained margins despite tough conditions over the last years, the short-term car picture has gotten progressively worse.
200p implies 4.6x EV/NTM EBITDA versus global auto suppliers trading on a median of 4.4x and represents a good-value exit. I believe the deal will complete. Long.

Align Partners Goes Activist on Doosan Bobcat

By Douglas Kim

On 18 October, a local activist fund Align Partners Asset Management started its “corporate activism” on Doosan Bobcat Inc (241560 KS).
Align Partners sent a shareholder proposal letter requesting a significant increase in the shareholder return rate, including dividends and selling off non-core assets.
We believe that Align Partners’ corporate activism on Doosan Bobcat is likely to have a positive impact on Doosan Bobcat’s share price.

EQD | Upcoming ASX200 Pullback in 1-2 Weeks

By Nico Rosti

This week the S&P/ASX 200 INDEX entered WEEKLY OVERBOUGHT status intra-week, peaking at 8384.50, then pulling back to 8283.20 at Close.
In this insight we will examine resistance levels the index will have a hard time to clear, without pulling back first at least 1 week.
According to our quantitative models, a pullback is highly likely to happen this week, or the next.

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Oct 18

Daily Brief Event-Driven: Couche-Tard Execs in Tokyo and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Couche-Tard Execs in Tokyo, “Hoping” For Meetings But Really There To Hold a Press Conference
Samty (187A) Deal Looks Somewhat Vulnerable to Potential Interlopers
S&P/NZX 50 Index Rebalance: Tower (TWR) Replaces Arvida (ARV)
Beijing Capital Grand (1329 HK): Beijing Capital Land Offer?
Event Driven: Special Call Auction in Indian Holding Companies
Connecting the Dots Between Kum Yang’s Rights Offer & Global Index November Review
Korea Zinc’s 2.4% Treasury Shares – Devil Is In the Legal Loophole
Charter Hall Bumps With Final HPI Bid
Waystar Holding (WAY US): Clear WAY to One Global Index, Rocky Road to the Other.
Beijing Capital Grand (1329 HK): An Offer from Beijing Capital Land?

Couche-Tard Execs in Tokyo, “Hoping” For Meetings But Really There To Hold a Press Conference

Alimentation Couche-Tard (ATD CN)‘s CEO, former CEO, CFO, and founder were in Tokyo today giving a press conference about their trip and designs on Seven & I Holdings (3382 JP).
There was some passive-aggressive behaviour. Their bid was better than 7&i’s plan. They said it was a high price. They said they wanted to meet management, the ITOs, the government.
None of that will win the hearts and minds of the Special Committee.

Samty (187A) Deal Looks Somewhat Vulnerable to Potential Interlopers

The Hillhouse (Asia-based global PE firm) deal for SAMTY HOLDINGS Co Ltd (187A JP) has seen Samty shares trade tight to terms in the first three days of trading.
Some 7.5mm shares have traded. This is only 16% of shares out, but it is a much larger portion of Maximum Real World Float.
This begs the question of whether the deal could be put in jeopardy by the actions of one or two shareholders.

S&P/NZX 50 Index Rebalance: Tower (TWR) Replaces Arvida (ARV)

Arvida (ARV NZ) will be deleted from the S&P/NZX 50 Index following its acquisition by Stonepeak Alps BidCo. Tower Ltd (TWR NZ) will be added to the index.
Passive NZX50 Index trackers will need to buy nearly 18m shares of Tower Ltd (TWR NZ) – that is over 26 days of ADV.
There has been a lot of positioning in Tower Ltd (TWR NZ) since Stonepeak’s offer for Arvida (ARV NZ). There should be enough supply for the passive trackers.

Beijing Capital Grand (1329 HK): Beijing Capital Land Offer?

Beijing Capital Grand (1329 HK) (BCG), a commercial property developer in China, is currently suspended pursuant to the Takeovers Code.
Beijing Capital Land Ltd H (2868 HK) (BCL) holds a 65.72% stake, having secured majority control in Juda International, as BCG was then known, in November 2013.
BCG has been a forgettable stock since 4Q16. Expect a forthcoming Scheme from BCL, perhaps at ~HK$0.75/share.

Event Driven: Special Call Auction in Indian Holding Companies

By Nimish Maheshwari

A special call auction shall be held on October 28, 2024 by BSE & NSE to discover hidden value in Investment Holding Companies.
BSE and NSE came out with the list of 8-9 Companies that are eligible for this special session.
We calculated the upside left in these companies using the Current price with 30% discount: 3 Companies with more than 100% upside.

Connecting the Dots Between Kum Yang’s Rights Offer & Global Index November Review

Personally, the key trading angle is Kum Yang’s exit, which could slash entry costs for the capital raise, with the review announcement dropping as stock rights trading starts.
Along with the usual hit to the pricing from index trackers unloading for rebalancing, there’s a strong chance their sell orders might also include stock rights.
From an entry cost perspective, this November review could trigger a sharp, short-term drop in costs due to stock rights dumping, similar to what we saw with CJ CGV.

Korea Zinc’s 2.4% Treasury Shares – Devil Is In the Legal Loophole

By Douglas Kim

Devil is in the legal loophole. Issuing treasury shares to employees as bonuses is an exception that is not bound by the condition of ‘6 months after treasury shares acquisition.
It would be nearly impossible for Korea Zinc to sell 2.4% of its treasury stock to an external friendly force and transform it into a friendly stake by February 2025.
Although MBK/Young Poong Alliance has the advantage right now in this M&A battle for Korea Zinc, it is by no means over.

Charter Hall Bumps With Final HPI Bid

Back on the 9th September, pub play Hotel Property Investments (HPI AU) announced – and summarily rejected – a A$3.65/share cash Offer from Charter Hall Retail Reit (CQR AU).
Charter Hall has now increased terms to A$3.85/share (best & final), a 17.7% premium to undisturbed. The Offer remains conditional on an 50.1% minimum acceptance condition. Charter Hall holds 14.7%.
HPI’s reported response? “While Charter Hall’s improved offer provides an attractive exit for shareholders, we remain committed to evaluating all options that deliver the best long-term value.“

Waystar Holding (WAY US): Clear WAY to One Global Index, Rocky Road to the Other.

By Dimitris Ioannidis

Waystar Holding (WAY US) is forecasted to pass the mcap and fcap thresholds for the small-cap segment and get added at the November 2024 review.
The company currently passes the higher regional mcap and fcap thresholds for the small-cap segment at the December 2024 review.
Waystar Holding (WAY US) risks failing the fcap threshold at the December 2024 review if the stock price falls back to the IPO price levels.

Beijing Capital Grand (1329 HK): An Offer from Beijing Capital Land?

Beijing Capital Grand (1329 HK) entered a trading halt based on the Hong Kong Code on Takeovers and Mergers.
It is likely that Beijing Capital Land Ltd H (2868 HK), the largest shareholder, is launching an offer primarily to acquire the stake from Sino-Ocean Group (3377 HK) receivers.
As this is a forced sale, an offer of around HK$0.70-0.75, a 20%- 30% premium to the last close, would be sufficient to gain an irrevocable from the receivers.

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Oct 17

Daily Brief Event-Driven: Japan: Potential Passive Selling in November and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Japan: Potential Passive Selling in November
China Traditional Chinese Medicine (570 HK): Theatre of the Absurd
7&I Holdings (3382 JP) – Artisan Writes Another Letter – Based on Content, They Should Sell Any Pop
GJS/Haitong Merger Musings
Clean Energy & Global Water ETFs: Changes for Asia & Impact
TCM (570 HK): “Uncertain” To Spook Shares
Korea: Stocks with Potential Passive Flows in November
CR Sanjiu (000999.CH) To Acquire Tasly (600535.CH) Update – This Is Already a Done Deal
Liquid Universe of European Ordinary and Preferred Shares: October‘24 Report

Japan: Potential Passive Selling in November

Up to 9 stocks could be deleted from global passive portfolios in November. The deletion will lead to liquidity events where trackers will need to sell multiple days of ADV.
There has been a buildup of shorts on nearly all these stocks though the extent of the pre-positioning varies.
The increase in shorts is smaller than the estimated passive selling, though there is a fair amount of variability across the names.

China Traditional Chinese Medicine (570 HK): Theatre of the Absurd

China Traditional Chinese Medicine (570 HK)’s monthly update notes that the consortium has secured SAMR approval and made progress in obtaining the other regulatory approvals.
As expected, the precondition will not be satisfied before the 18 October long stop date. Unexpectedly, whether the consortium members will consent to the extension remains uncertain.
The extension will be forthcoming as the delay is procedural, there is a reputational risk from a deal break, the time investment is significant, and the warning was legally required.

7&I Holdings (3382 JP) – Artisan Writes Another Letter – Based on Content, They Should Sell Any Pop

Some two weeks after it became apparent Alimentation Couche-Tard (ATD CN) had lobbied a bid in for Seven & I Holdings (3382 JP), Artisan Partners wrote a letter.
It was full of misguided analysis, ungrounded insinuation of a general nature without specifying where they would have a problem. It seemed to be complaint for the sake of complaint.
Today another public letter. This time there are a couple of worthwhile suggestions, some accusations of fiduciary impropriety based on no evidence, and an implicit admission they should have sold?

GJS/Haitong Merger Musings

Back in March, the CSRC said it aimed to “form two to three investment banks and institutions with international competitiveness and market leadership by 2035″.
Last week’s announced merger between China’s leading state-backed brokerages, Guotai Junan Securities (2611 HK) and Haitong (6837 HK), is a move in that direction. Expect more scrip mergers to follow.
There have also been some media reports that the GJS/Haitong terms disadvantage holders of other Hong Kong broker stocks if potentially acquired in a merger. It’s not quite that simple.

Clean Energy & Global Water ETFs: Changes for Asia & Impact

There are 3 adds and 2 deletes for the iSharesGlobal Clean Energy ETF while there are 2 adds and 2 deletes for the iShares Global Water UCITS ETF.
With US$5bn benchmarked to the iSharesGlobal Clean Energy and related ETFs, and US$3.5bn benchmarked to the iShares Global Water and related ETFs, there is multiple days of ADV to trade.
We see a noticeable rise in cumulative excess volume over the last two trading sessions, so there will be positioning in the stocks.

TCM (570 HK): “Uncertain” To Spook Shares

China Traditional Chinese Medicine (570 HK) (TCM) will fall today. Perhaps a lot.
With two days left on the clock to secure the pre-conditions (18th October), the Offeror said “it remains uncertain” whether it can secure an extension from the investor group.
Such wording could be viewed as boilerplate SFC legalise. I would argue the use of “uncertain” is superfluous, unhelpful, and for investors, downright worrying.

Korea: Stocks with Potential Passive Flows in November

There are a few stocks in Korea that have outperformed/ underperformed their peers and could be added to or deleted from global passive portfolios next month.
There could be buying in Hyundai Rotem, while there could be selling in KT Corp, Celltrion Pharm, Kum Yang, Hyundai Engineering & Construction, Hyundai Steel, CosmoAM&T and L&F.
Based on our estimate of passive assets, trackers will need to trade between US$57m to US$230m of the stocks. Impact will vary between 3x-14.5x of ADV to trade.

CR Sanjiu (000999.CH) To Acquire Tasly (600535.CH) Update – This Is Already a Done Deal

By Xinyao (Criss) Wang

Since Tasly’s performance growth has long stagnated and Yan Kaijing has no better way to turn the situation around, selling Tasly to SOE and cashing out becomes a good choice.
Upon completion of all approvals (e.g. the SASAC, SAMR, shareholders’ meeting of CR Sanjiu, etc.), the deal aims to be completed in 25Q1. We think the deal will get up.
Tasly’s share price should be at least higher than RMB14.85/share based on the cash transfer price. Its P/E would reach 30 in the future after the integration with CR Sanjiu.

Liquid Universe of European Ordinary and Preferred Shares: October‘24 Report

By Jesus Rodriguez Aguilar

Since mid-September, share-price spreads have generally widened across our European liquid universe of ordinary and preferred shares (9 have tightened, 10 widened).
Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe, Volkswagen.
Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.

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Oct 16

Daily Brief Event-Driven: Quiddity Leaderboard ChiNext Dec 24: US$400mn Expected Inflow for Jiangsu Hoperun and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Quiddity Leaderboard ChiNext Dec 24: US$400mn Expected Inflow for Jiangsu Hoperun
Bossini (592 HK): Viva Goods Offer?
Quiddity Leaderboard CSI Medical Service Dec 24: US$271mn One-Way; 1x-4x ADV to Trade for Most Names
Quiddity Leaderboard CSI 300/500 Dec 24: Some Changes to Exp ADDs/DELs; Large Flow Expectations
Let’s Get Real About the Odds of MBK Launching a New Tender for YPP
Japan CorpGovReport Details: TSE “Mgmt Conscious of Capital Cost/Stock Price” Details (Oct24)
Takashimaya (8233 JP) Decent Earnings, BIG Buyback (Odd Register Dynamics)
Dyna-Mac (DMHL SP): Hanwha’s Final Offer Could Get the Deal Done
Horizon Robotics (9660 HK) IPO: Index Inclusion Possibility & Timelines
CSI 500 Index Rebalance Preview: 50 Changes; 11% Turnover; US$5bn Round-Trip Trade

Quiddity Leaderboard ChiNext Dec 24: US$400mn Expected Inflow for Jiangsu Hoperun

The ChiNext Index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
In this insight, we have presented our updated rankings for Potential ADDs and DELs for the upcoming index rebal event in December 2024.

Bossini (592 HK): Viva Goods Offer?

Bossini International Holdings (592 HK), a casual apparel play, is currently suspended pursuant to the Takeovers Code. As is Viva Goods (933 HK), Bossini’s largest shareholder, with 62.91%.
Former Olympic gymnast Li Ning holds 68.96% of Viva Goods. Viva Goods also holds a 10.37% stake in Li Ning (2331 HK).
The double suspension is probably a pre-cursor to Viva Goods tabling a delisting Offer for Bossini.

Quiddity Leaderboard CSI Medical Service Dec 24: US$271mn One-Way; 1x-4x ADV to Trade for Most Names

CSI Medical Service represents the top 50 largest and most-liquid stocks involved in medical devices, medical care, medical informatization and other medical theme from the Shanghai, Shenzhen and Beijing Exchanges.
In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in December 2024.
We expect up to five ADDs and five DELs for the CSI Medical Service index during this index rebal event based on the latest available data.

Quiddity Leaderboard CSI 300/500 Dec 24: Some Changes to Exp ADDs/DELs; Large Flow Expectations

CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500.
In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in December 2024.
We currently expect 16 ADDs/DELs for CSI 300 and 50 ADDs/DELs for CSI 500. Some of these names are different from what we had in our September 2024 insight.

Let’s Get Real About the Odds of MBK Launching a New Tender for YPP

Since MBK’s tender started, institutional trading has been light, leaving local retail investors in control. Choi’s 35% ceiling poses real proration risk for traders eyeing the action.
MBK might not have wanted YPP; they could just be using it as bait to not only drain Choi’s cash but also to put them in a tight financial spot.
MBK is set to focus on snapping up Korea Zinc shares in the open market to increase their stake and thwart any buyback tender offers.

Japan CorpGovReport Details: TSE “Mgmt Conscious of Capital Cost/Stock Price” Details (Oct24)

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.
Our tools show every report, links to every document, and now a new diff file tool. input a name, see the difference between the Old/New Reports. We hope it helps.
This tool is designed to be a shelf reference. We update it once a month, and every CorpGovReport and new “Management Conscious” report updated since a CGR update is here.

Takashimaya (8233 JP) Decent Earnings, BIG Buyback (Odd Register Dynamics)

Today, Takashimaya (8233 JP) reported Q2 earnings, a dividend hike, upward revisions to the FY26 MTMP, and a decent-sized buyback to raise leverage levels and ROE.
The company is yen-sensitive both in overseas retail and domestic department stores on inbound traffic. One could imagine future issues.
The register looks like it is quite open. It is not. That is worth considering now and in future.

Dyna-Mac (DMHL SP): Hanwha’s Final Offer Could Get the Deal Done

Dyna Mac Holdings (DMHL SP) disclosed a revised conditional offer from Hanwha Aerospace (012450 KS) and Hanwha Ocean (042660 KS) at S$0.67, an 11.7% premium to the initial S$0.60 offer.
The Estate (largest shareholder) stated that the previous S$0.60 offer was not compelling. The final offer addresses most of the Estate’s valuation concerns.
The Estate’s view and IFA opinion in the circular (despatched by 23 October) will be crucial to the acceptance rate. They are likely to support the final offer.

Horizon Robotics (9660 HK) IPO: Index Inclusion Possibility & Timelines

Horizon Robotics (1395186D CH) is offering 1.355bn shares in its IPO at a price range of HK$3.73-3.99/share. With the overallotment option, the IPO could raise up to HK$6.2bn (US$801m).
Cornerstone investors will take up a third of the offer. Those shares will be locked up for 6 months and will significantly reduce the free float of the stock.
Index inclusions will commence with the HSCI in March 2025 – however, as a stock with Weighted Voting Rights, inclusion in Southbound Stock Connect will only take place in May.

CSI 500 Index Rebalance Preview: 50 Changes; 11% Turnover; US$5bn Round-Trip Trade

With 95% of the review period now complete, we forecast 50 changes (the maximum permitted) for the CSI Smallcap 500 Index at the close on 13 December.
We estimate a one-way turnover of 11% at the rebalance resulting in a one-way trade of CNY17.56bn (US$2.48bn). The Information Technology and HealthCare sectors gain at the expense of Industrials.
After drifting lower over the last couple of months, the forecast adds have outperformed the forecast deletes over the last couple of weeks. There should be more to go here.

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Oct 15

Daily Brief Event-Driven: MBK’s Korea Zinc & Young Poong Precision Tender Results Officially Out and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

MBK’s Korea Zinc & Young Poong Precision Tender Results Officially Out
Korea Value-Up ETFs: Latest Market Info on Initial AUM Setup & Resulting Passive Impacts
Intouch? Or Perhaps “Out Of” Touch
Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: Big Impact and US$3bn Round-Trip Trade
CSI Medical Service Index Rebalance Preview: Four Potential Changes in December
China Resources Beverage (2460 HK) IPO: Index Inclusions & Stock Connect in 2025
Dyna-Mac (DMHL SP): No Alternative As Hanwha Group Bumps
HK Connect SOUTHBOUND Flows (To 14 Oct 2024); A HUGE 5td; Net Flows Strong but BABA Dominant
WisdomTree Oct 24 Emerging Market Rebalance: Top Net Buys and Sells Across DGS, SOE & DEM
A/H Premium Tracker (To 14 Oct 2024): AH Premia Drop Sharply; High Premia May Contract More

MBK’s Korea Zinc & Young Poong Precision Tender Results Officially Out

MBK officially disclosed that they scooped up 5.34% of the Korea Zinc (010130 KS) shares in the tender that wrapped up today.
MBK scored a partial win by securing more voting rights than Choi, with unexpected backing from foreign and local institutions, likely due to proration risk over legal issues.
Still, securing just 5.34% puts MBK in a tough position, requiring them to navigate minority shareholder votes while pushing hard on the legal front to block the buyback.

Korea Value-Up ETFs: Latest Market Info on Initial AUM Setup & Resulting Passive Impacts

KRX will launch 12 ETFs tracking the Korea Value-Up Index on November 4—9 passive and 3 active—aiming for an initial AUM exceeding 1 trillion KRW.
KRX is pressuring ETF operators to reveal initial capital by November 4, with expectations to exceed 1 trillion KRW due to government pressure.
Early signs of position buildup are emerging, so it’s essential to monitor stocks with significant passive impact closely moving forward.

Intouch? Or Perhaps “Out Of” Touch

Intouch (INTUCH TB)‘s strange journey with Gulf Energy (GULF TB) continues. In April 2021, GULF made a surprising VTO for INTUCH. This past July, the two companies announced an amalgamation.
The merger was not fair to INTUCH shareholders, with an estimated earnings value destruction of ~26.5% (for FY24E). But that didn’t stop shareholders overwhelmingly approving the 3rd October EGM resolutions.
What now? The next step is the low-balled VTOs for Advanced Info Service (ADVANC TB) and Thaicom (THCOM TB). Then amalgamation. Then, arguably, the next unorthodox development will take place.

Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: Big Impact and US$3bn Round-Trip Trade

Using data from the close on 11 October, there could be 6 adds and 5 deletes for the Yuanta/P-Shares Taiwan Dividend Plus ETF in December.
There will also be capping and funding flows that will lead to a one-way turnover of 15% and a one-way trade of TWD 49bn (US$1.52bn)
Shorts have been building up in some of the forecast deletes and in a couple of the forecast adds as well.

CSI Medical Service Index Rebalance Preview: Four Potential Changes in December

The review period ends on 31 October, the changes should be announced on 29 November and will be effective after the close of trading on 13 December.
We forecast 4 potential changes for the index in December where there could be buying of 0.5-3x ADV in the adds and selling of between 0.5-1.3x ADV in the deletes.
The forecast adds have drifted lower versus the forecast deletes following the rally in the markets and the large ETF creations. That could reverse from now till review period end.

China Resources Beverage (2460 HK) IPO: Index Inclusions & Stock Connect in 2025

China Resources Beverage (CRB HK) is offering 347.8m shares in its IPO at a price range of HK$13.5-14.5/share. With the overallotment option, the IPO could raise up to HK$5.8bn (US$474m).
Cornerstone investors will take up nearly half the offer. Those shares will be locked up for 6 months and will significantly reduce the free float of the stock.
Index inclusions will commence with the HSCI in March 2025 – that will also result in Stock Connect inclusion. The next index inclusion will take place in June.

Dyna-Mac (DMHL SP): No Alternative As Hanwha Group Bumps

On the 11th September, Hanwha Ocean (042660 KS) and Hanwha Aerospace (012450 KS), collectively holding 25.36%, made a S$0.60/share cash Offer for shares not owned, conditional on a 50% acceptance.
The transaction stalled on the 24th September, when the estate of Dyna-Mac’s founding shareholder, Desmond Lim Tze Jong (holding ~35% currently) reckoned the Offer “does not adequately reflect” Dyna-Mac’s value.
Hanwha Group has now bumped terms by 11.67% to S$0.67/share, best & final. That’s a 35.4% premium to undisturbed, and a decade high. No word, yet, from the Lim estate.

HK Connect SOUTHBOUND Flows (To 14 Oct 2024); A HUGE 5td; Net Flows Strong but BABA Dominant

SOUTHBOUND was a net buyer the last five trading days (from before GW to 14 Oct). HUGE gross flows. Decent net flows. Very big in few names (BABA included).
The Guotai Junnan/Haitong merger pushed H-share brokers hard, but SB wasn’t buying. They bought Alibaba Group Holding (9988 HK), Semiconductor Manufacturing International Corp (SMIC) (981 HK), Xiaomi Corp (1810 HK).
Things may settle down a little bit as the fiscal policy announcements are out of the way, but I expect the trend is still your friend (until it bends).

WisdomTree Oct 24 Emerging Market Rebalance: Top Net Buys and Sells Across DGS, SOE & DEM

By Charlotte van Tiddens, CFA

In this short insight, we include our flow estimates for all additions and deletions taking place in the range of WisdomTree EM Funds at the rebalance this Wednesday (16 October).
We show the top 40 buys and sells across DEM, XSOE and DGS.
The top buys include Chc Resources (9930 TT) & Uchi Technologies (UCHI MK). The top sells include Impack Pratama Industri Tbk (IMPC IJ) and Hap Seng Consolidated (HAP MK).

A/H Premium Tracker (To 14 Oct 2024): AH Premia Drop Sharply; High Premia May Contract More

A big “week” of 5 trading days from 30 Sep to 14 Oct, inclusive. Average AH premia dropped a lot. Liquid AH premia dropped less. Brokers are big winners.
Average AH volatility is super high. Intracorrelation of spreads quite low. Lots of room to market-make wide spreads/high premia. High premia may continue to contract on speculation.
Sharply differing onshore and offshore opinion regarding the nature and vibe of Chinese stimulus will lead to interesting dispersion. Identify the trend, then market make around it.

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Oct 14

Daily Brief Event-Driven: Bain Bids Bigger and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Bain Bids Bigger, Goes Hard on Fuji Soft (9749); I’ve Got 🍿🍿🍿
S&P/ASX Index Rebalance Preview (Dec 2024): Big Impact as Shorts Ramp Up
China ETF Inflows & Implications: YTD Inflows Nearing US$150bn
Fuji Soft (9749 JP): Bain’s Better Late than Never Competing Offer
Merger Arb Mondays (14 Oct) – Haitong/GJTA, GA Pack, Henlius, Canvest, Seven & I, Arcadium Lithium
Quiddity Leaderboard HS Internet & IT: Dec 24 Flow Expectations and Mar 25 Expected ADDs/DELs
EQD / NSE Vol Update / ++Vol-Of-Vol & Unstable Vol-Regime. Structural Changes Unfolding in Vol Mkts?
EQD | Long Nifty 50 Vs. Short Nikkei 225 – A Relative Value Option Strategy with a Kicker

Bain Bids Bigger, Goes Hard on Fuji Soft (9749); I’ve Got 🍿🍿🍿

As they had announced was their intention, Bain has made a binding offer for Fuji Soft Inc (9749 JP), bidding ¥9,450 against KKR’s ¥8,800. They aim to launch late October.
There is no minimum and no maximum. The Founding Nozawa family had thrown their lot in with Bain not KKR and that 18.5% is tied up.
There are conditions, and those are ALL-important. And I expect we see in the next week or so how coercive KKR’s “non-coercive” scheme change was. I’ve got 🍿🍿🍿.

S&P/ASX Index Rebalance Preview (Dec 2024): Big Impact as Shorts Ramp Up

With three quarters of the review period complete, there could be one change for the S&P/ASX 50 Index and two changes for the S&P/ASX 200 (AS51 INDEX) in December.
There are two stocks that could be deleted from global indexes in November and that could keep those names under pressure for the next few weeks.
Passive trackers will need to buy between 4-5x ADV in the forecast adds and sell between 2-8x ADV in the forecast deletes. Shorts have been building up in some names.

China ETF Inflows & Implications: YTD Inflows Nearing US$150bn

Nearly US$140bn has flowed into mainland China listed ETFs year to date and there have been big creations in the last few weeks as stocks have surged.
97% of all inflows are in ETFs benchmarked to the CSI300, CSI1000, CSI500, SSE50, ChiNext and STAR50 indices. But over US$4bn has gone into other ETFs in the last week.
The large ETF inflows over the last few weeks has led to index rebalance strategies underperforming in China. But that should reverse from now to rebalance implementation.

Fuji Soft (9749 JP): Bain’s Better Late than Never Competing Offer

Bain’s pre-conditional tender offer for Fuji Soft Inc (9749 JP) is JPY9,450, a 7.4% premium to KKR’s JPY8,800 offer. There is no minimum or maximum acceptance condition.
The preconditions relate to regulatory approval (Vietnam) and Board recommendation. Bain’s offer is designed to bring KKR to the negotiating table to find a solution to privatisation.
KKR can 1) do nothing, 2) work with Bain on a solution, or 3) engage in a price war to prevent the satisfaction of Bain’s Board recommendation precondition.

Merger Arb Mondays (14 Oct) – Haitong/GJTA, GA Pack, Henlius, Canvest, Seven & I, Arcadium Lithium

We 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 Seven & I Holdings (3382 JP), Shanghai Henlius Biotech (2696 HK), Canvest Environmental Protection Group (1381 HK), Haitong Securities Co Ltd (H) (6837 HK), Shinko Electric Industries (6967 JP).
Lowest spreads: Dyna Mac Holdings (DMHL SP), Xingda International (1899 HK), Fuji Soft Inc (9749 JP), Trancom Co Ltd (9058 JP), Descente Ltd (8114 JP), T Gaia Corp (3738 JP).

Quiddity Leaderboard HS Internet & IT: Dec 24 Flow Expectations and Mar 25 Expected ADDs/DELs

The Hang Seng Internet & IT (HSIII) index represents the top 30 stocks related to internet and information technology businesses listed in Hong Kong (HKEX).
In this insight, we take a look at our capping flow expectations for the December 2024 index rebal event.
We have also presented our index change expectations for the next semiannual index review which will take place in March 2025.

EQD / NSE Vol Update / ++Vol-Of-Vol & Unstable Vol-Regime. Structural Changes Unfolding in Vol Mkts?

By Sankalp Singh

Options Markets expected risk sentiment to deteriorate further – IVs were elevated. But lack of RV follow through caused sharp markdowns, especially for short-dated contracts.
Increased Vol-of-vol has triggered multiple switches in Vol Regime Model – currently in “High & Down” vol-state. Multiple state-switches indicative of unfolding structural changes in Vol Markets.
Smile looking overly compressed in Monthly & Quarterly contracts as OTM Strangles trade close to par with ATMs.

EQD | Long Nifty 50 Vs. Short Nikkei 225 – A Relative Value Option Strategy with a Kicker

By Gaudenz Schneider

This strategy exploits relative value in implied volatilities and combines it with a long Nifty 50 vs. short Nikkei 225 directional view over a period of two months.
The strategy performs well if the Nifty 50 rises and outperforms the Nikkei 225. If both indices decline, neither profit nor loss is incurred.
Leverage increases both the strategy’s payoff and probability of success.

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Oct 13

Daily Brief Event-Driven: Korea Zinc: Latest Stockholder Record for Proration Risk and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Korea Zinc: Latest Stockholder Record for Proration Risk
China Healthcare Weekly (Oct.13)-Genor to Acquire Edding, RemeGen’s Bleak Outlook, Zai Lab’s Trouble
(Mostly) Asia-Pac M&A: Rio/Arcadium, Seven & I, Pacific Smiles, China TCM, Korea Zinc
Last Week in Event SPACE: Guotai/Haitong, Shin Kong, China Conch Ventures, First Pac, Zhejiang E’way
Quiddity Leaderboard Hang Seng Biotech Dec 24: Two Changes Expected + Capping Flows

Korea Zinc: Latest Stockholder Record for Proration Risk

If NPS and passive funds each tender half, it could hit 24%, pushing investors to consider both sides. The market’s eyeing a ratio of about MBK 3 to Choi 7.
This tight vote could drag out the event longer than expected, and MBK might scoop up more shares if they miss their minimum target.
MBK will likely go for open market buys against Korea Zinc’s buyback. Consider tendering to MBK Monday and spread trading futures, or push Korea Zinc to raise their buyback offer.

China Healthcare Weekly (Oct.13)-Genor to Acquire Edding, RemeGen’s Bleak Outlook, Zai Lab’s Trouble

By Xinyao (Criss) Wang

Leading Chinese biotech firms are among the few sub-sectors sustaining rapid growth. However, RemeGen stands as a negative example, with its business model and investment rationale proving flawed.
“Increasing revenue without increasing profits” is actually a “denial” of a company’s business model. Even though the losses decreased in 24H1, this doesn’t change our negative expectations for Zai Lab.
Genor Biopharma and Edding Group are merging through a reverse takeover, benefiting both companies by boosting Genor’s valuation and allowing Edding to achieve its goal of going public.

(Mostly) Asia-Pac M&A: Rio/Arcadium, Seven & I, Pacific Smiles, China TCM, Korea Zinc

I tally 45 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
Two new deals discussed this week: Rio Tinto (RIO AU)‘s tilt for Arcadium Lithium (LTM AU), and the Guotai Junan Securities (2611 HK)/Haitong Securities (H) (6837 HK) merger.
Key updates took place on: Seven & I Holdings (3382 JP), Pacific Smiles (PSQ AU), China Traditional Chinese Medicine (570 HK) and Korea Zinc (010130 KS).

Last Week in Event SPACE: Guotai/Haitong, Shin Kong, China Conch Ventures, First Pac, Zhejiang E’way

The Guotai Junan Securities (2611 HK)/Haitong Securities Co Ltd (H) (6837 HK) merger is a done deal. The key risk, as withTCM (570 HK)‘s Offer, is one of timing.
IF you are an arbitrageur, Buy Shin Kong Financial Holding (2888 TT) vs A Basket of FHC Peers (not including Taishin).
First Pacific Co (142 HK)‘s 46.2% share of Metro Pacific Investments Co (MPI PM)at delisting last year was worth ~US$1.25bn. It is now potentially worth ~US$3.21bn.

Quiddity Leaderboard Hang Seng Biotech Dec 24: Two Changes Expected + Capping Flows