Event-Driven Archives | Page 102 of 187 | Smartkarma

Newmont Mining (NEM US), the world’s largest gold miner, has pitched a non-binding, all-scrip proposal for Newcrest Mining (NCM AU), Australia’s largest listed gold company.
The proposal offers 0.38 Newmont shares for every Newcrest share, or an indicative Offer price of A$27.16/share, a 21% premium to last close. An earlier proposal from Newmont was rejected.
The proposal is subject to a raft of conditions, including granting of exclusivity to Newmont, due diligence, Newmont shareholder approval, and regulatory approvals, including FIRB.

Korea: Upcoming Changes to Dividend Rules & Implications

On 31 January, Korea’s Financial Services Commission (FSC) and the Ministry of Justice announced plans to improve rules regarding dividends to bring them in line with international standards.
Companies will be able to decide the dividend amount prior to the record dates for quarterly dividends, while the ex-date of the final dividend will be post the AGM.
This was one of the issues highlighted by MSCI for Korea’s upgrade from EM to DM. There are also implications for the KOSPI200 futures basis and futures rolls.

Korea NPS Reportedly Finalized Additional 50 KOSPI Stocks in Its BM for Direct Management

NPS said it would add 50 KOSPI stocks to KOSPI 200 for direct management. However, the key was when this would be implemented and which ones would be included.
SBS, one of Korea’s major networks, exclusively reported that NPS finalized the constituent stocks of the NPS-KR250 and started rebalancing trading on the 50 additional KOSPI stocks from January.
Hence, tracing and identifying who these additional 50 KOSPI stocks are is becoming the hottest topic in Korea’s local market at this point.

Quiddity Leaderboard-S&P/ASX Mar 23: Time to Be Bullish ASX 200 & 300 Potential ADDs

In this insight, we take a look at the potential index changes for S&P ASX 20, 50, 100, 200, 300 in the run up to the March 2023 Rebalance.
There could be one change for ASX 20 and one change for ASX 100 while ASX 200 could see four ADDs/DELs.
For ASX 300, there could be 15 ADDs and 12 DELs in the March 2023 Rebalance including some high impact names based on days-to-trade.

Renault & Nissan Deal Done: Still a Trading Nothing🍔 So Far, OK Framework but Need Shaq Fingerguns

As “disclosed” recently, we have a deal. Nissan Motor (7201 JP) will invest “up to 15%” in Ampere. Mitsubishi Motors (7211 JP) may join. They have many potential joint projects.
The key is the Governance Framework, which replaces RAMA. Renault SA (RNO FP) puts 28.4% of Nissan in an open-ended Trust. Renault and Nissan have 15% reciprocal voting rights.
The webcast is more optimistic than I am. Luca de Meo made special mention of the joint projects. This sounds good. It sounds like what has always been promised.

Newcrest Mining (NCM AU): Newmont’s Light All-Scrip Offer

Newcrest Mining (NCM AU) confirmed a non-binding indicative privatisation proposal from Newmont Mining (NEM US) at 0.380 Newmont shares per Newcrest share.
The offer values Newcrest at a discount to Tier 1 gold producer EV/Resource multiples. Also, the offer carries the volatility risk around Newmont shares and FX rates.
The offer underscores Newcrest’s value and helps the Board seek better terms. There is a possibility of a counterbid from other Tier 1 producers such as Barrick Gold (GOLD US).

Boustead Projects (BOCJ SP): Unconditional Offer at S$0.90 from Boustead Singapore

Boustead Projects (BOCJ SP)/BPL has disclosed a voluntary unconditional offer from Boustead Singapore Limited (BOCS SP) at S$0.90 per share, a 7.8% premium to the undisturbed price (3 February).
The offer price is unattractive in comparison to peer multiples, historical trading ranges and precedent transactions. However, the offer price is not final.
As Boustead Singapore aims to privatise BPL there is a possibility of a bump. The offer document will be despatched and the offer opens by 27 February.

Iwasaki Electric (6924 JP): JPY4,460 MBO Tender Offer from Carlyle

Iwasaki Electric (6924 JP) has recommended an MBO tender offer, sponsored by Carlyle Group Inc (CG US), of JPY4,460 per share, an 86.1% premium to the undisturbed price (6 February).
The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the offer has been set to meet the 66.67% ownership ratio.
The tender offer is attractive and represents a ten-year share price high. This suggests a done deal. The tender offer period is from 7 February to 22 March.

Delta Electronics (DELTA TB / 2308 TT): Waiting for a Reversal

Delta Electronics Thai (DELTA TB) is now the largest stock in Thailand by market cap. The recent SET50 INDEX inclusion has set the stock on fire.
The Delta Electronics Thai (DELTA TB) / Delta Electronics (2308 TT) spread is very wide now, but still well within the historical highs.
We’d put on a placeholder position and monitor the spread for an entry once there is a clearer indication of a reversal in the spread.

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Feb 06

Daily Brief Event-Driven: CSI500 Index Rebalance Preview: Potential Adds Continuing to Outperform and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

CSI500 Index Rebalance Preview: Potential Adds Continuing to Outperform
Newmont’s Indicative Offer for Newcrest Mining (NCM AU)
Mitsui & Co (8031) Q3 – Big Profit, New Bigger Buyback, Some Index Selling; and Competition
Merger Arb Mondays (6 Feb) – Yashili, Kingston, Origin, Pushpay, Halcyon, O2Micro, Techno Associe
BBL/KBANK: Huge Outperformance as BBL Nears NVDR Limit
Quiddity Leaderboard for Hang Seng Index Mar 23: Healthcare Names Could Dominate
Introducing ARIRANG K-Defense, Sector ETF Currently in the Limelight in Korea
Weekly Deals Digest (05 Feb) – Pertamina Geothermal, Hesai, Halcyon, Toshiba, Pushpay, O2Micro

CSI500 Index Rebalance Preview: Potential Adds Continuing to Outperform

Three quarters of the way through the review period for the June rebalance of the CSI500 Index, we forecast 50 changes (the maximum permitted) at the close on 9 June.
There is a big sector skew in the potential changes. We estimate a one-way turnover of 11.47% at the June rebalance resulting in a one-way trade of CNY 10.11bn.
The potential adds have outperformed the potential deletes and the CSI500 Index over the last few weeks. There could be more outperformance till nearer the end of the review period.

Newmont’s Indicative Offer for Newcrest Mining (NCM AU)

Newmont Mining (NEM US) has made an indicative, non-binding and conditional proposal to acquire Newcrest Mining (NCM AU). The exchange ratio is 0.38 Newmont shares for each Newcrest share.
At Newmont Mining (NEM US)‘s last close, this values Newcrest Mining (NCM AU) at A$27.4/share and at an equity value of A$17.3bn, a 22% premium to the last close.
Newmont Mining (NEM US) intends to list CDIs on the ASX following the acquisition and that will have implications for changes in the S&P/ASX family of indices.

Mitsui & Co (8031) Q3 – Big Profit, New Bigger Buyback, Some Index Selling; and Competition

Mitsui & Co Ltd (8031 JP) reported Q3 earnings Friday afternoon during the market session. Like at Q2, they upped their fiscal-year forecast to well above Street consensus.
Also like Q2, they announced a buyback – this one an extension in time, shares, and money on the one already in place, raising the total Core CashFlow Payout Ratio.
This creates interesting index flows over the next several months, and other trading cos have live buybacks too.

Merger Arb Mondays (6 Feb) – Yashili, Kingston, Origin, Pushpay, Halcyon, O2Micro, Techno Associe

We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads – Alliance Aviation Services (AQZ AU), 21Vianet Group (VNET US), Origin Energy (ORG AU), Golden Energy & Resources (GER SP), 111 Inc (YI US), Toyo Construction (1890 JP).
Lowest spreads – Essential Metals (ESS AU), Tyro Payments (TYR AU), Chip Eng Seng Corp (CHIP SP), Conexio Corp (9422 JP), Kanematsu Electronics (8096 JP), Elmo Software (ELO AU).

BBL/KBANK: Huge Outperformance as BBL Nears NVDR Limit

Bangkok Bank (BBL TB) has outperformed Kasikornbank PCL (KBANK TB) by 33% over the last 11 months and the price ratio is nearing the high end of the historical range.
The number of NVDRs issued on Bangkok Bank Public (BBL TB) have continued to increase while decreasing on Kasikornbank PCL (KBANK TB).
Bangkok Bank Public (BBL TB) now trades at a higher forward PE as compared to Kasikornbank PCL (KBANK TB) and the gap in price to book has narrowed significantly.

Quiddity Leaderboard for Hang Seng Index Mar 23: Healthcare Names Could Dominate

In this insight, we take a look at the potential index changes for the Hang Seng Index (HSI INDEX) in March 2023.
We believe Healthcare names could be given top priority when selecting additions for the upcoming rebalance.
The final index changes along with indicative capping and index weights could be published in Mid/Late-February 2023 and implemented in early-March 2023.

Introducing ARIRANG K-Defense, Sector ETF Currently in the Limelight in Korea

ARIRANG K-Defense Industry Fn ETF (449450 KS) shows the fastest AUM/ADV growth among recently listed sector ETFs. It is virtually the only one enjoying the influx of local retail investors.
The increasing trend of ETF AUM, coupled with the growing interest of local retail investors in the defense sector, will likely lead to flow improvement in each constituent.
The passive impact of some stocks in the upcoming rebalancing is expected to expand to 0.4-0.5x ADTV. Notable names in this regard are Hanwha Corporation and SNT Motiv.

Weekly Deals Digest (05 Feb) – Pertamina Geothermal, Hesai, Halcyon, Toshiba, Pushpay, O2Micro

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments – Pertamina Geothermal (0125738D IJ) launches a US$600 million IDX IPO and Hesai Group (HSAI US) launches a US$171 million Nasdaq IPO.
Event-Driven developments Halcyon Agri (HACL SP), Toshiba Corp (6502 JP), Nissin Electric (6641 JP), Techno Associe (8249 JP), Pushpay Holdings (PPH NZ), Nitro Software Ltd (NTO AU), O2Micro International (OIIM US).

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Feb 05

Daily Brief Event-Driven: Index Rebalance & ETF Flow Recap: MSCI and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Index Rebalance & ETF Flow Recap: MSCI, ASX, STAR50, China 50, NIFTY100, SMM SP, Pertamina Geo IPO
Halcyon Agri: MGO Triggered. Currency Translation Cuts Offer Price
EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Kanematsu Elect/Sustech, Toshiba, Pushpay, Sembcorp, O2Micro
Inter & Co (INTR US) – No More StoneCo Stake Overhang, but the Fundamental Outlook Remains Tough
Last Week in SPACE: Adani Group, Bendigo/Bank of Queensland, Renault/Nissan, Keisei/Oriental Land

Index Rebalance & ETF Flow Recap: MSCI, ASX, STAR50, China 50, NIFTY100, SMM SP, Pertamina Geo IPO

There were some review cutoffs last week as well as the implementation of the PCOMP INDEX, IDX 30 Index, LQ 45 Index and IDX 80 Index.
The big event in the coming week is the announcement of the MSCI February QCIR on Friday morning Asia time with implementation at the close of trading on 28 February.
Inflows to iShares Core MSCI Emerging Markets ETF (IEMG US) continue while IShares Edge MSCI Min Vol Emerging Markets ETF (EEMV US) continues to see redemptions.

Halcyon Agri: MGO Triggered. Currency Translation Cuts Offer Price

As expected, all conditions to the Sinochem/China Hainan Rubber (601118 CH) SPA have now been satisfied, triggering a mandatory Offer for Halcyon Agri (HACL SP), conditional on a 50% tendering.
Hainan Rubber holds 36%. Sinochem has provided an undertaking notto tender its remaining 29.2% stake. Hainan needs 14% out of 34.8% available – or ~40% to tender.
The takeaway disappointment is the Offer Price of S$0.413/share, down from S$0.435 at the time of the initial announcement last November, due to SGD weakness.

EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades

By Simon Harris

Weekly summary of vol changes and moves across Global Markets
Analysing ATM volatility and skew changes over the last 5 days
We suggest a few trades to take advantage of the implied vol surfaces

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Kanematsu Elect/Sustech, Toshiba, Pushpay, Sembcorp, O2Micro

There are 45 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
Four new deal was discussed on Smartkarma this past week: tender offers for Kanematsu Electronics (8096 JP), Kanematsu Sustech (7961 JP), Nissin Electric (6641 JP), and Techno Associe (8249 JP).
Key updates took place for: Sembcorp Marine (SMM SP), Pushpay Holdings (PPH NZ), Nitro Software Ltd (NTO AU), Toshiba Corp (6502 JP), and O2Micro International (OIIM US).

Inter & Co (INTR US) – No More StoneCo Stake Overhang, but the Fundamental Outlook Remains Tough

By Victor Galliano

StoneCo has disposed of its remaining 4.2% stake in Inter &Co, slamming the door shut on plans for a leading Brazilian neobank-paytech partnership originally announced in May 2021
Stone acquired 5% of Inter for BRL2.5bn in June 2021; the extent of the fintech market malaise means that currently BRL2.5bn (c USD500m) would buy close to 50% of Inter
This StoneCo stake disposal at least removes the Inter shares’ overhang risk; yet despite this technical relief, we reiterate that Inter’s fundamental outlook remains a challenging one

Last Week in SPACE: Adani Group, Bendigo/Bank of Queensland, Renault/Nissan, Keisei/Oriental Land

Stay away from Adani Enterprises (ADE IN). It has wrapped itself in a cloak of nationalistic righteous indignation. Do not buy the dip. Or even a larger one.
The timing of a Bendigo And Adelaide Bank (BEN AU) and Bank Of Queensland (BOQ AU) merger makes a lot of sense right now.
This Renault SA (RNO FP) / Nissan Motor (7201 JP)‘s press release and “agreement”, as-is, is a Nothingburger.

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Feb 04

Daily Brief Event-Driven: Halcyon Agri (HACL SP): Conditions Precedent Fulfilled and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Halcyon Agri (HACL SP): Conditions Precedent Fulfilled, MGO at S$0.413
Pushpay Holdings: 3rd March Scheme Meeting. IA Says Fair
Pushpay (PPH NZ): Scheme Vote on 3 March but Deal Risks Are Emerging
Despature Family/Somfy: Squeeze-Out, Delisting
EQD | SX7E(SX7E Index): Banking Sector Has Been on Fire but Can It Last?
Official Changes in Korea FSC’s Dividend Rules: Ramifications from a Trading Perspective

Halcyon Agri (HACL SP): Conditions Precedent Fulfilled, MGO at S$0.413

The conditions precedent for China Hainan Rubber Industry (601118 CH) to acquire 36.00% of Halcyon Agri (HACL SP)’s outstanding shares from Sinochem International Corporation A (600500 CH) at US$0.315 is fulfilled.
This will trigger an MGO at US$0.315 or S$0.413. On the assumption that the offer document is despatched by 17 February, the earliest close of the offer is 17 March.
The MGO has a 50%+ minimum acceptance condition which requires around 40% of minorities’ acceptance rate. We think that this is achievable as the offer is attractive.

Pushpay Holdings: 3rd March Scheme Meeting. IA Says Fair

Back on the 28 October, church donor management play Pushpay Holdings (PPH NZ/PPH AU) announced a Scheme with BGH/Sixth Street at NZ$1.34/share, a 30.1% premium to undisturbed.
The Scheme Booklet is now out. The shareholder meeting will take place on the 3 March. The independent advisor concluded the Offer price is within its valuation range.
Assuming 11 April payment, this is trading at a gross/annualised spread of 3.0%/18.0%.

Pushpay (PPH NZ): Scheme Vote on 3 March but Deal Risks Are Emerging

Pushpay Holdings (PPH NZ)’s NZ$1.34 offer from Sixth Street/BGH is barely within the IE’s valuation range of NZ$1.33-1.53 per share. There is no “fair and reasonable” statement from the IE.
Astonishingly, Sixth Street/BGH wrote to the Takeovers Panel to raise concerns about the IE’s report. The Takeovers Panel concluded that the IE report is not misleading or deceptive.
A relatively concentrated register poses a risk, particularly considering the IE’s valuation range and the re-rating of a key peer. While possible, the probability of a bump is low.

Despature Family/Somfy: Squeeze-Out, Delisting

By Jesus Rodriguez Aguilar

Shareholders caved in, the Despatures now hold 94.38% of SOMFY’s share capital and 96.31% of voting rights. They asked the AMF for the launch of a squeeze‐out procedure (9 February).
SOMFY will be delisted from Euronext Paris on 9 February. Following the squeeze-out, SOMFY intends to distribute an extraordinary dividend up to €620 million
The total cost for the family is c. €1,285 million (plus investment banking and legal fees). Nearly half of that will be covered by a €620 million extraordinary dividend. Cool.

EQD | SX7E(SX7E Index): Banking Sector Has Been on Fire but Can It Last?

By Simon Harris

SX7E broke out of its range and has rallied 15% this year alone
ECB are close to the end of their hiking cycle and a lot of good news is already priced
Recessionary fears still remain in Europe and we see an opportunity to hedge recent gains whilst vols are low

Official Changes in Korea FSC’s Dividend Rules: Ramifications from a Trading Perspective

The new rules allow investors to decide whether to hold the stock until the dividend record date after knowing the dividend amount in advance.
The new rules will be applied starting with the annual dividends for this fiscal year. We will know this year’s yearend dividend amount before deciding whether to receive it.
From a trading perspective, the yearend dividend arb targeting ex-date mispricing will no longer be effective, which will likely change the swing trading strategy at the beginning of the year.

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Feb 03

Daily Brief Event-Driven: Sumitomo Elec Buys Out Sub Techno Associé) At ¥1 and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Sumitomo Elec Buys Out Sub Techno Associé) At ¥1,695/Share – Insulting Explanation. Deserves More.
Sumitomo Electric Buys Out Sub Nissin Electric (6641) At ¥1,700/Share – ATH But Still Too Low
Quiddity Primer: The Ongoing Evolution of the Hang Seng Index
Keisei Electric: Needs Activists to Push the Market
Nissin Electric (6641 JP): JPY1,700 Tender Offer from Sumitomo Electric
O2Micro Shareholders Approve Merger. Completion Remains Opaque
Bendigo Adelaide Bank & Bank of Queensland’s Rumoured Merger
Dentium: An Undervalued Corporate Activist Target + Likely Inclusion Candidate for KOSPI 200 in 2023
Selected European Holdcos and DLC: January‘23 Report
Pertamina Geothermal Energy IPO: Offering Details & Index Inclusion

Sumitomo Elec Buys Out Sub Techno Associé) At ¥1,695/Share – Insulting Explanation. Deserves More.

Sumitomo Electric Industries (5802 JP) is taking over to subs through tender offers. Both are light. Both this one for Techno Associe (8249 JP) and the one for Nissin Electric.
Both deals are light -slightly offensive, but in different ways. The Board decisions are more offensive than the actual prices, but it’s Sumi Elec buying, so those are offensive too.
There’s a history here. Sumi Elec went to 51% at an offensively low price (EV/EBITDA below zero) in 2019. But this is probably a done deal anyway.

Sumitomo Electric Buys Out Sub Nissin Electric (6641) At ¥1,700/Share – ATH But Still Too Low

Sumitomo Electric Industries (5802 JP) has announced a takeover of two of its subsidiaries today. The larger one is Nissin Electric (6641 JP).
This deal, done for governance purposes, hits an all-time high price. But, like others, it ignores synergies in pricing, has an inadequate premium, and process is just bad.
But given the shareholder structure, this is highly likely to sail through un-molested.

Quiddity Primer: The Ongoing Evolution of the Hang Seng Index

The Hang Seng Index (HSI INDEX) is a blue-chip index that represents the performance of the large cap stocks listed in the Hong Kong Stock Exchange.
The index is undergoing some significant composition changes and the index provider currently uses a highly subjective constituent selection process which is quite challenging to decode.
In this insight, we take a look at Quiddity’s approach to solving this Hang Seng constituent selection puzzle and the historical performance of past rebalance events.

Keisei Electric: Needs Activists to Push the Market

By Oshadhi Kumarasiri

We think there’s something fundamentally wrong with Keisei Electric Railway Co (9009 JP)’s current valuation.
Its core business with an estimated fair value of ¥720bn, currently has an implied valuation of negative ¥942bn (stub value).
If investors can convince the management to dispose its stake in Oriental Land (4661 JP), we think there’s more than a 200% upside to Keisei Electric’s valuation.

Nissin Electric (6641 JP): JPY1,700 Tender Offer from Sumitomo Electric

Nissin Electric (6641 JP) has recommended Sumitomo Electric Industries (5802 JP)’s tender offer of JPY1,700 per share, an 22.7% premium to the undisturbed price (2 February).
The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the offer has been set to meet the 66.67% ownership ratio.
The tender offer is attractive in comparison to peer multiples and historical price ranges. Excluding the offeror, there are no substantial shareholders. This suggests a done deal.

O2Micro Shareholders Approve Merger. Completion Remains Opaque

At the EGM held on January 31, O2Micro International (OIIM US)’s shareholders voted in favoor of the Merger Agreement.
The Offerors didn’t have the necessary two-thirds for the voter to be a foregone conclusion, therefore the outcome wasn’t assured. Although it was an okay offer. With proxy advisor support.
Yet even after the vote, this is still trading 7.1% below terms. The drawn-out completion of Glory Star New Media Group Holdings (GSMG US) is evidently uppermost in investors’ minds.

Bendigo Adelaide Bank & Bank of Queensland’s Rumoured Merger

The Aussie local press is discussing renewed merger talks for Bendigo And Adelaide Bank (BEN AU) and Bank Of Queensland (BOQ AU).
Talks of a merger are not new. And we have been here before when BOQ twice made overtures to Bendigo in 2007, but was rejected.
The swift removal of BOQ’s CEO, a lifetime high ratio – BEN/BOQ – and ANZ (ANZ AU)‘s tilt for Suncorp Bank – suggests a merger makes a lot of sense.

Dentium: An Undervalued Corporate Activist Target + Likely Inclusion Candidate for KOSPI 200 in 2023

By Douglas Kim

We believe Dentium is an attractive stock to own right now. It has an excellent combination of strong growth in sales and profits and discounted valuations.
Driven by its strong share price appreciation in the past year, Dentium now has become a strong candidate for a potential inclusion in KOSPI 200 index in 2023.
There is a growing probability that Dentium could be targeted by corporate activists to pressure the company to cancel treasury shares and provide higher dividends.

Selected European Holdcos and DLC: January‘23 Report

By Jesus Rodriguez Aguilar

Discounts to NAV of covered holdcos have generally tightened since New Year. Discounts to NAV (31 January): C.F.Alba, 49.7%; GBL, 35.3%; Heineken Holding, 17.4%; Industrivärden C, 13.8%; Investor B, 11.4%;
Porsche Automobile Holding, 47.4%. The spread of Rio Tinto DLC widened to 14.8%. Spreads tend to widen in bear markets but short-term recoveries provide opportunities on tightening discounts.
Recommended trades are: GBL, Porsche Automobile Holding, Rio Tinto (DLC), CF Alba (long position).

Pertamina Geothermal Energy IPO: Offering Details & Index Inclusion

Pertamina Geothermal (0125738D IJ) is offering 10.35bn shares in its IPO at a price range of IDR 820-945/share to raise between US$567-653m and valuing the company between US$2.27-2.61bn.
The stock will not get fast entry to the MSCI, FTSE or local Indonesia indices (IDX30 Index/ LQ45 Index/ IDX80 Index).
The stock should be added to MSCI Small Cap in May and to the FTSE All-Cap in September bringing in some passive flow.

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Feb 02

Daily Brief Event-Driven: Oriental Land (4661) As Nikkei 225 Candidate – What Is Float? What Is “The Tricky Twist”? and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Oriental Land (4661) As Nikkei 225 Candidate – What Is Float? What Is “The Tricky Twist”?
Sembcorp Marine & Keppel O&M: STI Inclusion Possibility & Other Index Flow
TOPIX Index Upweights: An Early Preview Of “The Big April Basket” 2023
Greatview Aseptic (468 HK): Rival Purchases And Grandstanding
(Mostly) Asia M&A, Jan 2023: Essential Metals, Relia Inc, Osstem Implant, Esso Thailand
O2Micro (OIIM US): US$5 Privatisation Approved, Spread Remains Wide

Oriental Land (4661) As Nikkei 225 Candidate – What Is Float? What Is “The Tricky Twist”?

As discussed in Nikkei 225 March Review – Quiddity Leaderboard (Jan 2023) (and earlier versions), Oriental Land (4661 JP) is a candidate to join the Nikkei 225 in March 2023.
As of early January, it was the top-ranked impact name with 11.8 days of ADV to buy, and if it underperformed the Nikkei from there, there’d be more to buy.
With the data collection period now complete, it is top-ranked, still. And it is still ~10-12 days to buy. Understanding shareholder structure, however, is key. So I dive in.

Sembcorp Marine & Keppel O&M: STI Inclusion Possibility & Other Index Flow

The Sembcorp Marine (SMM) EGM is scheduled for 16 February. If approved by shareholders, the Asset Co transaction and completion of the KOM restructuring will be done by 28 February.
We expect no market trade from FTSE trackers, buying from MSCI trackers, while there is a question mark over treatment in the FTSE Straits Times Index (STI) (STI INDEX).
There could be selling in Sembcorp Marine (SMM SP) from active Keppel Corp (KEP SP) shareholders and that could have a bigger impact on the stock.

TOPIX Index Upweights: An Early Preview Of “The Big April Basket” 2023

The Tokyo Stock Exchange (TSE) calculates Free-Float Weight (FFW) for each listed company and uses this value as a key component of TOPIX Index Calculation.
For companies with “low liquidity” the FFW will be multiplied by a fixed liquidity factor of 0.75 to derive the final FFW used for index calculation.
Every April, the application of this liquidity factor is reviewed by the TSE. In this insight, we take an early look at what could happen in April 2023.

Greatview Aseptic (468 HK): Rival Purchases And Grandstanding

After Greatview Aseptic (468 HK) was suspended on the 30 January, it emerged that Shandong Xinjufeng (301296 CH) had entered a SPA to acquire Jardine Matheson (JM SP)‘s 28.22% stake
Greatview has now confirmed the transaction. Shares were supposed to resume trading this afternoon but were immediately suspended again.
Importantly, Inner Mongolia Yili Industrial Group (A) (600887 CH), Xinjufeng’s largest customer is a main competitor of Greatview’s largest customer. That may be an untenable situation, according to the announcement.

(Mostly) Asia M&A, Jan 2023: Essential Metals, Relia Inc, Osstem Implant, Esso Thailand

For the month of January, four new deals (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$3bn.
The average premium for the new deals announced (or first discussed) in January was ~28%, which is distorted by the take under for Esso Thailand (ESSO TB).
This compares to the average premium for all deals in 2022 (106 deals), 2021 (165 deals), 2020 (158 deals), and 2019 (145 deals) of 41%, 33%, 31%, and 31% respectively.

O2Micro (OIIM US): US$5 Privatisation Approved, Spread Remains Wide

O2Micro International (OIIM US)‘s US$5.00 per ADS privatisation offer from FNOF Precious Honour Limited was overwhelmingly approved by shareholders.
The key remaining condition precedent is obtaining the required regulatory approvals related to the listing rules of NASDAQ and the Cayman Islands. There are no Chinese regulatory approvals required.
The conditions precedent should be satisfied shortly. At the current price and for an end-March close, the gross and annualised spread to the offer is 6.4% and 45.6%, respectively.

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Feb 01

Daily Brief Event-Driven: StubWorld: Mickey Upstages Keisei Electric and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

StubWorld: Mickey Upstages Keisei Electric
MSCI Feb 2023 QCIR Preview: Potential Changes as Review Period Ends
Toshiba (6502) – Funding Mostly Secured, Still, Again, Maybe. Or Maybe Not. Or Not.
Sembcorp Marine-Keppel O&M Merger Circular Squeaks In Under The Wire – Next Steps
Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms
Dufry/Autogrill: Deal Progress
ActivistTalk: Bed Bath & Beyond at Death’s Door

StubWorld: Mickey Upstages Keisei Electric

Keisei Electric Railway Co (9009 JP) is trading “cheap” as Oriental Land (4661 JP) enjoys a zero-Covid revival.
Preceding my comments on Keisei/Oriental Land, 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%.

MSCI Feb 2023 QCIR Preview: Potential Changes as Review Period Ends

The review period for the February Quarterly Comprehensive Index Review (QCIR) of the MSCI indices ended yesterday. There will be a number of changes in the Asia Pacific region.
Most of the inclusions are in China and the country weight in the MSCI Emerging Markets Index should increase leading to outflows from other markets.
On average, the potential adds have outperformed the potential deletes over the last few weeks. At a glance, pre-positioning appears to be lighter than in the past.

Toshiba (6502) – Funding Mostly Secured, Still, Again, Maybe. Or Maybe Not. Or Not.

The original bid was supposed to be presented fully-funded by 30 September 2022. Then it was early November, then late November, then early December, late Dec, early Jan, end Jan.
Today we find out that The Banks and The Preferred JIP Bidding Consortium will aim to reach agreement by 3 Feb. The Bloomberg article details are newish, and odd.
Shares have deteriorated and vs Peers, they are at their lowest point in many months. And the details do not make me confident this deal is clean yet.

Sembcorp Marine-Keppel O&M Merger Circular Squeaks In Under The Wire – Next Steps

Last Friday, Sembcorp Marine (SMM SP) announced it had Approval-In-Principle for its Proposed Combination with Keppel Corp (KEP SP), contingent on the Circular being despatched by 31 January 2023.
At 6:50pm local time on 31 January, Sembcorp Marine released its 679-page Circular (and EGM Announcement (16 Feb EGM)). Phew!
Now we have a deal in sight, we have to think about next steps. SMM NEWCO needs a story vs flow. Orderbook is nice but may not cut it near-term.

Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms

Bloomberg reports that Japan Industrial Partners (JIP), the preferred bidder, has again extended the deadline for securing bank financing of around JPY1.2 trillion (US$8.8 billion).
A new issue has pushed the deadline to 3 February. If JIP manages to secure financing for an offer of around JPY5,100, the next challenge is securing Board support.
The 3QFY2022 update on 14 February needs to avoid further downgrades to keep the deal alive. Toshiba’s multiples are unattractive to peers. Remain on the sidelines for now.

Dufry/Autogrill: Deal Progress

By Jesus Rodriguez Aguilar

The deal is done with the transfer of Edizione’s 50.3% stake in Autogrill under way, and with all main hurdles cleared. Dufry must launch and offer to buy out minorities.
Autogrill shares closed at €6.698 on 30 January, also the implied value of the 0.158 Autogrill/Dufry share swap is 5.8% above the €6.33/share “initial” cash offer. The market expects more.
The deal will not fall through but the price is still being negotiated, possibly around €6.8-6.9/share. The issue will now become what dilution/leverage will Dufry’s patient shareholders endure.

ActivistTalk: Bed Bath & Beyond at Death’s Door

By Robert Sassoon

Bed Bath & Beyond (BBBY US) , the one-time iconic US homes good retailer, whose financial condition has continued to deteriorate rapidly, is barreling towards bankruptcy sooner rather than later
A default notice on one of its primary credit facilities has been served and failure to make a bond interest payment on Feb 1 could well seal its fate
There may not be any money left for its equity holders to recover which means there is a real prospect of the BBBY share price moving rapidly to zero

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Jan 31

Daily Brief Event-Driven: Adani Ent FPO – Early Demand Muted and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Adani Ent FPO – Early Demand Muted, Adani & Hindenburg Trade Barbs Again, But Not a Good Look
Renault & Nissan “Agree” On New Terms – A Diet Nothing🍔, Exchangeable into Shaq Fingerguns
Quiddity Flow Expectations HSTECH Mar 23: Two Index Changes Possible
Matheson To Exit Greatview Aseptic
TOPIX Inclusion: AXXZIA Inc (4936 JP) – Time to Take Profits
STAR50 Index Rebalance Preview: 5 Changes Forecast as Review Period Ends
JPX-Nikkei 400 Rebal 2023: End-Jan 2023
HMM Is Likely the First to Be Subject to the Mandatory Offer that Comes into Force
Greatview Aseptic (468 HK): Xinjufeng Technology Acquires Jardine Matheson’s Stake
Osstem Implant: Details of Tender Offer & Chairman Choi’s Children Exchange CB Call Options for BWs

Adani Ent FPO – Early Demand Muted, Adani & Hindenburg Trade Barbs Again, But Not a Good Look

The Adani Enterprises (ADE IN) FPO saw VERY muted demand (realtime available on NSE+BSE websites) on Day 1 Friday as the share price plummeted through the bottom of the range.
The Adani Group responded to Hindenburg late Sunday with a 400-page rebuttal, cloaked in nationalistic terms. Hindenburg responded saying the company failed to answer 62 of 88 questions.
This is not going away. They could lower the FPO price, or just pull the FPO. That won’t materially change the significant over-valuation of many Adani Group listco share prices.

Renault & Nissan “Agree” On New Terms – A Diet Nothing🍔, Exchangeable into Shaq Fingerguns

Today, a Nikkei article suggested (after other media suggested last week) that Renault SA (RNO FP) and Nissan Motor (7201 JP) have come to agreement about their new deal.
Post-Close, an announcement. Two striking things about this “agreement” a) it comes many months after they started negotiating, and b) we have few details, and c) we’re missing a bit.
Renault agrees to cap voting rights in Nissan. Nissan agrees to invest in RNO’s EV spinoff, and so far, they agree to strengthen the Alliance. What’s missing is interesting/key.

Quiddity Flow Expectations HSTECH Mar 23: Two Index Changes Possible

In this insight, we take a look at the potential index changes and the resultant capping flows for the Hang Seng Tech Index (HSTECH INDEX) in March 2023.
According to our estimation, there could be two changes for the HSTECH in March 2023 and there could be one-way index flows of US$365mn.
The final index changes along with indicative capping and index weights could be published in Mid/Late-February 2023 and implemented in early-March 2023.

Matheson To Exit Greatview Aseptic

Shandong Xinjufeng Technology Packaging (301296 CH) is seeking to acquire Jardine Matheson Holdings (JM SP)‘s 28.22% stake in Greatview Aseptic Packaging (468 HK) at HK$2.65/share.
Greatview is currently suspended “pending the release of an announcement which contains inside information“, suggesting there is no follow on Offer for remaining shares.
Elsewhere, Matheson has resumed its share repurchase program, providing near-term support.

TOPIX Inclusion: AXXZIA Inc (4936 JP) – Time to Take Profits

Japan-Based skincare and cosmetics maker AXXZIA Inc (4936 JP) announced on 9th November 2022 they were planning to move from TSE Growth to TSE Prime.
Travis Lundy was Bullish on this name as he discussed in AXXZIA (4936 JP) – TOPIX Inclusion Is Likely In February and the stock has gained around 12% since then.
Today after the close, AXXZIA Inc (4936 JP) announced they had received the approval for their Prime Market move in February which could lead to a TOPIX Inclusion in March.

STAR50 Index Rebalance Preview: 5 Changes Forecast as Review Period Ends

The review period for the March rebalance ends today. We forecast 2 changes using a 12-month minimum listing history, and 5 changes using a 6-month minimum listing history.
We expect the index committee to continue using a 6-month minimum listing history. The impact on the potential deletes is a lot higher than the impact on the potential adds.
With 5 changes to the index, estimated one-way turnover is 5.1% resulting in a one-way trade of CNY 4,549m. There is a reasonably large reverse funding trade.

JPX-Nikkei 400 Rebal 2023: End-Jan 2023

JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2023 based on trading data as of end-January 2023.

HMM Is Likely the First to Be Subject to the Mandatory Offer that Comes into Force

KDB recently initiated the process of selecting an advisory firm to sell its stake in HMM, which will likely be the first to implement the mandatory offer rule.
Potential bidders include Hyundai Glovis, LX Holdings, and Samsung SDS. As for POSCO Holdings, it recently said that it is not considering acquiring HMM.
Given that HMM is the only national shipping company, there is a good chance that multiple bidders will appear, which will lead to a premium to the market price.

Greatview Aseptic (468 HK): Xinjufeng Technology Acquires Jardine Matheson’s Stake

Shandong Xinjufeng Technology Packaging (301296 CH) agreed to acquire Jardine Matheson Holdings (JM SP)’s 28.22% stake in Greatview Aseptic Packaging (468 HK) at HK$2.65 per share.
Post-Completion, Xinjufeng will be the largest shareholder. As Xinjufeng’s shareholding will remain below the 30% voting threshold, the transaction will NOT result in a mandatory general offer.
The transaction price, which is a 22.7% premium to the last close, highlights Greatview’s value. Greatview’s forward P/E multiple is undemanding in comparison to peer P/E multiples.

Osstem Implant: Details of Tender Offer & Chairman Choi’s Children Exchange CB Call Options for BWs

By Douglas Kim

We provide details of the Osstem Implant tender offer as well as Chairman Choi’s children exchange of CB call options for BWs.
We believe that the majority of the minority shareholders in Osstem Implant are not likely to sell their shares at 190,000 won per share but hold on to it.
Over a longer time frame, Osstem’s share price could reach higher levels driven by its improving sales and profit growth, deep valuation discount to global peers, and further M&A fight.

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Jan 30

Daily Brief Event-Driven: MSCI Wants a Consult on Adani Group – I’m Not Sure What They Can Do and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

MSCI Wants a Consult on Adani Group – I’m Not Sure What They Can Do
Clarifications About Osstem Implant Tender Event
Korea No Longer Collects Foreigners’ Real-Time Trade Data & Potential Increase in Spoofing Attempts
NIFTY100 Index Rebalance Preview: Big Impact & Could Increase Due to Capping
Merger Arb Mondays (30 Jan) – Kanematsu, Toyo, O2Micro, Origin Energy, Warrego, Tyro, Norwest
Quiddity Flow Expectations HSCEI Mar 23: One Change + Caps for Meituan, Alibaba, and Tencent
S&P/ASX Index Rebalance Preview: High Impact Changes in March

MSCI Wants a Consult on Adani Group – I’m Not Sure What They Can Do

The Adani Group listcos have been on a wild ride for the last few years, rising from 10x TTM EV/EBITDA in March 2020 to 60x at end-September 2022.
Adani Group “business incubator’ Adani Enterprises (ADE IN) last fall indicated it might raise $2.4bn of equity and combined 6 co market cap is down $135bn since.
A short seller report last week put the cat amongst the pigeons. Now MSCI is consulting investors about what it might do regarding Things.

Clarifications About Osstem Implant Tender Event

The acquirer would cancel the deal unless at least 2.394M shares (15.4% of SO) were tendered. This is the minimum purchase quantity condition that will trigger a cancellation.
If the minimum purchase volume is exceeded, will there be a pro rata allocation risk? The answer is no. The acquirer will purchase all the tendered shares
The cancellation risk seems slim as only 15.4% of the SO should be tendered, which doesn’t seem to be a challenging target.

Korea No Longer Collects Foreigners’ Real-Time Trade Data & Potential Increase in Spoofing Attempts

KRX (and Korea FSS) no longer collects foreign investors’ entire trade records in real time, as foreign investors are no longer traced based on their unique registration numbers.
Foreign investors are likely to engage in more aggressive short-term trading. We need to be prepared for significant price volatility, mainly for small and mid-cap stocks.
System changes for trade history management changes will be completed within the third quarter. So, we will likely witness new trading patterns from the fourth quarter of this year.

NIFTY100 Index Rebalance Preview: Big Impact & Could Increase Due to Capping

There are 2 trading days left in the review period. We expect 5 changes at the rebalance that will be announced end-February and implemented at the close on 30 March.
A lot of the stocks were AMFI migrations and Biocon Ltd (BIOS IN) is a potential deletion from the MSCI India Index at the February QCIR.
The drop in the Adani Group stocks that are part of the index will result in passive inflows on the non-F&O constituents due to capping at 15% of index weight.

Merger Arb Mondays (30 Jan) – Kanematsu, Toyo, O2Micro, Origin Energy, Warrego, Tyro, Norwest

We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads – Alliance Aviation Services (AQZ AU), Kanematsu Electronics (8096 JP), 21Vianet Group (VNET US), Golden Energy & Resources (GER SP), Origin Energy (ORG AU), 111 Inc (YI US).
Lowest spreads – Essential Metals (ESS AU), Chip Eng Seng Corp (CHIP SP), Nitro Software Ltd (NTO AU), Norwest Energy NL (NWE AU), Conexio Corp (9422 JP), Nippon Steel Trading.

Quiddity Flow Expectations HSCEI Mar 23: One Change + Caps for Meituan, Alibaba, and Tencent

In this insight, we take a look at the potential index changes and the resultant capping flows for the Hang Seng China Enterprises Index (HSCEI INDEX) in March 2023.
According to our estimation, there could be one change for the HSCEI in March 2023 and there could be one-way index flows of US$440mn.
The final index changes along with indicative capping and index weights could be published in Mid/Late-February 2023 and implemented in early-March 2023.

S&P/ASX Index Rebalance Preview: High Impact Changes in March

We currently see 1 change for the ASX20, 2 for the ASX100, 4 changes for the ASX 200 and 9 adds/ 6 deletes for the ASX300 Index in March.
Passive trackers will need to trade over 3 days of ADV on 13 stocks, over 5 days of ADV on 9 stocks and over 10x ADV on 4 stocks.
Shorts have been covering positions on stocks where there are expected to be passive inflows and increasing positions on stocks that are expected to have passive outflows.

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Jan 29

Daily Brief Event-Driven: Adani Group: Hindenburg Report Spurs MSCI to Invite Feedback and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Adani Group: Hindenburg Report Spurs MSCI to Invite Feedback
Names to Watch for Inclusion in MSCI Korea May Review
Kanematsu Electronics (8096 JP): JPY6,200 Tender Offer from Kanematsu Corporation
Kanematsu Sustech (7961) ¥2250/Share Tender Offer by Parent – Supremely Illiquid But Interesting
Index Rebalance & ETF Flow Recap: NKY, LQ45, New Deal, URA, NIFTY, Stock Connect, SenseTime, Adani
Last Week in SPACE: Kawasaki Kisen Kaisha, Osstem, Fujitsu General, Adani Enterprises
Weekly Deals Digest (29 Jan) – AAG Energy, Acotec, Xingda, Origin Energy, Tyro, Kanematsu, Toyo
Kanematsu Electronics (8096) – ¥6200/Share Tender Offer by Parent – Easy Takeout
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Osstem, Warrego, Norwest Energy, Acotec, Sabana, Jafco, Toyo
EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades

Adani Group: Hindenburg Report Spurs MSCI to Invite Feedback

The Adani Group stocks have taken a dive following the Hindenburg Research report. Group market cap is down more than US$47bn with company promoters taking the biggest hit.
The Adani Enterprises FPO is almost certain to be undersubscribed. MSCI, in an unprecedented step, is monitoring publicly available information and is seeking feedback from the investment community.
We find that the real float of some Adani Group stocks is much lower than the headline numbers and there could be selling if MSCI lowers the FIF.

Names to Watch for Inclusion in MSCI Korea May Review

Posco International‘s recent merger with Posco Energy increased the share count. The distance from the float market cap borderline is catchable, given the current share price uptrend.
Hanwha Aerospace will likely fail inclusion in this February review. The gap with the hurdle is not large, so it can aim for inclusion in the May review.
Among Outside IMI, Korea Gas is tricky as it is a FOL stock. MSCI-concluded float is 30%, and the gap with the float market cap hurdle is still quite large.

Kanematsu Electronics (8096 JP): JPY6,200 Tender Offer from Kanematsu Corporation

Kanematsu Electronics (8096 JP) has recommended Kanematsu Corp (8020 JP)’s tender offer of JPY6,200 per share, an 32.9% premium to the undisturbed price (27 January).
The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the offer has been set to meet the 66.67% ownership ratio.
The tender offer is attractive as it represents an all-time share price high and a premium to peer multiples. This suggests a done deal.

Kanematsu Sustech (7961) ¥2250/Share Tender Offer by Parent – Supremely Illiquid But Interesting

Kanematsu Corp (8020 JP) announced two tender offers late Friday to take out minorities in subsidiaries. One larger, safer deal. One smaller, illiquid, but potentially interesting one.
This is the interesting one. It is being done at the wrong price, and it has investors who might care who have been long-time holders.
This could get interesting. You have a buyer. A target. It’s pretty clean except for shareholder structure. And the buyer has room to pay up.

Index Rebalance & ETF Flow Recap: NKY, LQ45, New Deal, URA, NIFTY, Stock Connect, SenseTime, Adani

The review period for the upcoming rebalance of the MSCI, Nikkei 225, NIFTY, Nifty Next 50, SSE STAR50 and KRX New Deal Indices ends on 31 January.
The IDX30, LQ45, IDX80, Global X Uranium ETF (URA US) rebalances will be implemented on 31 January while the PSEi Index (PCOMP INDEX) rebalance will be implemented on 3 February.
There were inflows to Asian country ETFs and iShares MSCI Emerging Markets (EEM), and outflows from IShares MSCI Min Vol EM ETF (EEMV) and iShares MSCI Pacific ex Japan (EPP).

Last Week in SPACE: Kawasaki Kisen Kaisha, Osstem, Fujitsu General, Adani Enterprises

Be long Kawasaki Kisen Kaisha (9107 JP) vs MOL and NYK. The shares are cheap on a forward basis. KLine is reducing the Real World Float, causing further potential squeeze.
Sabana Industrial REIT (SSREIT SP)‘s Partial Offer at 0.88x book is not overwhelming, but it is also not a control stake. It is probably priced near-right.
IF Osstem (048260 KS)‘s price were to go higher, it is conceivable there could be a bump, but don’t bet on it as long as the stock trades <KRW 190,000.

Weekly Deals Digest (29 Jan) – AAG Energy, Acotec, Xingda, Origin Energy, Tyro, Kanematsu, Toyo

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments – New Ruipeng Pet Group (RPET US) and Hesai Group file for US$100 million IPOs for listing in the US.
Event-Driven developments – Aag Energy Holdings (2686 HK), Acotec Scientific Holdings (6669 HK), Xingda International (1899 HK), Kanematsu Electronics (8096 JP), Toyo Construction (1890 JP), Origin Energy (ORG AU).

Kanematsu Electronics (8096) – ¥6200/Share Tender Offer by Parent – Easy Takeout

Kanematsu Corp (8020 JP) announced two tender offers Friday to take out subsidiaries. One more liquid one. One very small sub. This is the larger, easier deal.
Kanematsu Electronics is an IT shop, designing and executing system integration and maintenance services. It is a great business. The takeout is a 33% premium to an all-time high.
It might still be a bit cheap, but it is not egregious, and it would be quite difficult to block.

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Osstem, Warrego, Norwest Energy, Acotec, Sabana, Jafco, Toyo