In today’s briefing:
- Toyota Industries (6201) – SURPRISE! It’s a TOYODA Takeover Proposal (Good Governance May Not Win)
- Laopu Gold (6181 HK): Global Index Inclusion Likely Derailed by Full Circulation
- Hanwha Ocean (042660 KS) Placement: Index Implications; Stock Appears Wildly Overvalued
- KDB’s Hanwha Ocean Block Deal: Worth Taking a Swing
- Toyota (7203 JP) Tactical Outlook Following Toyota Industries (6201 JP) Privatization Rumors
- Horizon Robotics (9660 HK): Global Index Inclusion After April & October Lock-Ups
- FnGuide Top10 Index Rebalance Preview: Big Flow in Large Cap Stocks
- Poon’s Underpriced Takeover. Minorities Deserve Better
- Betr’s “Superior Offer” For PointsBet (PBH AU) Is Questionable
- Samsung SDI Rights Trade Period & Short Ban: Quick Clarity
Toyota Industries (6201) – SURPRISE! It’s a TOYODA Takeover Proposal (Good Governance May Not Win)
- On Friday after the close, media reports surfaced that Toyota Motor (7203 JP) Group chairman and founding family member had put forth a take-private proposal to Toyota Industries (6201 JP).
- The number quoted was ¥6trln market cap (most) or EV (FT), financed by personal funds, 3 megabanks, and reportedly some group companies.
- ¥6trln market cap would be +50%. ¥6trln EV +16%. Simultaneously shocking but somehow not surprising. Opportunistic, and surprisingly elegant as a family/group/cultural solution. More below.
Laopu Gold (6181 HK): Global Index Inclusion Likely Derailed by Full Circulation
- Laopu Gold (6181 HK) was on track to be added to a global index given its large H-share market cap and a free float that was close to 20%.
- Completion of the full circulation in April pushed H-share market cap higher while free float market cap remained the same. Crucially, free float dropped below 15%.
- Laopu Gold (6181 HK) could miss index inclusion in May, while inclusion in August will need some selling from non-float investors following lock-up expiry in June.
Hanwha Ocean (042660 KS) Placement: Index Implications; Stock Appears Wildly Overvalued
- Korea Development Bank is looking to sell 13m shares of Hanwha Ocean (042660 KS). That is US$740m at the top end of the marketed range and 4x ADV.
- Following the sale, Korea Development Bank will still own over 15% of the company and that will be an overhang for the stock. Plus the stock appears wildly overvalued.
- There will be limited buying from passive trackers at the time of the placement with bigger passive flows coming through in June and August.
KDB’s Hanwha Ocean Block Deal: Worth Taking a Swing
- KDB sells 4.3% of total shares, offloading about one fifth of its holdings. The price range was 81,265–81,710 won, at an 8.51–9.00% discount, totaling 1.056–1.062 trillion won.
- With more float and passive buying (KOSPI 200) potential, plus shipbuilding momentum, the stock’s pullback likely won’t exceed today’s discount — it might be worth taking a swing.
- There’s buzz KDB might sell its HMM stake through block trades, like Hanwha Ocean. However, with HMM’s cash reserves, a tender offer seems more likely to drive stock action instead.
Toyota (7203 JP) Tactical Outlook Following Toyota Industries (6201 JP) Privatization Rumors
- Toyota Motor (7203 JP) said in a Tokyo stock exchange filing on Saturday that it is exploring the possibility of investing in a potential buyout of key supplier Toyota Industries.
- Bloomberg reported Friday that Toyota Motor (7203 JP) Chairman Akio Toyoda and his family proposed acquiring Toyota Industries (6201 JP) in a possible 6 trillion yen ($42 billion) transaction.
- The stocks of both companies were rising on Monday, this insight focus on tactical positioning on Toyota Motor:the stock appears very OVERBOUGHT according to our models.
Horizon Robotics (9660 HK): Global Index Inclusion After April & October Lock-Ups
- Free float is expected to increase from 10% to 70% on 24 April for Global-F and on 24 October for Global-M. The delayed increase is due to undisclosed shareholders.
- Horizon Robotics (9660 HK) is forecasted to be added to global all-world in June 2025 following the 6-month lock-up expiry of most shareholders.
- Horizon Robotics (9660 HK) is forecasted to be added to global standard in February 2026 following the 12-month lock-up expiry of undisclosed shareholders.
FnGuide Top10 Index Rebalance Preview: Big Flow in Large Cap Stocks
- The Mirae Asset Tiger Top 10 ETF (292150 KS) tracks the FnGuide Top 10 Index and has an AUM of around US$660m.
- We currently forecast two potential changes at the next rebalance in June – both are high probability changes.
- The trade has performed well historically with positive performance till implementation followed by reversion post implementation in most cases.
Poon’s Underpriced Takeover. Minorities Deserve Better
- Dickson Concepts (113 HK) (DC)’s Chairman, Dickson Poon (& relatives), holding 61.98%, have tabled an Offer by way of a Scheme for shares not held, at HK$7.20/share (best & final).
- That compares to DC’s net cash (as at 30 Sept 2024) of HK$7.44/share. Plus financial assets comprise an additional ~HK$2.16/share.
- The IFA will cite liquidity and DC’s historical discount to NAV, and opine “reasonable”, and perhaps even “fair”. It is neither. Minorities should vote this down. But probably won’t …
Betr’s “Superior Offer” For PointsBet (PBH AU) Is Questionable
- On the 26th Feb 2025, PointsBet (PBH AU), an Australian/Canadian online wagering platform, entered into a Scheme Implementation Deed with Mixi (2121 JP) at A$1.06/share, a 27.7% premium to undisturbed.
- PointsBet rebuffed key (smaller) rival Betr Entertainment (BBT AU)‘s (previously known as BlueBet) ostensibly higher non-binding cash/scrip; and refuted Betr’s claim that it’s Offer was fully funded.
- Betr has returned with, what appears to be, an all cash offer of A$1.20/share, fully-funded/underwritten. Betr’s Offer still requires confirmatory due diligence. Importantly, Betr has also acquired a 19.9% stake.
Samsung SDI Rights Trade Period & Short Ban: Quick Clarity
- Samsung SDI kept the trading window open until May 12, not May 9 — so stock rights will trade for a total of six sessions.
- If all shorts are closed by May 16, we can still subscribe. Spot hedging isn’t allowed, but outright shorts for pricing plays are fine.
- Entry cost is effectively capped at 146,200 won, and it’s still very unlikely the final price exceeds that, so using it as the rights entry cap still makes sense.
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