In today’s briefing:
- Tam Jai (2217 HK): Anxiety Creeps in Ahead of the Scheme Document
- Tam Jai (2217 HK): Toridoll (3397 JP)’s Excellent Offer. Still.
- Ola Electric: Hyundai Exits Amid Slowing Sales, Delayed Cells and Fundraising Plans.
- Yutori Doubles Sales Again
- LE: 1Q Review: Holding the Course in Rough Waters; Reiterate Buy, $20 PT
- What the Tokyo Market Needs Is a Metabolism and Replacement with Motivated Managers
Tam Jai (2217 HK): Anxiety Creeps in Ahead of the Scheme Document
- The spread to TORIDOLL Holdings Corporation (3397 JP)’s HK$1.58 offer for Tam Jai International (2217 HK) has risen to 9.7% ahead of the scheme document’s release.
- Several readers have asked whether the Tam Jai offer will mirror the Goldlion and Soundwill deal break. The schemes share similarities but are also different in several ways.
- The scheme’s vote risk has undoubtedly increased partly due to the recent 2025 results and deal breaks. This situation warrants a safety-first approach.
Tam Jai (2217 HK): Toridoll (3397 JP)’s Excellent Offer. Still.
- On the 17th Feb, a specialty restaurant-operator Tam Jai (2217 HK) announced an Offer, by way of a Scheme, from TORIDOLL (3397 JP) at HK$1.58/share, a 75.56% premium to undisturbed.
- This should get up; but really, given the recent Soundwill Holdings (878 HK) and Goldlion Holdings (533 HK) failures, small, illiquid arbs are not the preferred haven for arb investors.
- The Scheme Doc is now out, with a Court Meeting on the 30th June, and payment on or before the 26 August. The IFA (Lego Corporate) says “fair & reasonable“.
Ola Electric: Hyundai Exits Amid Slowing Sales, Delayed Cells and Fundraising Plans.
- Hyundai Motor (005380 KS) and Kia Corp (000270 KS) have exited their investment in Ola Electric through a combined stake sale worth USD80 million, at a discount to market prices.
- The exit marks the end of their 2019 investment in the then-unlisted 2W EV startup and highlights rising investor concerns over Ola Electric’s growth trajectory and operational challenges.
- Ola Electric had listed less than a year ago with bullish growth projections, but the stock is down 34% from the issue price and 63% from post-IPO high prices.
Yutori Doubles Sales Again
- Yutori is still a small business but is sometimes dubbed the Zozo of youth fashion, which is probably why Zozo bought a share in the online mall.
- And it’s proving a good bet, with sales doubling last year and a lot more expansion to come.
- Thanks in part to investment in retail stores but also its uncanny ability to spot youth trends.
LE: 1Q Review: Holding the Course in Rough Waters; Reiterate Buy, $20 PT
- We are reiterating our Buy rating and $20 price target for Lands’ End and leaving our projections for the remainder of FY25 and FY26 basically unchanged after the company reported inline 1Q EPS, but revenue and EBITDA at the lower end of their guidance and below Street expectations.
- That said, given the shift to higher licensing revenue (up 60%), the overall 1Q YoY revenue decline of 8.5%, with gross margins rising 210 bp, was not a material surprise.
- Management reiterated FY25 guidance, as the company has mitigated the impact of tariffs and is focused on continuing to drive higher overall returns via increased licensing, lower inventories and discounting and shifting the customer base to a younger group focused on solutions for their lifestyle.
What the Tokyo Market Needs Is a Metabolism and Replacement with Motivated Managers
- The background for raising the maintaining listing criteria was that the current criteria are loose and that many companies aren’t motivated to grow because they consider IPO to be goal.
- Too long time horizons and previous listing maintenance criteria that might have been manageable did not create a sense of urgency for the company to grow.
- There’s concern that quality of standard market, to which companies that fail the criteria migrate, will deteriorate, and the entire market will need metabolism and replacement of management through M&A.
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