In today’s briefing:
- [Japan M&A] Minebea Matches YAGEO for Shibaura Elec (6957) At ¥6,200. Presses on Early Cashout
- [Japan M&A] Founder, KEPCO, Try ¥2,750 Bain-Led MBO on Rezil (176A). Light Given Growth – Bumpity?
- StubWorld: Stay Long Sun Corp (6736 JP)
- Shibaura Electronics (6957 JP): Minebea Changes Tack and Matches Yageo’s JPY6,200 Offer
- Rezil (176A JP): Bain’s Tender Offer Is a Done Deal
- Appier (4180) | Sustained High-Growth Momentum with Expanding Margins
- SoftBank Group (9984 JP): Our Last Review of Quarterly Data
- Allegro MicroSystems: Fueling EV & ADAS Growth with Strategic Design Wins!
- Hikari Tsushin (9435 JP): Q1 FY03/26 flash update
- Qb Net Holdings (6571 JP): Full-year FY06/25 flash update
[Japan M&A] Minebea Matches YAGEO for Shibaura Elec (6957) At ¥6,200. Presses on Early Cashout
- After three months of NOT matching YAGEO’s bid for Shibaura Electronics (6957 JP) at ¥6,w00 as YAGEO’s proposal continues its long plod through FEFTA review, Minebea-Mitsumi has now matched ¥6,200.
- Key is that their bid closes before the indicative deadline for YAGEO to receive word on FEFTA approval. They are hoping this bid mollifies the irrevocables and everyone else.
- But if YAGEO cares, it could bump to ¥6,300 tomorrow and extend its tender offer which closes on Monday. But the put option is now struck higher, which de-risks this.
[Japan M&A] Founder, KEPCO, Try ¥2,750 Bain-Led MBO on Rezil (176A). Light Given Growth – Bumpity?
- To my knowledge, this may be the first Tender Offer takeout proposal on a “new ticker.” Rezil (176A JP) was listed just 16mos ago.
- This takeout is done on a highish-growth stock at 11.7x 1yr forward EV/EBITDA. It’s not expensive, but they have ~60%. BUT… there’s another Potential Player who may have Big Thoughts.
- Slightly long-dated, small-cap, likely to be illiquid. Watch how it trades early for hints.
StubWorld: Stay Long Sun Corp (6736 JP)
- Sun Corp (6736 JP) is a clear value play. But not as cheap to 44.3%-held Cellebrite DI (CLBT US) as it was recently. Opt for a net long trade here.
- Preceding my comments on Sun Corp – and JG Summit Holdings (JGS PM) / Universal Robina (URC PM) – 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%.
Shibaura Electronics (6957 JP): Minebea Changes Tack and Matches Yageo’s JPY6,200 Offer
- Despite its previous protestations, Minebea Mitsumi (6479 JP) has unexpectedly matched Yageo Corporation (2327 TT)’s JPY6,200 offer for Shibaura Electronics (6957 JP).
- Minebea’s actions suggest that Yageo has a good chance of securing regulatory approval. Otherwise, Minebea could have kept its offer unchanged and patiently waited for the Yageo offer to fail.
- Given the significant sunk costs, Yageo is likely to bump. Without increasing its offer, shareholders will have a greater inclination to tender and help Minebea meet its minimum tendering condition.
Rezil (176A JP): Bain’s Tender Offer Is a Done Deal
- Rezil (176A JP) has recommended a tender offer from Bain Capital at JPY2,750, a 57.1% premium to the undisturbed price of JPY1,750.
- The offer is attractive as it aligns with the midpoint of the target IFA DCF valuation range, represents an all-time high and is 129.2% above the IPO price of JPY1,200.
- This is a done deal as Hikari Tsushin, a cross-holder, tendering is sufficient to meet the minimum tendering condition. At the last close, the gross spread was 6.8%.
Appier (4180) | Sustained High-Growth Momentum with Expanding Margins
- Revenue: JPY 10.3 billion compared to JPY 8.2 billion a year ago, +27% YoY; FX-neutral revenue of JPY 11.0 billion, +35% YoY – fastest growth in eight quarters.
- Gross Margin: 56.1%, up 4.8 percentage points YoY, driven by high-margin products, organic margin improvements, and GenAI-enabled efficiencies.
- Stock continues to offer compelling value at 3.2x revenue – a discount to US peer Braze
SoftBank Group (9984 JP): Our Last Review of Quarterly Data
- With this report, we terminate coverage of SoftBank group (SBG) shares; going forward, our coverage will be concentrated on financial and fintech stocks, with a bias towards Emerging Markets
- SBG shares have rallied hard recently, driven by IPOs of portfolio companies, good IPO prospects for other private companies including PayPay and positive market sentiment towards AI investments
- The group NAV’s discount has narrowed sharply to under 30%; we conclude our coverage with a neutral rating, but we stress that high expectations are baked into this narrow discount
Allegro MicroSystems: Fueling EV & ADAS Growth with Strategic Design Wins!
- When we look at the broader performance of Allegro MicroSystems, the results indicate both positive and challenging aspects of the company’s current situation.
- From a financial perspective, Allegro delivered a solid performance in its first quarter of fiscal year 2026.
- The company reported sales of $203 million and a non-GAAP earnings per share of $0.09, which was above the midpoint of their guidance range.
Hikari Tsushin (9435 JP): Q1 FY03/26 flash update
- The company reported Q1 FY03/26 revenue of JPY167.2bn (+14.4% YoY) and recurring income of JPY43.5bn (+12% YoY).
- New segmentation in Q1 FY03/25 includes seven reportable segments; revenue and profit figures adjusted retroactively.
- Dividend for Q1 FY03/26 set at JPY181 per share, with total payout of JPY7.9bn, effective September 12, 2025.
Qb Net Holdings (6571 JP): Full-year FY06/25 flash update
- Revenue rose JPY786mn YoY, driven by growth in Domestic and Overseas Operations, with a +3.2% full-year increase.
- Operating profit declined JPY430mn YoY due to unplanned costs in Domestic Operations and increased talent development investment.
- The company opened 43 new salons, increasing the total salon count by 33 YoY to 724.
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