In today’s briefing:
- [Japan M&A] Possible Partial TSURUHA (3391 JP) Tender Changes – More Accretion! Smaller Tender?
- African Gold Ltd (A1G AU) Enters Scheme With Montage Gold (MAU CN)
- Venus Metals Faces Hostile Takeover Bid from QGold Amid Potential for Higher Offers and Asset Valuation Discrepancies
- Fast Fitness Japan (7092 JP): JGIA-Sponsored MBO Is a Done Deal
- Active Merger Arbitrage and Privatization Opportunities: Strategic Reviews, Buyouts, and More
- Zegona Communications: From Turnaround to Capital Return Vehicle with M&A Optionality
- Genting Malaysia (GENM MK): Offer Closes As New York Casino Licence Awarded
- Sell Millrose Properties
- Strategic Buyouts, Mergers and Arbitrage: Analyzing Active Portfolio Ideas
- Thunderbird Entertainment’s Acquisition by Blue Ant Media: Merger Arbitrage Opportunity
[Japan M&A] Possible Partial TSURUHA (3391 JP) Tender Changes – More Accretion! Smaller Tender?
- Today, post-close of its first day of trading as MergeCo, Tsuruha Holdings (3391 JP) announced 12 different investors who had voted against the deal filed for dissenting shareholder share repurchase.
- This covers 27.154mm shares – a bit more than what Orbis owned when they last filed (25.5mm shs) and is just over half the AGM dissension.
- This creates some weirdness. A 5+% buyback is strong accretion, but “fair price” is a question, and it could mean smaller tender offer quantity and larger eventual index selldowns.
African Gold Ltd (A1G AU) Enters Scheme With Montage Gold (MAU CN)
- The gold rush continues with another Canadian outfit bidding to take over an Aussie-listed West African gold play.
- Junior miner African Gold (A1G AU)has entered into a Scheme with Montage Gold (MAU CN). African Gold shareholders will receive 0.0628 new MAU shares for every A1G share.
- That backs out an implied value of A$0.50/share. Independent directors, holding 11.6% of shares out, are supportive. Montage holds 17.3%. Clean deal.
Venus Metals Faces Hostile Takeover Bid from QGold Amid Potential for Higher Offers and Asset Valuation Discrepancies
- QGold’s hostile takeover offer for Venus Metals at A$0.17/share is expected to increase, with VMS stock trading at A$0.195/share.
- VMC’s assets in Rox Resources are valued at A$46m, with a 1% net smelter royalty potentially undervalued due to outdated assumptions.
- Christopher Wallin’s QGold has acquired a 26% stake in VMC and a 9% stake in Rox Resources, indicating strategic interest.
Fast Fitness Japan (7092 JP): JGIA-Sponsored MBO Is a Done Deal
- Fast Fitness Japan Inc (7092 JP) has recommended a JGIA-sponsored MBO at JPY2,315, a 29.3% premium to the undisturbed price (31 October).
- There was media speculation about a tender offer last month. The offer is arguably light as it is below the mid-point of the IFA DCF valuation range.
- This is a done deal as the irrevocables to tender (20.65% ownership ratio) exceed the lower limit of the tender offer (17.12% ownership ratio).
Active Merger Arbitrage and Privatization Opportunities: Strategic Reviews, Buyouts, and More
- Priority Technology received a non-binding privatization offer from its founder at $6-$6.15/share, with a 11%-14% spread.
- Generation Bio completed restructuring, now a cash shell with net cash at $7.6/share, 50% above current price.
- Sotherly Hotels’ preferred shares trade with a 12-14% spread to offer price, common shares at 5% spread.
Zegona Communications: From Turnaround to Capital Return Vehicle with M&A Optionality
- Zegona has unlocked €1.8bn via fiber monetization, enabling a €1.6bn capital return and transforming its balance sheet with 69% share count reduction and lower leverage.
- Trading at ~6.7x EBITDAaL, Zegona offers embedded upside through strategic rerating or a control premium from Telefónica or MasOrange, both reportedly exploring bids.
- Post-Buyback, per-share economics improve dramatically, with lower debt, rising EBITDA, and potential for further upside via fiber JVs or a formal takeover process.
Genting Malaysia (GENM MK): Offer Closes As New York Casino Licence Awarded
- Genting Bhd (GENT MK)‘s unconditional Offer for Genting Malaysia (GENM MK) closed yesterday, the 1st December, with GENT holding 73.13%, up from 49.99% initially.
- The IFA previously opined the Offer to be NOT fair, and NOT reasonable. A bump in terms, long rumoured, failed to unfold.
- Yesterday, GENM was one of three applicants selected by New York’s Gaming Facility Location Board for a full commercial casino license in downtown New York.
Sell Millrose Properties
- I’m closing out my LEN/MRP odd lot trade recommendation and will be selling my MRP shares.
- The total return if you took advantage of the odd lot provision was +1.9% / + $235 less than the expected return of +6.4% / $772.
- The driver of the underperformance? MRP sold off in mi- November given market weakness and hasn’t fully recovered.
Strategic Buyouts, Mergers and Arbitrage: Analyzing Active Portfolio Ideas
- KNOT Offshore Partners received a $10/unit take-private offer; potential for improved bid due to unitholder approval requirement.
- Golden Entertainment’s chairman offers at 1x EBITDA; shareholder approval could lead to a 15%+ price increase.
- TrueCar’s founder-led buyout at $2.55/share; 26% shareholder support; deal expected to close by early 2026.
Thunderbird Entertainment’s Acquisition by Blue Ant Media: Merger Arbitrage Opportunity
- Thunderbird Entertainment is being acquired by Blue Ant Media for C$1.77/share in cash and 0.2165 BAMI shares.
- Voss Capital and other major holders, owning 37% of TBRD, support the transaction requiring two-thirds vote approval.
- The offer implies a 3.4x FY26 EBITDA multiple, dropping to 2.6x with expected C$7m synergies.
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