In today’s briefing:
- Merger Arb Mondays (13 Oct) – Dongfeng, Hang Seng, Soft99, Toyota Industries, Pacific Ind, Mandom
- Kangji Medical (9997 HK): 10th Nov Shareholder Vote on Founders/TPG/QIA’s Offer
- Advent × U-Blox — 64.64% Vs 66⅔%; Watch Oct 15
- Eramet (ERA FP) SLB: Trade the Metals Event-Carry Window
- RPMGlobal (RUL AU): Caterpillar Firms A$5/Share Offer
Merger Arb Mondays (13 Oct) – Dongfeng, Hang Seng, Soft99, Toyota Industries, Pacific Ind, Mandom
- I 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: Smart Share Global (EM US), Mayne Pharma (MYX AU), ENN Energy (2688 HK), Soft99 Corp (4464 JP), Dongfeng Motor (489 HK), Joy City Property (207 HK).
- Lowest spreads: Bright Smart Securities (1428 HK), Pacific Industrial (7250 JP), Mandom Corp (4917 JP), Humm Group (HUM AU), Ainsworth Game Technology (AGI AU), Seven West Media (SWM AU).
Kangji Medical (9997 HK): 10th Nov Shareholder Vote on Founders/TPG/QIA’s Offer
- On the 12th August, Hangzhou Kangji Medical (9997 HK) announced an Offer, by way of a Scheme, from a consortium led by TPG and Qatar Investment Authority, together with the founders.
- The HK$9.25/share consideration price (declared final), was an lacklustre 9.9% premium to last close. But pitched around a four-year high.
- The Scheme Document is now out, with a Court Meeting on the 10th November and expected payment around the 16th December – in line with my expectations.
Advent × U-Blox — 64.64% Vs 66⅔%; Watch Oct 15
- Provisional acceptance 64.64%, below 66⅔% minimum; ~155,900 shares short. Definitive interim due 15 Oct; Advent may secure additional tenders or buy stock under Swiss rules.
- If threshold met, residual carry modest at CHF 133.8 close; if not, offer lapses and shares likely revert toward standalone value pending any revised Advent approach.
- Positioning: stay light and tactical until 15 Oct print; monitor block trades/irrevocables; interloper risk low, re-bid or bump more plausible path than competing strategic bid.
Eramet (ERA FP) SLB: Trade the Metals Event-Carry Window
- Trade call: Long the 2028 SLB for a likely step-up from at latest May 22, 2026, hedge duration, exit post vendor field updates in May 2026.
- Probability of rate step-up: Single KPI miss and step-up path most likely, with intensity tight and engagement near threshold, optionality crystallizes into tactical carry, not credit stress.
- Catalyst path: Step-up mechanics, assurance, and vendor field updates create a defined trading window, see uplifted coupon count and cash cost below.
RPMGlobal (RUL AU): Caterpillar Firms A$5/Share Offer
- RPMGlobal Holdings Limited (RUL AU), a mining software technology provider, has entered into a Scheme with Caterpillar Inc (CAT US).
- Caterpillar, which currently holds no shares in RPMGlobal, is offering A$5/share (the same as in the NBIO), a 32.8% premium to undisturbed. Terms have not been declared final.
- FIRB and ACCC approvals are conditions. FIRB won’t be an issue. The key ACCC question is whether the combo has significant direct market overlap that triggers substantial competition concerns.
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