In today’s briefing:
- [Japan M&A] Mandom (4917 JP) MBO – Light Price, Open-Ish Register, Tough to Take Over, Could Do Fun
- Evergrande Property Services (6666 HK): Offer Expected As Parent (Likely) Exits
- Jilin Jiutai Bank (6122 HK): Take The Offer. It Is What It Is
- Fuji Oil (5017 JP): Idemitsu Kosan (5019 JP)’s Tender Offer at JPY480
- Evergrande Services (6666 HK): Liquidation of Evergrande’s Stake to Trigger an Unconditional MGO?
- [Japan M&A] Digital HD (2389 JP) MBO Takeunder Is Optically Bad, A Little Light, But Tough to Beat
- Evergrande Property Services (6666 HK): Liquidators’ Auction
- DB Hitek: Treasury Shares Cancellation, EB Issue, and Employees Equity Compensation
- Tega Industries Ltd: Leap into the Global Big League with Molycop Acquisition
- Asian Energy-Oilmax Merger: From Service Provider to Integrated Energy Player?
[Japan M&A] Mandom (4917 JP) MBO – Light Price, Open-Ish Register, Tough to Take Over, Could Do Fun
- On 10 September, the founding Nishimura family, the PE Firm CVC, and Mandom Corp (4917 JP) agreed that the first two could take over the latter at 4.9x Mar28 EBITDA.
- A cocktail napkin calculation of expected leverage suggests the equity check is buying this at 5x average Mar27-28 free cash flow. That’s cheap for a growing company.
- The register is open enough to cause problems but not open enough to allow a clean hostile bid by a strategic. But still open enough for someone to have fun.
Evergrande Property Services (6666 HK): Offer Expected As Parent (Likely) Exits
- Property management play Evergrande Property Services (6666 HK) (EPS) is currently suspended pursuant to the Takeovers Code.
- Evergrande (3333 HK) controls 51.71%. This suspension is either a precursor to a Scheme; or (more likely) cash-strapped Evergrande is exiting, potentially triggering an unconditional MGO.
- Evergrande, currently in liquidation, was delisted from the HKEx on the 25th August 2025 after failing to fulfil HKEx resumption guidance. The delisting was arguably symbolic, but remains a milestone.
Jilin Jiutai Bank (6122 HK): Take The Offer. It Is What It Is
- Back on the 3rd July 2025, Jilin Province Trust must a voluntary Offer at HK$0.70/share (~0.23x P/B!!) for troubled rural commercial bank Jilin Jiutai Rural Comm Bank (6122 HK).
- Shares have been suspended since 12th March. Jilin Jiutai have yet to publish their 2024 annual results. It’s doubtful shares will resume trading. Ever.
- The Composite Doc Booklet is now out, with a H-share class meeting on the 24th October, the same day as the first close. The IFA (Gram) says “fair & reasonable“.
Fuji Oil (5017 JP): Idemitsu Kosan (5019 JP)’s Tender Offer at JPY480
- Fuji Oil Co Ltd (5017 JP) has recommended a tender offer from Idemitsu Kosan (5019 JP) at JPY480, a 44.1% premium to the last close.
- While the offer implies a P/B of 0.54x, it is reasonable as it is above the midpoint of the IFA DCF valuation range and at a premium to historical ranges.
- Nevertheless, the offer is susceptible to a bump as it is far from a knockout bid, and Fuji Oil previously had activists on the register.
Evergrande Services (6666 HK): Liquidation of Evergrande’s Stake to Trigger an Unconditional MGO?
- Evergrande Property Services (6666 HK) is in a trading halt “pending the release of an announcement pursuant to the Code on Takeovers and Mergers which contains inside information of the Company.”
- The trading halt likely relates to Evergrande (3333 HK) liquidators’ efforts to sell Evergrande Group’s majority interest in Evergrande Services.
- The sale is likely to trigger an unconditional mandatory general offer. I estimate the potential offer price to be around HK$1.08 per share, a 17.8% premium to the last close.
[Japan M&A] Digital HD (2389 JP) MBO Takeunder Is Optically Bad, A Little Light, But Tough to Beat
- On 11 Sep 2025 after the close, Hakuhodo Dy Holdings (2433 JP) announced a takeunder of Digital Holdings Inc (2389 JP) in MBO form.
- Two major holders with 37% roll their stakes into new ownership in Hakuhodo Dy Holdings (2433 JP) and another 17+% probably just fall in line.
- Foreigners hold a lot. They may not like the takeunder. It is not clear who would buy this if Hakuhodo does not, or whether it is worth the hassle.
Evergrande Property Services (6666 HK): Liquidators’ Auction
- In Evergrande Property Services (6666 HK): Offer Expected As Parent (Likely) Exits., I speculated on the outcome of Evergrande Property Services (6666 HK) (EPS)’s suspension due to the Takeovers Code.
- EPS has now announced that the liquidators for Evergrande (3333 HK) have been fielding non-binding Offers for Evergrande’s 51.016% stake in EPS. Final proposals are expected to be submitted by November.
- With a view to maximizing proceeds, the liquidators will ideally seek a sole bidder, leading to a change of control. And an unconditional MGO. Shares resume trading this morning.
DB Hitek: Treasury Shares Cancellation, EB Issue, and Employees Equity Compensation
- DB Hitek announced a detailed plan for its 4.16 million treasury shares utilization (9.4% of outstanding shares), including shares cancellation, issuance of exchangeable bonds, and equity compensation for its employees.
- There will be 2.22 million treasury shares that will be used in the issuance of EBs. This represents 54% of the total treasury shares and 5% of outstanding shares.
- The company also plans to cancel 1.486 million treasury shares (representing 35.7% of treasury shares and 3.3% of outstanding shares).
Tega Industries Ltd: Leap into the Global Big League with Molycop Acquisition
- Tega Industries has announced its intent to acquire a controlling stake in Molycop at a USD 1.48 billion enterprise value, in consortium with Apollo Funds.
- The deal is nearly 10x Tega’s size, and will redefine its global positioning across the mining consumables and equipment value chain.
- Integration risks loom large, but if executed well, this move transforms Tega from a niche Indian export champion into a global leader in mineral processing solutions.
Asian Energy-Oilmax Merger: From Service Provider to Integrated Energy Player?
- Asian Energy Services (AOS IN) has received board approval for the merger of promoter entity Oilmax Energy, with share swap ratio: 117 shares of AESL for 10 shares of Oilmax.
- The merger is a strategic move to consolidate OEPL’s asset ownership, including producing oil and gas fields, with AESL’s execution and services capabilities.
- The valuation of the parent company is looking costlier, and a reduction in promoter stake makes things skeptical in transaction.
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