In today’s briefing:
- Merger Arb Mondays (22 Jul) – China TCM, GA Pack, Huafa, Samson, CPMC, Fancl, Tatsuta, Capitol
- Pre-IPO Elpiscience Biopharmaceuticals – Will Investors Still Buy in These Stories?
Merger Arb Mondays (22 Jul) – China TCM, GA Pack, Huafa, Samson, CPMC, Fancl, Tatsuta, Capitol
- 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: Yichang HEC Changjiang Pharma (1558 HK), China Traditional Chinese Medicine (570 HK), Asia Cement China (743 HK), Canvest Environmental Protection Group (1381 HK), Greatview Aseptic Packaging (468 HK).
- Lowest spreads: Tatsuta Electric Wire & Cable (5809 JP), Alumina Ltd (AWC AU), Fancl Corp (4921 JP), Mimasu Semiconductor Industry (8155 JP), Infocom Corp (4348 JP), Hollysys.
Pre-IPO Elpiscience Biopharmaceuticals – Will Investors Still Buy in These Stories?
- Elpiscience is incubated by LAV from the very beginning.The Company has strong capital operation capabilities, but the story of “founding team’s decent background + star cornerstone investors” doesn’t work anymore.
- Elpiscience’s pipelines are still in early stage. However, investors are rational. They will no longer believe in those “good stories”, but focus more on cash flow and drug sales revenue.
- Elpiscience’s business model has raised concerns about its future product sales scale and profits.The market may not recognize the post-investment valuation of US$599 million if check the valuation of peers.
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