In today’s briefing:
- But Wait … Even More Penalties In The Link Admin/D&D Situation
- Twitter V. Elon V Twitter: Elon Finally Hits A Vein
- True/DTAC Pop As Council Of State Rules NBTC Has No Teeth
- Softbank Group – A Surplus of VC Cash Could Re-Energize Vision Fund’s Investment Pace
- DTAC/True Merger: Council of State’s Decree Paves the Way for Completion
- XPER: Unlocking Value Thru Separation
- Teradyne Inc: Initiation of Coverage – Business Strategy & Key Drivers
- Five9 Inc: Initiation of Coverage – Partnership With Kyndryl & Other Drivers
- F5 Inc: Initiation of Coverage – Business Strategy & Key Drivers
But Wait … Even More Penalties In The Link Admin/D&D Situation
- Earlier this week, Link Administration (LNK AU) rejected Dye & Durham’s revised proposal to factor in any redress payments from the UK’s FCA in regards to the Woodford Fund.
- FCA has now assessed an appropriate penalty of £50mn in addition to the previously announced restitution payment of £306.1mn.
- The FCA is all but telegraphing it will default LFSL unless Link steps in. Link says it has made no such commitment. D&D should walk.
Twitter V. Elon V Twitter: Elon Finally Hits A Vein
- Bondholders on alert as a whistleblower complaint gives Elon’s case the substance he lacked as he tries break his agreement to buy Twitter
- But this doesn’t win Elon’s case—he has to prove deliberate fraud, which is far from clear
- It’s much easier for Twitter to prove Elon’s biggest complaint is buyers’ remorse—which isn’t sufficient grounds to terminate the deal.
True/DTAC Pop As Council Of State Rules NBTC Has No Teeth
- According to media reports, Thailand’s Council of State has ruled the NBTC has no authority to approve or reject the True Corp (TRUE TB) / Total Access Communication (DTAC TB) merger.
- The NBTC can prescribe measures to govern the deal but these appear almost of no consequence.
- The ruling is a positive development for the merger getting over the line. Both stocks enjoyed strong gains today.
Softbank Group – A Surplus of VC Cash Could Re-Energize Vision Fund’s Investment Pace
- News reports indicate venture capital firms are sitting in cash reserves 2x normal levels and that needs to be put to work
- We expected a narrowing of public v private valuation levels was needed for Softbank to pivot from recent defensive but competition for deals may be more relevant
- Access to investment capital is easier after settling of Alibaba-linked derivative contracts and Softbank has showed as recently as 2020 asset sales that it can lever up quickly
DTAC/True Merger: Council of State’s Decree Paves the Way for Completion
- The press reports that the Council of State has stated that the regulator, NBTC, can only prescribe measures to govern the Total Access Communication (DTAC TB)/True Corp Pcl (TRUE TB) merger.
- The Council of State decree paves the way for the merger to complete and the launch of the VTOs. The NBTC remedial measures will likely focus on consumer protection measures.
- The current share price ratio is 9.150x vs the swap ratio of 10.221x. At last close, DTAC and True’s gross spread to the VTO price is 4.4% and 1.8%, respectively.
XPER: Unlocking Value Thru Separation
- XPER held an investor day to highlight the two businesses XPER would separate into on October 1, 2022.
- The expectation is the two companies operating separately would be able to grow faster without worries over customer relationship to the other segment.
- Xperi has been the underpinning of our investment thesis due to the investments the Company has made in different products and customer engagements.
Teradyne Inc: Initiation of Coverage – Business Strategy & Key Drivers
- This is our first report on Teradyne, a leading global supplier of automation equipment for the testing of semiconductors, wireless products, data storage and complex electronics systems.
- In comparison to the previous year, industrial automation, wireless test, and system test revenues grew for Teradyne.
- Teradyne is lowering its shipment plan to align with reduced mobility-related test demand, continued supply shortages, and slower industrial automation growth.
Five9 Inc: Initiation of Coverage – Partnership With Kyndryl & Other Drivers
- This is our first report on Five9, a leading provider of cloud software for contact centers.
- The company’s core Virtual Contact Center (VCC) cloud platform has been a major revenue driver for them.
- Among key updates, Five9, along with Kyndryl, announced a partnership to offer its customers a cloud-enabled, personalized contact center experience.
F5 Inc: Initiation of Coverage – Business Strategy & Key Drivers
- This is our first report on F5 Inc, a well-known provider of multi-cloud security and application delivery that helps businesses connect to their customers.
- In the quarter, F5 saw a good demand as customers secured, scaled, and added their applications as demand for security fuel sales.
- Service providers have driven recent demand as secure 4G cores and customers scale and start to move 5G cores in production.
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