In today’s briefing:
- Lee Jae-Myung’s Camp Just Dropped Their Latest Market Stimulus Play
- Dada Nexus (DADA US): Takeaways from the 13E-3 Filing
- HMM’s 2T KRW Buyback Tender to Drop Before June End
- Swiggy (SWIGGY IN): US$7.6bn Lock-Up Expiry & Index Inclusion
- Event Driven: Jubilant Agri & Consumer Products Demerger- Next Value Creator from the Bhartia Group?
- SSI Weekly Highlights: Tender Offers, Buyouts, Liquidations, and Strategic Acquisitions in Focus
- Weekly Update (ABB, MEDXF, LION)
Lee Jae-Myung’s Camp Just Dropped Their Latest Market Stimulus Play
- They’re making it easier to spot stocks benefiting from policy shifts. Lee Jae-myung’s camp is giving more detail upfront, with a focus on FuriosaAI and related listed stocks.
- If cumulative voting passes, expect a pop in stocks with governance issues, activist interest, or large NPS stakes, like Hyosung affiliates, Doosan, HL Mando, and POSCO Holdings.
- They also aim to give parent shareholders first crack at spun-off subsidiaries going public and require buyback cancellations, likely benefiting SK and LS Group affiliates, Samsung Electronics, and POSCO Holdings.
Dada Nexus (DADA US): Takeaways from the 13E-3 Filing
- Dada Nexus (DADA US) has filed the 13E-3 relating to the binding proposal from JD.com Inc (ADR) (JD US) at US$2.00 per ADS, a 41.8% premium to the undisturbed price.
- The 13E-3 filing provides more details on the price negotiations, required regulatory approvals and IFA valuation. Crucially, no Chinese regulatory approvals are required.
- The completion conditions are low-risk. At last close and for an end-September payment, the gross/annualised spread is 5.4%/12.1% (including the US$0.05 ADS cancellation fee).
HMM’s 2T KRW Buyback Tender to Drop Before June End
- This buyback facilitates KDB’s exit, as rules prevent a block trade benefiting one shareholder. KDB plans to tender a 4–5% stake, or about 40% of the 2 trillion KRW buyback.
- Given HMM’s tight float, the premium is likely above the usual 10%, making it a strong opportunity for short-term arbitrage trading.
- The key is timing the announcement. With the June deadline, we need to monitor hot money flows into HMM to build our position before the news breaks.
Swiggy (SWIGGY IN): US$7.6bn Lock-Up Expiry & Index Inclusion
- Swiggy (SWIGGY IN) listed in November 2024 and around 85% of the shares outstanding (US$7.6bn) will unlock on 13 May.
- Nearly 80% of the shares that unlock are held by pre-IPO PE/VC investors and they are 100% in the money in most cases. Expect the selldown to commence soon.
- Swiggy (SWIGGY IN) should be added to one global index in June, while inclusion in the other global index will require a small price increase or selling from PE/VC investors.
Event Driven: Jubilant Agri & Consumer Products Demerger- Next Value Creator from the Bhartia Group?
- Separation of fertilizer division enables sharper valuation for adhesives, removing drag from losses and unlocking pure-play growth potential.
- High growth with underpriced products; margin expansion likely as brand strength builds, closing gap with Pidilite and Jyoti Resins.
- Once loss-making agri business now EBIT-positive; post-demerger focus may revive segment and surprise on valuations.
SSI Weekly Highlights: Tender Offers, Buyouts, Liquidations, and Strategic Acquisitions in Focus
- Naturgy Energy Group plans a tender offer to repurchase 9% of shares at €26.50/share, with potential upside due to Spanish proration rules.
- Lensar is being acquired by Alcon for $14/share plus a CVR up to $2.75/share, with shareholder approval likely.
- OCI N.V. announced a $1bn cash distribution and potential future dividends, raising net cash estimates to €9.19/share.
Weekly Update (ABB, MEDXF, LION)
- April 17, 2025, ABB Ltd (ABB) announced its intention to spin off its entire robotics division.
- The robotics unit, recognized as the world’s second-largest industrial robot manufacturer after Japan’s FANUC, generated $2.3 billion in revenue in 2024, accounting for approximately 7% of ABB’s total sales.
- However, its profit margin stood at 12.1%, trailing the group’s overall margin of 18.1%, primarily due to subdued demand in the automotive sector.
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