In today’s briefing:
- Merger Arb Mondays (09 June) – Mayne, Tam Jai, OneConnect, Toyota Industries, Makino, Fuji Corp
- [Japan M&A] Private Co Takeout of Fuji Corp (7605 JP) – A Done Deal
- Fuji Corp (7605 JP): Usami Koyu’s JPY2,830 Tender Offer Is Light but Done
- Weekly Deals Digest (08 Jun) – Toyota Industries, Makino, Fuji Corp, Tam Jai, PointsBet, Mayne
- KTM Saga, Short Bajaj Auto – There’s a Lot to Chew On
- SSI Newsletter: New Portfolio Ideas, Guest Pitches, and Key Updates
- Weekly Update (MEDXF, IDT, FTV)
Merger Arb Mondays (09 June) – Mayne, Tam Jai, OneConnect, Toyota Industries, Makino, Fuji Corp
- 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: Mayne Pharma (MYX AU), Insignia Financial (IFL AU), Fuji Corp (7605 JP), ENN Energy (2688 HK), Smartpay Holdings (SPY NZ), Seven & I Holdings (3382 JP).
- Lowest spreads: Bright Smart Securities And (1428 HK), Toyota Industries (6201 JP), Dada Nexus (DADA US), Avjennings Ltd (AVJ AU), Nissin Corp (9066 JP), Torii Pharmaceutical (4551 JP).
[Japan M&A] Private Co Takeout of Fuji Corp (7605 JP) – A Done Deal
- The long-term major owner now chairman is getting out. The company was shopped. And bought. And this is the deal. ¥2,830 which is about 5.7x this year’s EBITDA.
- It could have been done a bit better, but irrevocables are 48.5% out of the 50.01% minimum and other directors get this past the minimum hurdle.
- Transparency is lacking but it is an all-time high and you can’t do much about it.
Fuji Corp (7605 JP): Usami Koyu’s JPY2,830 Tender Offer Is Light but Done
- Fuji Corp (7605 JP) has recommended a tender offer from Usami Koyu at JPY2,830, a 32.2% premium to the last close price.
- Unusually for a Board recommended offer, the lower limit will not achieve a 66.67% ownership ratio. Based on past EGM voting ratios, it is set at a 50.01% ownership ratio.
- While the offer represents an all-time high, it is below the midpoint of the IFA DCF valuation range. However, due to irrevocables, this is a done deal.
Weekly Deals Digest (08 Jun) – Toyota Industries, Makino, Fuji Corp, Tam Jai, PointsBet, Mayne
- 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: Foshan Haitian Flavouring & Food (603288 CH) has filed its PHIP for an H Share listing to raise US$1 billion.
- Event-Driven developments: Toyota Industries (6201 JP), Makino Milling Machine Co (6135 JP), Fuji Corp (7605 JP), Tam Jai International (2217 HK), PointsBet Holdings (PBH AU), Mayne Pharma (MYX AU).
KTM Saga, Short Bajaj Auto – There’s a Lot to Chew On
- We cover the multiple factors which led to the operational and financial mess at Pierer Mobility AG, the holding company of KTM.
- This insight highlights the past not so great track record of Indian companies acquiring European businesses due to cultural, operational integration and higher restructuring costs.
- Bajaj Auto Ltd (BJAUT IN) remains strong domestically, but KTM’s losses, debt, and integration hurdles risk compressing margins and return ratios at the consolidated level. We recommend Shorting Bajaj Auto.
SSI Newsletter: New Portfolio Ideas, Guest Pitches, and Key Updates
- New portfolio ideas include Lutnick’s SPACs CEPO/CEPT with potential multibagger upside and MYX:AX’s merger arb with Cosette Pharmaceuticals.
- Guest pitches highlight potential takeover of Webjet Group, Naturgy’s odd-lot tender offer, and Assura’s bidding war interest.
- Updates cover LWAY’s board overhaul, LQDA’s patent lawsuit denial, RTACU’s unit separation, NZM’s strategic review, OCFT’s document delay, and PAC’s short report on ABL.
Weekly Update (MEDXF, IDT, FTV)
Fortive (FTV) will spin off 100% of Ralliant on June 28, 2025.
Ralliant will trade under the ticker RAL. When issued trading will begin on June 25th. Ralliant will host an investor day on June 10, 2025.
Ralliant (Precision Technologies) will be a $2.2B revenue company (2024) focused on Test & Measurement and Sensors & Safety Systems.
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