In today’s briefing:
- [Japan Event/Buyback] The Sony Financial Spinoff – ‘Maybe’ BUYBACK Complicates Planning
- Gold Miners ETF (GDX US): Further Capping Pushes Trade to Over US$12.5bn
- Select Sector Indices and S&P Equal Weight Rebalance: Changes to Drive US$19.6bn Flow
- NIO (9866 HK/NIO US): Index Implications of US$1bn+ Offering
- Toei Animation Placement: Expensive, but Owns Valuable IP
- Fed: Politics Vs Fundamentals
- NIO (NIO US/9866 HK): An Opportunistically Timed US$1 Billion Raise
- Quiddity Leaderboard HSTECH Dec25: One Index Change Likely; US$650mn One-Way with Capping
- StubWorld: The Murdoch Succession Into News Corp, Fox & REA
- PointsBet (PBH AU) And Mixi Double Down Ahead Of Offer Closing
[Japan Event/Buyback] The Sony Financial Spinoff – ‘Maybe’ BUYBACK Complicates Planning
- The Sony Financial Holdings (8729 JP) (now called Sony Financial Group Inc (“SFGI”)) spinoff approaches. It will start trading 20 days from now.
- Yesterday, the TSE confirmed approval (outline, Securities Report (J), Corporate Governance Report (J). The company provided details of a possible ToSTNeT-3 buyback on Day 2 pre-open. That complicates things.
- The introduction of that type of buyback flexibility indicates that supply overhang may be managed better than buyers would hope. Means other strategies may be necessary.
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.
Select Sector Indices and S&P Equal Weight Rebalance: Changes to Drive US$19.6bn Flow
- There are 3 constituent changes for the S&P 500 INDEX (SPX INDEX) in September. There are capping changes for the Select Sector indices and the Equal Weight Index too.
- The round-trip trade is US$19.6bn with a big chunk from the Equal Weight Index, Technology Select Sector SPDR (XLK US) and Communication Services Select Sector SPDR Fund (XLC US).
- The largest flows are expected in AppLovin (APP), Robinhood Markets (HOOD), Trade Desk (TTD), NVIDIA (NVDA), Apple (AAPL), Alphabet (GOOGL), Microsoft (MSFT US), Exxon Mobil (XOM) and Chevron (CVX).
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.
Toei Animation Placement: Expensive, but Owns Valuable IP
- Toei Animation (4816 JP) ’s shareholder, Fuji Media, is looking to raise around US$210m from a secondary placement.
- The deal is a large one to digest, representing 41.7 days of the stock’s three month ADV and 4.9% of the shares outstanding.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Fed: Politics Vs Fundamentals
- President Trump’s current preference for rate cuts is not unconditional. Higher-order logic suggests this would not override fundamental resilience or fairly prove “TACO”.
- Political pressure is state-dependent, with the messenger mattering more than the objective truth beneath any message. Trump’s Chair will have a stronger hand.
- Brazil suffered President Lula’s pressure, but he still supported his “Golden Boy’s” turn from dovish dissent to forceful rate hikes. Fed pricing ignores the potential for change.
NIO (NIO US/9866 HK): An Opportunistically Timed US$1 Billion Raise
- NIO (NIO US), a Chinese premium electric vehicle manufacturer, has launched an equity offering to raise around US$1 billion.
- The raise is opportunistically timed to take advantage of the 83% QTD share price rally and comes hot on the heels of a US$513 million raise in April.
- While NIO continues to target a break-even in 4Q25 and reduce its cash burn, the valuation is stretched. A history of false dawns and intensifying competition warrants caution.
Quiddity Leaderboard HSTECH Dec25: One Index Change Likely; US$650mn One-Way with Capping
- The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
- In this insight, we take a look at the potential index changes and the resultant capping flows for HSTECH index rebal event in December 2025.
- We expect one index change for the HSTECH index in December 2025 based on the latest available data.
StubWorld: The Murdoch Succession Into News Corp, Fox & REA
- After a protracted succession stoush, Rupert Murdoch’s son Lachlan is set to take control of News Corp (NWS US) and Fox (FOXA US).
- Preceding my comments on News Corp and 62%-held REA Group Ltd (REA AU) 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%.
PointsBet (PBH AU) And Mixi Double Down Ahead Of Offer Closing
- On the 29th August, Mixi (2121 JP) cleared 50% of the voting power in PointsBet (PBH AU). It’s Offer was automatically extended, and will now close on the 12th September.
- Mixi has 51.59%. betr Entertainment (BBT AU) said it holds 20.45%, plus 6.5% in the IAF, the instructions for which can be withdrawn. betr said it won’t accept Mixi’s Offer.
- Mixi adds betr will have no PBH board representation “either now or in the future”; and betr will continue to be a clear competitor. Additionally, PBH questions betr’s buyback funding,
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