In today’s briefing:
- Merger Arb Mondays (19 Sep) – Link Admin, Ramsay, Alliance, Genex, Moya, Singapore Medical, VNET
- 3Q Dividend Estimates of Those with SSF for Cash & Carry Arb in Korea
- That’s It Then As Link Admin Rejects D&D’s Revised Terms
- Roblox Analyst Day Observations
- China Internet Weekly (19Sep2022): Tencent, NetEase, Meituan, Trip.com
Merger Arb Mondays (19 Sep) – Link Admin, Ramsay, Alliance, Genex, Moya, Singapore Medical, VNET
- We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand and Chinese ADRs.
- Highest spreads – Link Administration (LNK AU), Alliance Aviation Services (AQZ AU), 21Vianet Group (VNET US), Ramsay Health Care (RHC AU), Infomedia Ltd (IFM AU), Genex Power Ltd (GNX AU).
- Lowest spreads – Nitro Software Ltd (NTO AU), Tyro Payments (TYR AU), Nearmap Ltd (NEA AU), MACA Ltd (MLD AU), Xiamen International Port H (3378 HK), Link Net (LINK IJ).
3Q Dividend Estimates of Those with SSF for Cash & Carry Arb in Korea
- Juice for cash & carry arbitrage doesn’t seem like much. Several names in contango, but the basis widening isn’t at a sufficiently arb-tradable level.
- Reverse cash & carry isn’t all that attractive either, but it certainly does offer more juice, even with borrow fees. Ssangyong C&E, SKT, Shinhan, and KB deserve our attention.
- A bit uncertain is whether the pattern of “LONG Spot until ex-dividend and Conversion to Short” through cash & carry will repeat itself this time.
That’s It Then As Link Admin Rejects D&D’s Revised Terms
- After 23 months of negotiations, various bids from various parties, culminating in a protracted on-again, off-again, negotiation with Dye & Durham, Link Administration (LNK AU) has called it a day.
- D&D arguably did the right thing and tabled a revised proposal to account for any enforcement process after the UK’s FCA raised redress payments. Link has rejected the revised terms.
- Link will now pursue an in-specie distribution of a minimum of 80% of Link’s shareholding in PEXA Group (PXA AU).
Roblox Analyst Day Observations
- Roblox Analyst Day featured some interesting new initiatives around advertising and marketplace dynamics.
- The company will launch a self serve advertising platform in 2023 that has the potential to be worth an incremental 20% of revenues and margin supportive.
- The company is also allowing developers to start introducing scare items, and begin participating in the on-platform resale market.
China Internet Weekly (19Sep2022): Tencent, NetEase, Meituan, Trip.com
- Tencent and NetEase received new licenses from the authorities more than a year.
- Meituan’s car-hailing service joined Tencent WeChat’s traffic platform, Tencent Passenger Traffic.
- Express parcels and their revenue continued to recover in August.
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