In today’s briefing:
- Merger Arb Mondays (23 June) – ENN Energy, Dickson, HKBN, Mayne, Insignia, Santos, Smartpay
- Hygon/Sugon Merger: BIG Index Flows on Completion
- Korea Holdco Rerating Pullback Risk: No Retroactive Treasury Cancellation
- PointsBet (PBH AU): Betr’s “Superior Offer”? In An Alternate Reality
- Weekly Deals Digest (22 Jun) – Santos, PointsBet, Mayne, HKBN, Carta, Nakano, Sanhua, FWD, CaoCao
- Smartpay (SPY NZ/SMP AU) Enters Into Scheme With Shift4
- HK Connect SOUTHBOUND Flows (To 20 June 2025); Net Buying, Volumes Up, TECH Down, BANKS Bought
- Weekly Update (AMRZ, LION, FTV)
Merger Arb Mondays (23 June) – ENN Energy, Dickson, HKBN, Mayne, Insignia, Santos, Smartpay
- 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), ENN Energy (2688 HK), Smartpay Holdings (SPY NZ), Seven & I Holdings (3382 JP), Santos Ltd (STO AU).
- Lowest spreads: Bright Smart Securities And (1428 HK), Ascentech KK (3565 JP), Brickworks Ltd (BKW AU), Toyota Industries (6201 JP), Avjennings Ltd (AVJ AU), Hainan Meilan International Airport (357 HK).
Hygon/Sugon Merger: BIG Index Flows on Completion
- On 26 May, Hygon Information Technology (688041 CH) and Dawning Information Industry (603019 CH) announced a merger in a sign of consolidation in China’s chipmaking industry.
- For each share of Dawning held, shareholders will receive 0.5525 shares of Hygon. With uncertainty on the timeline for merger completion, Dawning is trading at a 10% discount.
- On completion of the merger, passive trackers will need to buy over US$1.1bn of Hygon Information Technology C (688041 CH) with nearly of that from local index trackers.
Korea Holdco Rerating Pullback Risk: No Retroactive Treasury Cancellation
- Mandatory treasury cancellation isn’t in the current bill, but FSC and MOJ have started internal reviews; enforcement decree could drop as early as Q4.
- An internal policy paper suggests mandatory cancellation will apply only to newly acquired treasury shares, with tight limits on existing ones to curb owner control abuse.
- Lack of retroactive cancellation weakens the bull case, and while holdco sentiment stays upbeat, momentum may fade, opening the door to a tactical pullback.
PointsBet (PBH AU): Betr’s “Superior Offer”? In An Alternate Reality
- BETR Entertainment (BBT AU) has now tabled an all scrip off-market offer for PointsBet (PBH AU) – no minimum acceptance condition – which they consider superior to MIXI (2121 JP)‘s.
- Really? 3.81 new betr shares is currently equivalent to A$1.143/share versus MIXI’s A$1.20/share all-cash Offer. Terms backed out just A$1.086/share at the start of trading last Friday.
- PointsBet quite rightly states the obvious – betr’s Offer is materially below MIXI’s.
Weekly Deals Digest (22 Jun) – Santos, PointsBet, Mayne, HKBN, Carta, Nakano, Sanhua, FWD, CaoCao
- 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: Zhejiang Sanhua Intelligent Controls (2050 HK) H share listing and CaoCao (2643 HK) and FWD Group Holdings (FWD HK) IPOs.
- Event-Driven developments: Santos Ltd (STO AU), PointsBet Holdings (PBH AU), Mayne Pharma (MYX AU), HKBN Ltd (1310 HK), Ascentech KK (3565 JP), Carta Holdings, Inc. (3688 JP).
Smartpay (SPY NZ/SMP AU) Enters Into Scheme With Shift4
- Eftpos terminal provider Smartpay Holdings (SPY NZ/SMP AU) has now entered into a Scheme Implementation Deed with Shift4 Payments (FOUR US).
- Shift4 is offering NZ$1.20, the same price as that under the NBIO announced early last month. It’s a 46.05% premium to the 90-day VWAP, and 14.2x normalised FY25 EBITDA.
- The Offer has the unanimous backing of both boards, and also has the backing from Microequities holding 13.3% of shares out. Implementation expected in 4Q25.
HK Connect SOUTHBOUND Flows (To 20 June 2025); Net Buying, Volumes Up, TECH Down, BANKS Bought
- Gross SOUTHBOUND volumes up to US$15+bn a day this past 5-day week. Net buying still positive but still below US$500mm/day.
- Among the top buys as a percentage of volume, FINANCIALS stood out, dramatically. PROPERTIES too. Among top sells, INFO TECH again. 10 weeks in a row negative. Tencent bigly sold.
- The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Monitor are both there free for SK readers.
Weekly Update (AMRZ, LION, FTV)
- Holcim (HOLN SW) spun off its construction materials and solutions business into a standalone company on Friday, June 20th.
- The new company is called Amrize (AMRZ US).
- The first day of trading will be Monday, June 23, 2025.
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