In today’s briefing:
- Roland DG (6789) – Brother Still Not Making Friends
- (Mostly) Asia-Pac M&A: APM Human Services, Jastec, Genex, JSR Corp, Chilled & Frozen, Lawson
- Last Week in Event SPACE: Mitsui Fudosan, Melco, Aozora Bank, CGN New Energy
- Isn’t It Not Strong Enough to Raise ROE by Higher Profit Margin Due to Escape from Deflation?
Roland DG (6789) – Brother Still Not Making Friends
- Taiyo Pacific’s Tender Offer for Roland DG Corp (6789 JP) was to end Friday, but it was extended 10 days.
- Roland DG provided an update regarding the status of the Brother overbid. It did not show as much strategic-mindedness as it might have.
- Shares are now trading at a post-overbid high. Strategic missteps up the risk but Brother can pay more.
(Mostly) Asia-Pac M&A: APM Human Services, Jastec, Genex, JSR Corp, Chilled & Frozen, Lawson
- I tally 51 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Two new deals discussed on Smartkarma this week: Madison Dearborn’s low-balled Offer for APM Human Services (APM AU); and NTT Data Corp (9613 JP)‘s Offer for Jastec (9717 JP).
- Key updates took place on: Boral Ltd (BLD AU), Azure Minerals (AZS AU), Genex Power (GNX AU), JSR Corp (4185 JP), Chilled & Frozen Logistics Holdings (9099 JP), & Lawson (2651 JP).
Last Week in Event SPACE: Mitsui Fudosan, Melco, Aozora Bank, CGN New Energy
- 9 weeks ago, the FT reported Elliott Management had a stake in Mitsui Fudosan (8801 JP) and had asked them to sell cross-holdings and do a ¥1trln buyback. Mitsui responds.
- Lawrence Ho is buying Melco(200 HK). While it often pays to follows where the family invests, Melco is trading too tight for what is a simple holding company structure.
- Avoid being long Aozora Bank Ltd (8304 JP) vs the Banks Index, a portfolio of other cheaper banks, etc. Minimal/negligible upside in following Murakami-san here. And Activism on Banks is difficult.
Isn’t It Not Strong Enough to Raise ROE by Higher Profit Margin Due to Escape from Deflation?
- Since 2020, there has been a divergence between P/B and TOPIX movements, complicating matters for listed companies that have been asked to raise their P/Bs.
- Expectations are high for a rise in ROE, which has a certain correlation with nominal GDP, which is also increasingly correlated with TOPIX, as deflation exits.
- If price pass-through fails, escaping deflation may not lead directly to higher profit margins. If profit margin increase is insufficient, reducing cash on hand is essential to increase ROE.
💡 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
