In today’s briefing:
- Gold Miners ETF (GDX US): Further Capping Pushes Trade to Over US$12.5bn
- Sun Corp (6736) – CLBT Has Round-Tripped, But Now Better ParentCo and a Buyback so Set-Up Is Better
- NIO (9866 HK/NIO US): Index Implications of US$1bn+ Offering
- [Japan M&A] Mandom (4917 JP) MBO – Light Price, Open-Ish Register, Tough to Take Over, Could Do Fun
- Zijin Mining: Gold IPO De-Risks, Copper Upside Remains
- Evergrande Property Services (6666 HK): Liquidators’ Auction
- [Japan M&A] Digital HD (2389 JP) MBO Takeunder Is Optically Bad, A Little Light, But Tough to Beat
- Kiri’s $700 Million Exit From DyStar – What Next?
- Infosys Buyback: Tax-Inefficient for Shareholders?
- Changhong Jiahua (3991 HK): Expect Sichuan Changhong To Make An Offer
Gold Miners ETF (GDX US): Further Capping Pushes Trade to Over US$12.5bn
- The VanEck Gold Miners ETF/USA (GDX US) will change benchmark from the NYSE Arca Gold Miners Index to the MarketVector Global Gold Miners Index at the close on 19 September.
- The differences in the constituents between the two indices should result in 8 adds and 25 deletes. Estimated one-way turnover is 27.4% resulting in a round-trip trade of US$12.5bn.
- The forecast adds have continued to underperform the forecast deletes as the big valuation gap that had opened up since the announcement of the benchmark switch narrows.
Sun Corp (6736) – CLBT Has Round-Tripped, But Now Better ParentCo and a Buyback so Set-Up Is Better
- 12 months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is up small and its main asset Cellebrite is -10%.
- The value of the rest of Sun Corp has probably increased to cover that 10% through new business earnings, but the main value is still Cellebrite. An exit still awaited.
- Now Cellebrite is lower, and SunCorp is lower (but recently rising) and SunCorp has announced a buyback which accounts for a big chunk of Real World Float. Hmmm…
NIO (9866 HK/NIO US): Index Implications of US$1bn+ Offering
- NIO (9866 HK) / NIO (NIO US) is looking to raise up to US$1.15bn, including the overallotment option, in an equity offering across Hong Kong and the U.S.
- The HK offering is priced at HK$43.36/share and the ADR pricing is US$5.57/share. NIO (NIO US) closed at US$5.72/share overnight, so expect NIO (9866 HK) to open around HK$44.55/share.
- There will be buying from global index trackers at the time of settlement of the offering shares. The buying from Hang Seng TECH Index (HSTECH INDEX) trackers is more nuanced.
[Japan M&A] Mandom (4917 JP) MBO – Light Price, Open-Ish Register, Tough to Take Over, Could Do Fun
- On 10 September, the founding Nishimura family, the PE Firm CVC, and Mandom Corp (4917 JP) agreed that the first two could take over the latter at 4.9x Mar28 EBITDA.
- A cocktail napkin calculation of expected leverage suggests the equity check is buying this at 5x average Mar27-28 free cash flow. That’s cheap for a growing company.
- The register is open enough to cause problems but not open enough to allow a clean hostile bid by a strategic. But still open enough for someone to have fun.
Zijin Mining: Gold IPO De-Risks, Copper Upside Remains
- Dilution: The gold IPO trims attributable EBITDA by ~3% as minority interests rise.
- Parent Impact: Zijin parent emerges leaner, with net debt falling by US$4bn and copper now ~70% of EBITDA.
- Valuation: At ~7× EV/EBITDA, the stock offers 15–30% upside on our estimates, stretching to 25–45% at spot.
Evergrande Property Services (6666 HK): Liquidators’ Auction
- In Evergrande Property Services (6666 HK): Offer Expected As Parent (Likely) Exits., I speculated on the outcome of Evergrande Property Services (6666 HK) (EPS)’s suspension due to the Takeovers Code.
- EPS has now announced that the liquidators for Evergrande (3333 HK) have been fielding non-binding Offers for Evergrande’s 51.016% stake in EPS. Final proposals are expected to be submitted by November.
- With a view to maximizing proceeds, the liquidators will ideally seek a sole bidder, leading to a change of control. And an unconditional MGO. Shares resume trading this morning.
[Japan M&A] Digital HD (2389 JP) MBO Takeunder Is Optically Bad, A Little Light, But Tough to Beat
- On 11 Sep 2025 after the close, Hakuhodo Dy Holdings (2433 JP) announced a takeunder of Digital Holdings Inc (2389 JP) in MBO form.
- Two major holders with 37% roll their stakes into new ownership in Hakuhodo Dy Holdings (2433 JP) and another 17+% probably just fall in line.
- Foreigners hold a lot. They may not like the takeunder. It is not clear who would buy this if Hakuhodo does not, or whether it is worth the hassle.
Kiri’s $700 Million Exit From DyStar – What Next?
- Kiri Industries has signed a deal to sell its 37.6% stake in DyStar Global to Zhejiang Longsheng for US$697 million (~INR 5,800 crore), concluding a decade-long Singapore court battle.
- The payout is multiple times Kiri’s current market cap and marks one of the strongest minority shareholder wins globally.
- The DyStar exit removes litigation overhang and hands Kiri a war chest. Now, execution of the copper and fertilizer project will define the future of the company.
Infosys Buyback: Tax-Inefficient for Shareholders?
- Infosys Ltd (INFO IN) made headlines in the market after approving share buyback worth INR 180 bn at INR 1800 per share.
- The buyback is the largest in company’s history and represents 2.4% of the paid up capital.
- However, from the shareholders lens, the buyback would be tax-inefficient, after the regulatory changes which came in effect from Oct 2024.
Changhong Jiahua (3991 HK): Expect Sichuan Changhong To Make An Offer
- Changhong Jiahua Holdings (3991 HK) (CJ), which is principally engaged in the distribution of consumer electronic products, is suspended pursuant to the Takeovers Code.
- Sichuan Changhong Electric Co, Ltd. (600839 CH) holds ~60.13% of the shares outstanding. And 100% of the preference shares (76.7% of shares out).
- This week, a final judgement, concerning monies owed, was ruled in CJ’s favour. The sum involved is ~30% of CJ’s market cap.
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