In today’s briefing:
- [Japan Partial Tender] SBI Launches Partial Offer for 20% of BASE (4477 JP) At ¥340 – Needs More
- [Japan M&A] Itochu Deal Details for Dentsu Soken (4812); ¥2,880 Is Better than Rival Bid, But…
- [Japan Buyback] Canon’s ¥200bn Buyback Is Almost Done – A Short Study
- Shortlist of High-Conviction Ideas Across Japan, China & India – August 2026 (Post-Results)
- Lintec (7966 JP): The Current Playbook
- Merger Arb Mondays (31 Aug) – Dentsu Soken, Kakaku, EQT, Cleanaway, OFX, Reliance, Carnaby, Atlantic
- Canon Inc (7751 JP): Synthetic Expert Call Transcript (30 Aug 2026)
[Japan Partial Tender] SBI Launches Partial Offer for 20% of BASE (4477 JP) At ¥340 – Needs More
- On Friday quite late, BASE Inc (4477 JP) and SBI Holdings (8473 JP) announced a Business and Capital Alliance whereby SBI would buy 20% in a partial offer at ¥340/share.
- I think that’s too low given the history of the shares, the fact that Activist-ish-y Wealthy Guy Hiroyuki MAKI offered ¥407/share a year ago and got far fewer shares.
- Since then, revenues and earnings were revised upwards, and guidance this year is for strong growth. I would not be surprised to see…. um…. interference.
[Japan M&A] Itochu Deal Details for Dentsu Soken (4812); ¥2,880 Is Better than Rival Bid, But…
- Deal details are much as the Nikkei and Dentsu Soken reported. ¥2,880 for the 38.2% not owned by Dentsu. Dentsu and Itochu will be partners with Dentsu consolidating.
- The price is not very high considering the growth, especially when synergies are not included. The price is below the TargetCo FA’s DCF range midpoint w/o synergies.
- But there was a rival bidder in the selection process and they had a lower bid. So it isn’t clear who or what overbidder might come out. This gets done.
[Japan Buyback] Canon’s ¥200bn Buyback Is Almost Done – A Short Study
- Canon Inc (7751 JP) has been one of the most prolific executors of corporate buybacks in the past 20yrs. Up there with Toyota.
- Historically, its buybacks were finished very early in the buyback period, and were a big percentage of volume while being executed. The current one is different. Slower. Lower impact.
- This piece is a study. Our data shows Canon has underperformed during the buyback as EPS expectations have suffered vs Peers. The study shows post-buyback-end underperformance isn’t a thing.
Shortlist of High-Conviction Ideas Across Japan, China & India – August 2026 (Post-Results)
- We compile our selection of companies across Japan,China &India based on bottom-up triggers in each company post their recent quarterly/half yearly results and their guidance for remaining of the year.
- In Japan its ROHM Co Ltd (6963 JP),Suzuki Motor (7269 JP) & Mazda Motor (7261 JP). In China its Chow Tai Fook Jewellery (1929 HK) & Midea Group (300 HK).
- In India its a mix of recently listed – Milky Mist Dairy Food (1231D IN), Lalithaa Jewellery (LALITHAA IN) , Holdco – TVS (TVSHLTD IN) and select Auto OEs
Lintec (7966 JP): The Current Playbook
- Since the announcement of the US$0.7 billion secondary offering, Lintec Corp (7966 JP)’s shares have declined 3.7% to the undisturbed price of JPY5,730 per share (20 August).
- It is instructive to look at recent large Japanese placements to understand the potential trading pattern. Lintec’s share decline is lower than the median of recent large placements.
- The offering will likely be priced on 1 September. Since 2021, the average large Japanese placement has tended to generate positive returns.
Merger Arb Mondays (31 Aug) – Dentsu Soken, Kakaku, EQT, Cleanaway, OFX, Reliance, Carnaby, Atlantic
- I summarise the latest spreads and newsflow for the merger arb situations covered across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, the Philippines, Thailand, and Chinese ADRs.
- Highest spreads: Skyworth (751 HK), Changhong Jiahua (3991 HK), EQT Holdings (EQT AU), Tourism Holdings (THL NZ), Cleanaway Waste Management (CWY AU), Atlantic Lithium (A11 AU), OFX Group (OFX AU).
- Lowest spreads: Accent Group (AX1 AU), FleetPartners Group (FPR AU), Ausgold Ltd (AUC AU), Kakaku.com Inc (2371 JP), Dentsu Soken (4812 JP), Future Corporation (4722 JP).
Canon Inc (7751 JP): Synthetic Expert Call Transcript (30 Aug 2026)
- Parent-Child Delisting Hurdles: While the Tokyo Stock Exchange is pressuring companies to eliminate double listings, Canon Inc. is highly unlikely to take its 50.15%-owned subsidiary, Canon Marketing Japan, private anytime soon. The tax and capital hurdles, combined with the subsidiary’s transition into a high-margin IT solutions provider, make full integration financially inefficient for the parent.
- Regulatory Tailwinds and Hidden Risks: Canon’s newly deployed nanoimprint lithography (NIL) system, the FPA-1200NZ2C, presents a different architectural path than ASML’s extreme ultraviolet (EUV) systems. However, it still faces Ministry of Economy, Trade and Industry (METI) export control risks under Japan’s Foreign Exchange and Foreign Trade Act (FEFTA). Meanwhile, proposed EU REACH bans on per- and polyfluoroalkyl substances (PFAS) threaten the core laser printing margin engine by targeting critical toner additives and fuser roller coatings.
- Accounting Alterations Masking Organic Growth: Canon’s apparent 35.2% year-on-year operating profit surge in Q2 2026 to 159.2 billion Yen was heavily distorted by two transient factors: a 58 billion Yen tariff refund and an accounting shift on January 1, 2026, from declining-balance to straight-line depreciation, which artificially inflated near-term operating margins and masked flat underlying organic demand.
Disclaimer: The following transcripts are synthetic, AI-generated on demand, and compiled exclusively from public data sources; no real-word experts were actually interviewed. This content is designed to highlight potential market mispricings, explore compelling lines of inquiry, and suggest strategic questions rather than present verified facts. All specific financial metrics and data points, including market shares, TAM, margins, and growth rates, are AI-estimated approximations. They may be inaccurate and must be independently verified.
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