In today’s briefing:
- [Japan M&A] Sumitomo Corp To Buy Out Minorities in SCSK (9719 JP)
- Samsung Electronics Placement: Inheritance Tax Paydown by Family, Widely Telegraphed
- [Japan M&A] Fujitsu Buys Out Brainpad (3655) At Near 100% Premium
- BrainPad (3655 JP): Fujitsu (6702 JP)’s 100% Premium Tender Offer
- Samsung Electronics: Block Deal Sale of 1.8 Trillion Won for Inheritance Tax Payment by Lee Family
- Advantest Earnings… TPXC30, and Murata…
- Meta: A Good 3Q Spoiled by a Tax Problem. Capex Boom Continues in 2026.
- Hyperscalers’ Capex Update. Remember Jensen’s $500bn Yesterday ?
- Navan Inc. (NAVN): Mispriced AI Travel Platform Stumbles in Debut
- Booz Allen Hamilton Eyes Solid Growth with AI-Driven 6G & Quantum Defense Tech; Can It Materialize?
[Japan M&A] Sumitomo Corp To Buy Out Minorities in SCSK (9719 JP)
- Yesterday after the close, Sumitomo Corp (8053 JP) announced it would buy out minorities in Scsk Corp (9719 JP) at ¥5,700/share.
- As a “parent takes out subsidiary” deal, this was not unexpected at some point in time. The register looks like there may be a number of people who expected that.
- This gets done pretty easily. It is not a bad price.
Samsung Electronics Placement: Inheritance Tax Paydown by Family, Widely Telegraphed
- Samsung Electronics (005930 KS) is looking to raise around US$1.2bn from a secondary placement.
- This represents 0.9 days of the stock’s three month ADV, and 0.3% of total shares outstanding.
- In this note, we will talk about the placement and run the deal through our ECM framework.
[Japan M&A] Fujitsu Buys Out Brainpad (3655) At Near 100% Premium
- Today after the close, Fujitsu Ltd (6702 JP), with 110,000 employees, announced a buyout of a small “labour-intensive” AI/ML sysdev business with 200+ data scientists.
- Brainpad Inc (3655 JP) is being bought out from its co-founders and others at a near-100% premium. Not an all-time high, but not a low price.
- Somewhat heavily shorted, this will trade tight, but I expect nobody will come over the top.
BrainPad (3655 JP): Fujitsu (6702 JP)’s 100% Premium Tender Offer
- Brainpad Inc (3655 JP) has recommended a tender offer from Fujitsu Ltd (6702 JP) at JPY2,706, a 100.0% premium to the undisturbed price.
- The offer is attractive compared to historical trading ranges and is above the midpoint of the target IFA DCF valuation range.
- The huge takeover premium resulted from an auction. The tender offer runs from 31 October to 15 December (30 business days). This is a done deal.
Samsung Electronics: Block Deal Sale of 1.8 Trillion Won for Inheritance Tax Payment by Lee Family
- It was announced today that Samsung’s Lee family members are selling about 1.8 trillion won worth of Samsung Electronics (005930 KS) through an after-hours block trade.
- The purpose of the block trade is for the Lee family members to pay for inheritance taxes and repay stock-backed loans.
- The block trade selling level is between 102,200 won and 104,100 won, representing a discount of 0% to 1.8% compared to the closing price of the day.
Advantest Earnings… TPXC30, and Murata…
- Advantest saw a 34% upside after earnings, aligning with previous buy recommendations and its inclusion in the Value Seeker Japan basket for long-term growth.
- A small inclusion into TPXC30 occurs today at the close, with Advantest’s fundamental outlook remaining in line with our recent insights.
- Murata seeing some flows as well today in at the close, and moves to the TPX 70 Large.
Meta: A Good 3Q Spoiled by a Tax Problem. Capex Boom Continues in 2026.
- Good 3Q25: revenue 4% above Consensus, Operating Income 7% above. But a huge US$18bn tax reversal leads to a big GAAP miss. A 10% NON-GAAP beat.
- 2025 Capex revised up to high end of range, from $66-72 bn to $70-72 billion. 2026 Capex dollar growth will be notably larger than 2025, that means over 100bn.
- Stock down -9% after hours, an over-reaction to a one-off non-cash tax write off. Valuations: slightly high as 2026 growth is forecast to be low due to OP margin decline.
Hyperscalers’ Capex Update. Remember Jensen’s $500bn Yesterday ?
- First 3 hyperscalers to report (GOOG, META, MSFT). GOOG and META increase 2025 Capex. GOOG and META mention “significant increase” or “larger increase” in 2026.
- MSFT is in 1Q26, ending June-27. In FY25 Capex increased by 58% YoY. FY 26 capex will increase more than in FY25.
- Altogether it looks like a ~50% Capex increase in 2026.
Navan Inc. (NAVN): Mispriced AI Travel Platform Stumbles in Debut
- Navan Inc. (NAVN) priced its IPO at the midpoint of the range, $25.00 per share, raising approximately $922 million in gross proceeds.
- The stock opened below issue price at $22.00 and failed to find support during its debut session, trading as low as $19.74 before closing near its intraday lows.
- Despite strong top-line growth and margin improvement, investor skepticism centered around long-term scalability and sector defensibility.
Booz Allen Hamilton Eyes Solid Growth with AI-Driven 6G & Quantum Defense Tech; Can It Materialize?
- Booz Allen Hamilton provided detailed insights into their second quarter fiscal year 2026 performance and presented a mixed financial outlook characterized by a stark bifurcation in their market segments.
- The company faces significant challenges and opportunities, presenting both potential advantages and drawbacks for investors.
- On the positive side, Booz Allen’s national security portfolio, encompassing defense and intelligence sectors, shows encouraging signs.
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