In today’s briefing:
- StubWorld: CKH (1 HK) – Expect Near-Term Weakness If Exclusivity Ends Without Resolution
- Fraser Hospitality Trust (FHT SP): Scheme Vote on 15 August
- Everything to Know About the Year-End CGT-Driven Retail Sell-Off & KOSPI Basis Move
- Event Driven: Tilaknagar Ind ₹4,150 Cr Imperial Blue Acq.~Transformational Play or Leverage Trap?
- [Japan M&A] Nikkei Reports Pacific Industrial (7250) To Go Private Via MBO at ¥110bn
- Frasers Hospitality Trust (FHT SP): 15th August Vote On Frasers Prop/TCC Offer
- Event Driven: Natco Pharma’s Strategic Acquisition of Adcock Ingram
StubWorld: CKH (1 HK) – Expect Near-Term Weakness If Exclusivity Ends Without Resolution
- CK Hutchison Holdings (1 HK)‘s delicate dance continues as it juggles U.S and Beijing politics; and its fiduciary duty to shareholders, as the Blackrock exclusivity long stop date looms.
- In a double dose of StubWorld this week, preceding my comments on CKH – and CK Infrastructure Holdings (1038 HK) – are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
Fraser Hospitality Trust (FHT SP): Scheme Vote on 15 August
- The Frasers Hospitality Trust (FHT SP) IFA opines that Frasers Property Ltd (FPL SP)’s scheme offer of S$0.71 cash and permitted distributions (estimated at S$0.0098) is fair and reasonable.
- While the current offer is arguably light compared to the failed 2022 offer, the lack of vocal opposition and limited retail displeasure reduces the vote risk.
- On balance, the scheme vote should pass. For a 30 September payment, the gross/annualised spread of the total offer (S$0.7198) is 2.8%/15.6%.
Everything to Know About the Year-End CGT-Driven Retail Sell-Off & KOSPI Basis Move
- If the CGT threshold drops from ₩5B to ₩1B, year-end retail selling could surge—net sales were ₩14T in Nov–Dec 2023 versus just ₩2.5T in the same period of 2024.
- Retail may react strongly this year due to higher unrealized gains and the ₩1B CGT threshold return; about 65% of KOSPI stocks still use year-end dividend record dates.
- Odds are high for a classic year-end CGT-driven retail sell-off and a sharp KOSPI cash-futures basis move, fueled by dividend uncertainty we can capitalize on.
Event Driven: Tilaknagar Ind ₹4,150 Cr Imperial Blue Acq.~Transformational Play or Leverage Trap?
- Tilaknagar Industries (TLNGR IN) acquires Pernod Ricard India’s Imperial Blue for INR 4,150 crore, diversifying its portfolio into whisky from dominance in brandy.
- This acquisition will establish TI as a pan-India spirits player, significantly enhancing distribution and is expected to be accretive.
- However, substantial deal size raises concerns about equity dilution, high leverage risks, and significant integration challenges for TI
[Japan M&A] Nikkei Reports Pacific Industrial (7250) To Go Private Via MBO at ¥110bn
- Overnight, the Nikkei carried an article saying Toyota valve supplier Pacific Industrial (7250 JP) would go private at a 40% premium in an MBO.
- The implied price would match its ATH, but would remain far below book value, which is disappointing for a company with a very strong customer base and market share.
- This is potentially blockable, but it would need to be activism from scratch I think. An activist or collection of them would need about 18-20% to block this deal.
Frasers Hospitality Trust (FHT SP): 15th August Vote On Frasers Prop/TCC Offer
- Back on the 14th May 2025, S-REIT Frasers Hospitality Trust (FHT SP) entered into a Scheme with its current sponsor, Frasers Property Limited, @ S$0.71/share.
- The Scheme Consideration is 1.11x the latest adjusted NAV estimate of S$0.63904/unit; and S$0.01/unit above Frasers/TCC’s S$0.70/unit failed Offer back in September 2022.
- The Scheme Doc is now out, with a shareholder vote on the 13th August. The IFA says fair and reasonable.
Event Driven: Natco Pharma’s Strategic Acquisition of Adcock Ingram
- Natco Pharma acquires a 35.75% stake in South Africa’s Adcock Ingram, marking its largest overseas expansion to date.
- This move instantly gives Natco a strong foothold in Africa’s pharma market and diversifies its global revenue streams from current headwind of US market.
- Natco transitions from a primarily India/US-focused player to a serious contender in strategic emerging markets, enhancing its growth outlook.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
