In today’s briefing:
- Dai-Ichi Life “Decides” Tender Offer Price and Buyback Price at ¥2,123 and ¥1,491/Share
- Benefit One (2412 JP): Dai-Ichi Life’s Tender Offer at JPY2,123
- Buy Pasona As Dai-Ichi Life Amends Benefit One’s Tender Offer & Buyback Price
- COSCO Shipping Energy (1138 HK): Time for Another Look
- AOT Vs MAHB: Part Deux
- MillerKnoll, Inc. – 2QFY24 Results Deliver Strong Margins; Orders Challenged
Dai-Ichi Life “Decides” Tender Offer Price and Buyback Price at ¥2,123 and ¥1,491/Share
- Today, Dai Ichi Life Insurance (8750 JP) came out with a cover letter and an amended Announcement of Intention to Commence a Tender Offer on Benefit One Inc (2412 JP).
- The cover letter says they have obtained information from Pasona Group (2168 JP) and Benefit One allowing them to calculate a Tender Offer of ¥2,123/share for minorities, and buyback at ¥1,491/share.
- Now we wait. Again. Dai-Ichi Life “intends” to start a tender in mid-Jan 2024 (19 Jan likely earliest start possible) but it is not clear timing will come that early.
Benefit One (2412 JP): Dai-Ichi Life’s Tender Offer at JPY2,123
- Dai Ichi Life Insurance (8750 JP)‘s pre-conditional tender offer for Benefit One Inc (2412 JP) is JPY2,123 per share, a 32.7% premium to M3 Inc (2413 JP)’s offer.
- The other terms are unchanged. The pre-conditions relate to board recommendation, Pasona Group (2168 JP) support, and the M3 offer not being completed. The tender offer starts in mid-January 2024.
- While M3 has extended its offer period to 17 January 2024, it will unlikely engage in a bidding war. Expect the Board and Pasona to support the Dai-ichi Life proposal.
Buy Pasona As Dai-Ichi Life Amends Benefit One’s Tender Offer & Buyback Price
- Earlier this month, Dai Ichi Life (8750 JP) countered M3 with an unsolicited ¥1,800/share Offer of Equity Value TOB; followed by a Benefit One buyback to mop up Pasona‘s stake.
- Dai-Ichi has now amended the TOB Price for minorities in Benefit One to ¥2,123/share, and the tax-equivalent price of ¥1,800/share for Pasona would be ¥1,491 on the Buyback Tender, post-squeezeout.
- That price appears a bit higher for Pasona than expected, and therefore a bit lower for Benefit One minorities. Terms can still be bumped.
COSCO Shipping Energy (1138 HK): Time for Another Look
- The 20% retreat in the share price of Cosco Shipping Energy Transportation (1138 HK) from the peak has well reflected the plunge in 3Q23 VLCC rates and 10% earnings downgrade.
- 4Q23 VLCC rates have rebounded 78.4% QoQ. Re-routing due to recent Houthi attacks on commercial ships at the Red Sea has reduced effective supply and is positive to rates.
- Heightened energy security needs will drive demand. The medium-term supply pressure is mild as the VLCC orderbook equals just 2% of the existing fleet, fueling ROE for FY23-25F.
AOT Vs MAHB: Part Deux
- Airports of Thailand (AOT TB) 6m24 revenue growth rates are healthy, supported by the growth in departure passenger service charges and the coming back of concession revenues.
- AOT labor expenses have expanded at an unprecedented level, even higher than pre-COVID levels, while Malaysia Airports Holdings (MAHB MK) kept them under control.
- Book profit on half of the exposure and wait for the next quarter to see if AOT labor expenses will stay high.
MillerKnoll, Inc. – 2QFY24 Results Deliver Strong Margins; Orders Challenged
- After market close on December 20, MillerKnoll reported 2QFY24 adjusted EPS of $0.59, ahead of our estimate of $0.55 and the consensus mean of $0.54.
- Margins were better than expected, while revenue of $949.5 million came in at the low end of guidance.
- Sales in the Americas segment disappointed relative to our expectations.
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