Event-Driven Archives | Page 116 of 187 | Smartkarma

Great Panther (GPL US) is a deletion from the VanEck Vectors Junior Gold Miners ETF (GDXJ US). There are a lot of float changes that will result in passive flows.
One way turnover is estimated at 3.4% and will result in a one-way trade of US$106m at the September rebalance.
Most index constituents have traded poorly over the last few months and the stocks with passive inflows could outperform their peers in the short-term.

MVIS Global Rare Earth/Strategic Metals Index Rebalance: Three Adds, Two Deletes

Sayona Mining (SYA AU), Sigma Lithium (SGML US) and Tianqi Lithium (9696 HK) will replace Australian Strategic Materials (ASM AU) and Sierra Rutile Holdings (SRX AU) in the index.
Sayona Mining (SYA AU) is also an inclusion to the FTSE All-Cap and S&P/ASX 200 on the same day as the VanEck Vectors Rare Earth/Strategic Metals ETF (REMX US) addition.
We had Sayona Mining (SYA AU) and Tianqi Lithium (9696 HK) as potential adds while Australian Strategic Materials (ASM AU) and Sierra Rutile Holdings (SRX AU) were high probability deletes.

Korea ETF Market Size Breakdown from a Flow Trading Perspective

There are 611 ETFs with a combined AUM of ₩76T. Korea is in the global top 7. ₩32T worth of ETFs belongs to local equity, half of which are index-trackers.
The market began to pay attention to the less crowded areas. The result is the rise of sector ETFs. Sector-type has also grown significantly, now with an AUM of ₩8.4T.
Lower predictability causes their rebalancings to be relatively less crowded. That is, the profit effect of acquiring prior information is much more dramatic on the day of rebalancing trading.

Last Week in Event SPACE: SOHO China, Nikkei 225 Review, SK Chemicals, SingTel, Porsche, Tyro

Soho China (410 HK)‘s Pan Shiyi is resigning to focus on “philanthropic pursuits”. That sounds like “donations”, which can be sourced from the Pans selling their stake in SOHO.
In the Nikkei 225 Annual Review, Nidec (6594 JP), SMC (6273 JP), Hoya (7741 JP) are IN. Unitika (3103 JP), Maruha (1333 JP), and Oki Electric (6703 JP) are OUT.
Volkswagen (VOW GR) confirms its intention to float a portion of its Porsche sports-car brand within weeks, in what is expected to be one of Germany’s largest-ever public debuts.

Weekly Deals Digest (11 Sep) – Giordano, DTAC/True, Link Admin, Nitro, Tyro, Ramsay, CALB, Onewo

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments – Leapmotor (2007699D HK), Onewo Space-Tech (ONEWO HK) and CALB (CALBLZ CH) are pre-marketing a US$1.5 billion, US$2.0 billion and US$2.0 billion HKEx IPOs, respectively.
Event-Driven developments – DTAC/True, Giordano International (709 HK), Link Administration (LNK AU), MyDeal.com.au Ltd (MYD AU), Nitro Software Ltd (NTO AU), Resapp Health (RAP AU), Tyro Payments (TYR AU).

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Tyro, Shidax, Link Admin, Giordano, Hitachi Transport

There are 49 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
Two new deals were discussed this week: Potentia’s rejected proposal forTyro Payments (TYR AU) and Oisix ra daichi (3182 JP)‘s tilt for Shidax Corp (4837 JP).
Key updates took place for Link Administration (LNK AU), Giordano International (709 HK), and Hitachi Transport System (9086 JP).

Index Rebalance & ETF Flow Recap: NKY, HSCEI, REMX, GDXJ, Link Admin

The last week had the announcement of the Nikkei 225 (NKY INDEX) September changes and the implementation of the SSE STAR50 (STAR50 INDEX) rebalance.
The coming week will have the implementation of the FTSE AW/AC, FTSE China 50/A50, Taiwan 50/Div+, STI, EPRA Nareit, S&P/ASX, REMX and GDXJ rebalances.
There were large outflows from iShares MSCI ACWI ETF (ACWI US) and iShares MSCI Emerging Markets (EEM US) during the week.

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Sep 10

Daily Brief Event-Driven: Tyro Payments Rejects Potentia’s Proposal. MCB Accepts and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Tyro Payments Rejects Potentia’s Proposal. MCB Accepts
Poongsan Corp: Spin-Off of Defense Business Is Negative for Existing Minority Shareholders

Tyro Payments Rejects Potentia’s Proposal. MCB Accepts

Tyro Payments (TYR AU) has rejected a proposal from a Potentia-led consortium at A$1.27/share, by way of a Scheme.
Mike Cannon-Brookes’ Grok Ventures, holding 12.5% and Tyro’s largest shareholder, has backed the Offer.
Tyro’s board considered the proposal to be materially below Tyro’s fundamental value and highly opportunistic. Tyro’s share price was down 66% ytd prior to Potentia’s approach.

Poongsan Corp: Spin-Off of Defense Business Is Negative for Existing Minority Shareholders

By Douglas Kim

On 7 September, Poongsan Corp announced a physical division spin-off of its defense business unit. This is likely to have a negative impact on the existing shareholders of Poongsan Corp.
Its proposal to spin off the defense business comes at a bad time when investors are very cautious about companies trying to spin off valuable businesses into a separate entity.
Poongsan’s spin-off is excluded from the need to include stock purchase rights.

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Sep 09

Daily Brief Event-Driven: Link Admin (LNK AU): ACCC Approval & Index Changes and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Link Admin (LNK AU): ACCC Approval & Index Changes
Link Admin Gets ACCC Nod. Woodford Condition Outstanding
Link’s Scheme in the Home Stretch by Securing ACCC and CBI Approval
Oisix-Shida Stoush with SHiDAX Suggests Strong but Subtle Strategy
Tyro in Play as It Rejects Potentia’s A$1.27 Offer

Link Admin (LNK AU): ACCC Approval & Index Changes

The ACCC will not oppose the proposed acquisition of Link Administration (LNK AU) by Dye & Durham removing a major hurdle. Other regulatory approvals are still pending.
If regulatory clearances are received in the next week and the Court approves the Scheme, Link Administration (LNK AU) will stop trading at the close on 15 September.
We estimate passive trackers across all indices will need to sell 35.53m shares (A$153m; 18 days of ADV) of Link Administration (LNK AU) at the close on 15 September.

Link Admin Gets ACCC Nod. Woodford Condition Outstanding

Link Administration (LNK AU) has announced the Australian Competition and Consumer Commission will not oppose Dye & Durham’s proposed acquisition.
The next step is the rescheduled second court hearing on the 15 September.
The key outstanding condition concerns the “Woodford Matters”, and whether D&D potentially waives this condition, or digs in its heels.

Link’s Scheme in the Home Stretch by Securing ACCC and CBI Approval

Dye & Durham/DND’s proposed acquisition of Link Administration (LNK AU) at A$4.81 per share has received approvals from the ACCC and the Central Bank of Ireland.
Key conditions precedent remaining are FIRB, UK FCA and Luxembourg approvals. The second court hearing date has been adjourned to 15 September.
The transaction is in the home stretch and will likely complete. At the last close, the gross and annualised spread for a 27 September payment is 4.8% and 151%, respectively.

Oisix-Shida Stoush with SHiDAX Suggests Strong but Subtle Strategy

Shidax Corp (4837 JP) is a food service business in the midst of a so-far reasonably successful restructuring. The family had a partner in Unison and hoped to extend.
The founding family and Unison now have ~60% together, and they vote together. Unison wants out. The family wants Oisix ra daichi (3182 JP) in. So Oisix has tendered.
But SHiDAX sees the conflict and minorities getting hosed. So they object. The “easy” solution is a full MBO with Oisix support.

Tyro in Play as It Rejects Potentia’s A$1.27 Offer

Tyro Payments (TYR AU) rejected an indicative proposal from the Potentia consortium at A$1.27 per share as it was highly conditional and materially undervalued the business.
Grok, the largest shareholder will vote for a Potentia scheme unless there is a rival scheme which is A$0.25 per share higher than the value of the Potentia proposal.
Potentia’s move puts Tyro in play, and Grok’s involvement will force the Board to get an improved offer and/or flush out a competing bidder. There is another round to go.

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Sep 08

Daily Brief Event-Driven: HSCEI Index Rebalance Preview: Could Be A BIG One and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

HSCEI Index Rebalance Preview: Could Be A BIG One
SOHO China (410 HK): Blackstone Deal Potentially Back On As Pan Shiyi Goes “Altruistic”
MVIS Global Rare Earth/Strategic Metals Index Rebalance Preview: Couple of Potential Deletes
Hitachi Transport (9086 JP) – Tender Launch Likely Soon But Watch for Flow
KRX New Deal Index Rebalance: All Forecasts Right as KMW Soars and AfreecaTV Drops
KRX K-New Deal Rebalancing: Official Results & Passive Flows
DTAC/True Merger: NBTC Likely to Set Measures to Approve Merger
Major Stock Swap Between Hyundai Motor Group and KT Corp
Hong Kong CEO & Director Dealings – 1st Sept 2022: A8 New Media, China Fordoo
Intention to Float Porsche AG: A Good Deal for Porsche Automobile Holding SE

HSCEI Index Rebalance Preview: Could Be A BIG One

There could be up to 6 changes to the Hang Seng China Enterprises Index (HSCEI INDEX) at the December rebalance, mainly driven by the deletions.
If there are six changes to the index, estimated one-way turnover is 6.47% and will result in a one-way trade of HK$4,124m.
There is large short interest on quite a lot of stocks and will play an important role in the rebalance.

SOHO China (410 HK): Blackstone Deal Potentially Back On As Pan Shiyi Goes “Altruistic”

Pan Shiyi and Pan Zhangxin – Chairman and CEO respectively of SOHO China (410 HK) – have tendered their resignations, with immediate effect.
Both are resigning “to focus on supporting the arts and philanthropic pursuits“.
That sounds like a “donation” is on the cards. And the Pans selling their stake in SOHO China would nicely fund that donation.

MVIS Global Rare Earth/Strategic Metals Index Rebalance Preview: Couple of Potential Deletes

Sierra Rutile Holdings (SRX AU) is a high probability delete from the index, while Australian Strategic Materials (ASM AU) is close to the deletion threshold.
Sayona Mining (SYA AU) is the highest ranked non-constituent while Tianqi Lithium (9696 HK) only makes inclusion at the entire IPO raise.
Deletion from the index will require passive trackers to sell over 5 days of ADV on Australian Strategic Materials (ASM AU).

Hitachi Transport (9086 JP) – Tender Launch Likely Soon But Watch for Flow

Hitachi Transport System (9086 JP) has had a “long” wait to get its approvals, but EC and China are in, any remaining should be in shortly.
Yesterday, as a footnote on the SG Holdings offering document, there was a comment about SG Holdings selling shares. This was likely more good corporate governance hygiene than warning.
Shares are down this morning. I’d expect final approvals and launch quite soon. I would therefore look to buy the dip on flow – block or not.

KRX New Deal Index Rebalance: All Forecasts Right as KMW Soars and AfreecaTV Drops

The KRX announced the changes to the KRX New Deal indices post market close on Friday. But the changes were not made public and are only available to subscribers.
Intellian Technologies (189300) and Seojin System (178320) replace Danal (064260) and Kcp (060250) in the Internet Index, while KMW Co Ltd (032500 KS) replaces AfreecaTV (067160 KS) in BBIG.
Since we published our last forecast on 21 July, KMW Co Ltd (032500 KS) is up 12% while AfreecaTV (067160 KS) has dropped 17%.

KRX K-New Deal Rebalancing: Official Results & Passive Flows

KMW replaces AfreecaTV in BBIG. There is no constituent change for Battery and Bio. Seojin and Intellion replace NHN KCP and Danal in Internet. Nexon Games replaces Devsisters in Game.
The effective date has been postponed to the 13th, and the ETF operators will conduct the rebalancing trading at the close tomorrow, the 8th.
Regarding relative passive impact, KMW and AfreecaTV should receive the most attention, and this pattern is already appearing today.

DTAC/True Merger: NBTC Likely to Set Measures to Approve Merger

The Bangkok Post reports that the Thai regulator (NBTC) will propose ten remedial measures to approve the Total Access Communication (DTAC TB)/True Corp Pcl (TRUE TB) merger.
The NBTC board is not expected to issue a final decision as it waits for an interpretation by the Council of State if it can approve or reject the merger.
The current share price ratio is 9.511x vs the swap ratio of 10.221x. At last close, DTAC and True’s gross spread to the VTO price is 9.2% and 10.7%, respectively.

Major Stock Swap Between Hyundai Motor Group and KT Corp

By Douglas Kim

On 7 September, Hyundai Motor (005380 KS) announced a major stock swap with KT Corp (030200 KS).
KT will exchange about 750 billion won (7.7%) of KT’s treasury stock for 445.6 billion won (1.04%) of Hyundai Motor shares and 300.3 billion won (1.46%) of Hyundai Mobis shares.
This stock swap is likely to have a bigger positive impact on KT versus Hyundai Motor and Hyundai Mobis.

Hong Kong CEO & Director Dealings – 1st Sept 2022: A8 New Media, China Fordoo

The data in this insight is collated from the “shareholding disclosure” link on the HKEx website
Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. However, such disclosures are by no means an absolute.
These insights may also flag those companies where shares have been pledged, both recently and ongoing. Stocks mentioned include A8 New Media (800 HK) and China Fordoo Holdings (2399 HK).

Intention to Float Porsche AG: A Good Deal for Porsche Automobile Holding SE

By Jesus Rodriguez Aguilar

Volkswagen aims for an IPO of Porsche AG (operating company). 25% of preferreds will be placed and 25% of ords sold to Porsche Automobile Holding SE (combined, 25% equity capital).
Thought a holding chain, the Pïech and Porsche families will directly control 25% of the votes of Porsche AG and 39.975% indirectly (total of 64.975%), with just a 24.275% economic interest.
Porsche Automobile Holding SE will cover c.30% of the cost of its stake through the extraordinary dividend that Volkswagen will pay. It also gets the ords at a friendly price.

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Sep 07

Daily Brief Event-Driven: Nikkei 225 March 2023 Review Quiddity Leaderboard and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Nikkei 225 March 2023 Review Quiddity Leaderboard
Selected European Holdcos and DLCs: August ‘22 Report
Tencent Increases Its Stake in Ubisoft
Explaining the Unusual Flow Situation of Osstem Implant
DAX, MDAX, SDAX, TecDAX Sep 2022 Rebal: Large Impacts Only for Hella & Stabilius

Nikkei 225 March 2023 Review Quiddity Leaderboard

By Shifara Samsudeen, ACMA, CGMA

The Sep 2022 Nikkei 225 Annual Review has been announced. This was discussed in Nikkei 225 Review Results: Nidec, SMC, Hoya IN.
That means we can make early predictions for the March 2023 rebalance to be announced in six months. One way turnover would be about 1.4%.
The top three adds are Oriental Land, Renesas, and JAL. The top 3 sells would be Toyobo, Toho Zinc, and Nippon Sheet Glass. There are some dark horses here too.

Selected European Holdcos and DLCs: August ‘22 Report

By Jesus Rodriguez Aguilar

Discounts to NAV of covered holdcos have mainly widened or stayed at the same level during August/beginning of September, in line with the loses in the main indexes.
Discounts to NAV (5 September): Alba, 46.1%; GBL, 34.1%; Heineken Holdings 21.3%; Industrivärden C, 10.1%; Investor B, 18.9%; Porsche Automobile Holding 29.4%. The spread of Rio Tinto DLC tightened to 14.5%.
Spreads tend to widen in bear markets but short-term recoveries provide opportunities on tightening discounts. Recommended trades are: Industrivärden C vs. listed assets, Porsche, Rio Tinto (DLC).

Tencent Increases Its Stake in Ubisoft

It was reported in August that Tencent was looking to raise its stake in Ubisoft and had reached out to Ubisoft’s founding family Guillemot who currently owns 14.0% of Ubisoft.
Tencent has acquired a 49.9% economic stake in Guillemot Brothers for EUR300m and as part of the deal, will be allowed to up its current stake in Ubisoft.
Ubisoft announced on Tuesday that its board of directors have authorised Tencent to increase its direct stake in Ubisoft from 4.5% to 9.99%.

Explaining the Unusual Flow Situation of Osstem Implant

From August 26 to September 2, the net buying of investors classified as “Other Corporation” was substantial at 500K shares or 3.5% of SO, which amounted to about ₩60B.
It seems almost sure that the KCGI has made a move. As a result, the possibility that the Hanjin Kal event will be repeated is also relatively high.
The first inflection point would be when the KCGI passes the 5% stake and makes a regulatory filing. We will see a pretty intense momentum trading on proxy battle expectations.

DAX, MDAX, SDAX, TecDAX Sep 2022 Rebal: Large Impacts Only for Hella & Stabilius

The September 2022 index changes for DAX, MDAX, SDAX, and TecDAX were announced late last night.
There is one change for the DAX Index, four changes for the MDAX Index, seven changes for the SDAX Index, and two changes for the TecDAX Index.
In this insight, we take a closer look at our expectations for index flows and potential trading ideas.

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Sep 06

Daily Brief Event-Driven: Nikkei 225 Index Rebalance: Mostly on Expected Lines and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Nikkei 225 Index Rebalance: Mostly on Expected Lines
Nikkei 225 Review Results: Nidec, SMC, Hoya IN
Giordano’s Acceptances Just Short of the 50% Voting Threshold; Offer Period Extended
KOSPI Size Index Migration: Official Results & Trading Approach Towards Implementation
Giordano (709 HK): Cheng’s Have 44.98%. Offer Extended

Nikkei 225 Index Rebalance: Mostly on Expected Lines

The Nikkei 225 (NKY INDEX) September rebalance will be done in three parts due to the delisting of Shizuoka Bank (8355 JP) and the relisting of Shizuoka Financial Group (5831).
Nidec Corp (6594 JP), SMC Corp (6273 JP) and Hoya Corp (7741 JP) replace Unitika Ltd (3103 JP), Oki Electric Industry (6703 JP) and Maruha Nichiro (1333 JP).
Passive trackers need to buy over 10 days ADV on the adds and there is a large impact of the funding trade given the add/delete size difference.

Nikkei 225 Review Results: Nidec, SMC, Hoya IN

The Nikkei Index Team announced the Nikkei 225 Annual Review today, days earlier than I expected. Nidec Corp (6594 JP), SMC Corp (6273 JP), Hoya Corp (7741 JP) are IN.
Unitika Ltd (3103 JP), Maruha Nichiro (1333 JP), and Oki Electric Industry (6703 JP) are OUT. They did not go for my subjective choices to improve sector balance. Next time.
The inclusion/exclusion events are staggered over 3 days out of four because of the deletion and re-inclusion of Shizuoka Bank (8355 JP) due to its formation of a holding company.

Giordano’s Acceptances Just Short of the 50% Voting Threshold; Offer Period Extended

The offeror and acceptances reached 44.98%, just short of the 50% minimum acceptance condition. The closing date has been extended to 13 September.
If the offer is declared unconditional on or before 8 September, Giordano International (709 HK) shareholders who accept the offer will get HK$1.88 but not the dividend of HK$0.085.
The offeror likely remains confident that it will hit the 50% threshold. At the last close, the gross and annualised spread for 17 Sep payment is 1.1% and 37.2%, respectively.

KOSPI Size Index Migration: Official Results & Trading Approach Towards Implementation

The results are pretty much in line with the predictions, except for Hanwha Aerospace which made it to LARGE instead of Hyundai Marine & Fire Insurance.
Assuming that ten names, including Hyundai Marine, were traded in a LONG/SHORT basket with equal weight, the yield from August 17 to the last close would have been 4.6%.
I would still approach with an equal-weighted basket trading until this Thursday. This flow trading usually loses its effect rapidly after rebalancing. So, I wouldn’t carry it beyond this Thursday.

Giordano (709 HK): Cheng’s Have 44.98%. Offer Extended

Late last night, Giordano International (709 HK) announced the Offeror – the Cheng Family – had 44.98% in the bag after 20.41% of shares out had been tendered.
The Offer has been extended for one week, until the 13 September.
Whether investors receive the Offer consideration AND the interim divided is still up for debate.

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Sep 05

Daily Brief Event-Driven: SK Discovery Launches Opportunistic Partial Tender on SK Chemicals To Buy SK Bio CHEAP and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

SK Discovery Launches Opportunistic Partial Tender on SK Chemicals To Buy SK Bio CHEAP
SK Chemicals Cash Offer: Complete Details
Merger Arb Mondays (05 Sep) – Link Admin, Ramsay, Genex, ResApp, Infomedia, DTAC/True, Giordano
New Regulations on Split-Off Listing in Korea: Complete Details & Trading Implications
S&P ASX Sep 22 Rebal: Decent Impacts but Avoid Short Buildup
HAL Holding/Royal Boskalis Westminster: Sweetened Offer

SK Discovery Launches Opportunistic Partial Tender on SK Chemicals To Buy SK Bio CHEAP

On Friday morning, Sk Discovery (006120 KS), current owner/controller of 36.56% of Sk Chemicals Co Ltd/New (285130 KS) announced an opportunistic Partial Offer to buy 5.22% more at KRW 108,800/share.
The stated purpose in the Tender Offer Announcement is “Stability of Management Rights.” This will get SK Discovery to 41.77%, permitting consolidation of SK Chemicals.
The real reason?SK Chemicals shares are trading at less than one-third the value of the SK Bioscience (302440 KS) shares they hold (with net cash and others free).

SK Chemicals Cash Offer: Complete Details

This is a cash offer. So, there is no stock swap arbitrage here. To participate in this tender, we must buy SK Chemicals shares by the 19th.
We have proration risk. Discovery will buy on a pro-rata basis if exceeding the target volume. So, we could be at a loss.
This is an over-the-counter transaction. So both STT and CGT apply. The STT rate is 0.43% of the tendered amount and we have a 22% CGT rate for the profit.

Merger Arb Mondays (05 Sep) – Link Admin, Ramsay, Genex, ResApp, Infomedia, DTAC/True, Giordano

We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand and Chinese ADRs.
Highest spreads – 21Vianet Group (VNET US), Alliance Aviation Services (AQZ AU), Ramsay Health Care (RHC AU), Infomedia Ltd (IFM AU), Link Administration (LNK AU), True Corp Pcl (TRUE TB).
Lowest spreads – MyDeal.com.au Ltd (MYD AU), MACA Ltd (MLD AU), Nearmap Ltd (NEA AU), Dongzheng Automotive Finance (2718 HK), Link Net (LINK IJ), Tassal (TGR AU), Frasers Hospitality Trust.

New Regulations on Split-Off Listing in Korea: Complete Details & Trading Implications

The Korea FSC finalized the additional investor protection measures: 1. stricter disclosure rules, 2. tighter listing requirements, and 3. mandatory appraisal rights.
The retroactive application period is five years. Companies that have been split off five years ago from the effective date are also subject to these new rules.
We can play LONG/SHORT aimed at staggered spreads, considering that the pricing period is 2M VWAP and that a downward price revision intensifies towards the announcement with mandatory appraisal rights.

S&P ASX Sep 22 Rebal: Decent Impacts but Avoid Short Buildup

The index changes for the S&P ASX Index family for the September 2022 Rebalance were announced after the close on Friday.
There will be one change for the ASX 100 index and 8 changes for the ASX 200 Index. The ASX 300 Index will have 16 ADDs and 12 DELs.
In this insight, we take a closer look at our expectations for index flows and potential trading ideas.

HAL Holding/Royal Boskalis Westminster: Sweetened Offer

By Jesus Rodriguez Aguilar

HAL increased the offer price by 3.1%, to €33.00, as final price, which represent a premium of c. 32%. A surprising move, as guidance provided no reason for doing so.
HAL and Stichting Hyacinth own c.55.6% (27 July), vs. 46.2% upon offer announcement. Boskalis and HAL agreed that if HAL holds at least 95%, HAL will initiate a squeeze-out and delisting.
The offer is now recommended by Boskalis’ Boards and the acceptance period has been extended until 6 September (inclusive). Tender.

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Sep 04

Daily Brief Event-Driven: Index Rebalance & ETF Flow Recap: S&P/ASX and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Index Rebalance & ETF Flow Recap: S&P/ASX, CH50/A50, TW50/Div+, NIFTY50/100, STI, EPRA, Sensex
KOSPI 200 December Rebalancing Safe Play
Yamada Denki (9831) Buyback Progress Strong But Big Impact To Come
Weekly Deals Digest (04 Sep) – Giordano, BYD, Link Net, MACA, Nitro, Nearmap, Leapmotor, Onewo
Nikkei 225 Sep 2022 Review Update
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Nitro Software, MACA, Giordano, Link Net
Last Week in Event SPACE: Kyocera, Hang Lung Group, CSRC/PCAOB Audit Terms, MACA, Nitro Software
FTSE TWSE Sep 22 Rebal: 100% Hit Rate, Elan Deletion Confirmed, Significant Flows from Div+ Capping

Index Rebalance & ETF Flow Recap: S&P/ASX, CH50/A50, TW50/Div+, NIFTY50/100, STI, EPRA, Sensex

There were a bunch of rebalance announcements last week from FTSE and Nifty, and implementation of changes to the MSCI, JPXNK400 and Hang Seng indexes.
The changes to the Nikkei 225 (NKY INDEX) should be announced early in the coming week and the changes to the SSE STAR50 (STAR50 INDEX) will be implemented on Friday.
There were large inflows to China and Hong Kong focused ETFs during the week.

KOSPI 200 December Rebalancing Safe Play

Although not many, there are strong candidates for a safe play aimed at constituent change. Inclusion: Lotte Confectionery & Exclusion: Samyang Holdings
Lotte Confectionery’s average daily market cap must fall by more than 30% to be pushed out of the borderline. Samyang Holdings’s market cap gap to the second-lowest one is 17%.
The trading volume of these two is so small that a significant passive impact (relative to DTV) will likely occur. We should consider a little more aggressive approach, timing-wise.

Yamada Denki (9831) Buyback Progress Strong But Big Impact To Come

In early May 2022, Yamada Denki (9831 JP) launched a GINORMOUS buyback program. I wrote about it suggesting the company meant business. The stock popped outright and vs Peers.
Then it fell back, and has only recently started moving back up. Surprising given buyback dynamics but it may have been overhang. If so, that overhang should be gone now.
And the stock is cheap, a chunk of the register is sticky, so this could get squeezier now.

Weekly Deals Digest (04 Sep) – Giordano, BYD, Link Net, MACA, Nitro, Nearmap, Leapmotor, Onewo

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments – Leapmotor (2007699D HK) and Onewo Space-Tech (ONEWO HK) are pre-marketing a US$1.5 billion and US$2.0 billion HKEx IPO, respectively.
Event-Driven developments – BYD (1211 HK), Giordano International (709 HK), MACA Ltd (MLD AU), Nitro Software Ltd (NTO AU), Link Net (LINK IJ).

Nikkei 225 Sep 2022 Review Update

The Nikkei 225 rebalance will likely be announced this week. I continue to be slightly off-kilter, expecting Nidec, SMC, and Oriental Land to replace Unitika, Oki Electric, and Toho Zinc.
Others would expect Hoya to replace Maruha Nichiro instead of Oriental Land replacing Toho Zinc, but I think it Nikkei Sector balance may matter. It could go either way.
Tactically speaking, cumulative volumes and Real World Float tell you how you might trade this.

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Nitro Software, MACA, Giordano, Link Net

There are 49 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
One new deal was discussed this week: Potentia’s rejected proposal for Nitro Software Ltd (NTO AU).
Key updates took place for MACA Ltd (MLD AU), Giordano International (709 HK), and Link Net (LINK IJ).

Last Week in Event SPACE: Kyocera, Hang Lung Group, CSRC/PCAOB Audit Terms, MACA, Nitro Software

Kyocera (6971 JP) is not blowing out the lights versus peers, but it’s relatively inexpensive to its history and peers. If Kazuo Inamori’s shares are sold, Kyocera can buy them.
Hang Lung (10 HK) currently trades at a 62% discount to NAV, a level last seen around the Covid lows in May 2020.
Washington and Beijing reach an agreement allowing US regulators access to audits of Chinese companies listed on American exchanges. However, US regulators remain cautious about the success of the deal.

FTSE TWSE Sep 22 Rebal: 100% Hit Rate, Elan Deletion Confirmed, Significant Flows from Div+ Capping

The index changes for the FTSE TWSE Taiwan 50 and Taiwan Mid-Cap 100 indices for the September 2022 Rebalance were announced after the close on Friday.
There will be one change for the Taiwan 50 Index and five changes for the Taiwan Mid-Cap 100 Index. All changes are exactly in line with our expectations.
In this insight, we take a closer look at our index flow expectations for this Rebalance event and for the Taiwan Dividend + Index Capping Event.

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Sep 03

Daily Brief Event-Driven: FTSE TWSE Taiwan 50/ Div+ Index Rebalance: Sinopac Holdings and Elan Micro To Watch For and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

FTSE TWSE Taiwan 50/ Div+ Index Rebalance: Sinopac Holdings and Elan Micro To Watch For
S&P/ASX Index Rebalance (Sep 2022): Adds, Deletes, Surprises & Pre-Positioning
EURO STOXX 50 Sep 22 Rebal: Massive Flows for Nordea Bank, Nokia, Kone, & Philips
STOXX Europe 600 Sep 2022 Rebal: ADDs Could Outperform DELs for the Next Few Weeks
Shanghai/Shenzhen Northbound Connect: Weekly Moves (2 September 2022)
Shanghai/Shenzhen Southbound Connect: Weekly Moves (2 September 2022)

FTSE TWSE Taiwan 50/ Div+ Index Rebalance: Sinopac Holdings and Elan Micro To Watch For

As expected, SinoPac Holdings (2890 TT) will replace Powerchip Semiconductor Manufacturing Corp (6770 TT) in the FTSE TWSE Taiwan 50 Index at the close on 16 September.
Elan Microelectronics (2458 TT) will be deleted from the Mid-Cap 100 Index and will consequently be deleted from the Dividend+ Index. The Div+ selling will be spread over 16-22 September.
Passives need to buy over 6 days ADV on SinoPac Holdings and sell over 12 days ADV on Elan Microelectronics, while there will be net inflows on Powerchip Semiconductor Manufacturing Corp.

S&P/ASX Index Rebalance (Sep 2022): Adds, Deletes, Surprises & Pre-Positioning

There is one change for the S&P/ASX 100 Index, eight changes to the S&P/ASX 200 (AS51 INDEX), while there are 16 adds and 12 deletes for the S&P/ASX 300 Index.
Passive trackers need to buy/sell a lot of stock for the ASX100 and ASX200 names. There appears to be large pre-positioning on the deletes.
Link Administration (LNK AU)‘s privatisation may require an ad hoc inclusion prior to the implementation of the September rebalance – ACCC approval is key.

EURO STOXX 50 Sep 22 Rebal: Massive Flows for Nordea Bank, Nokia, Kone, & Philips

The annual index changes for the EURO STOXX 50 Index were announced yesterday.
There will be two ADDs and two DELs. Collectively, the ADDs could see index inflows of ~US$2.15bn while the DELs could experience index outflows of ~US$1.05bn.
In this insight, we take a closer look at the index flow expectations, historical performance of EURO STOXX 50 Rebal events, and recent performance of the current index change names.

STOXX Europe 600 Sep 2022 Rebal: ADDs Could Outperform DELs for the Next Few Weeks

The September 2022 index changes for the STOXX Benchmark Indices were announced yesterday.
There will be 16 ADDs/DELs for the STOXX Europe 600 Index and there will be 5 ADDs and 6 DELs for the EURO STOXX Index.
In this insight, we take a closer look at the index flow expectations and the historical performance of Rebal events.

Shanghai/Shenzhen Northbound Connect: Weekly Moves (2 September 2022)

Inside is a recap of movements in the last week relating to the Hong Kong Stock Exchange -Shanghai and Shenzhen Northbound Connect facilities, broken down by company and industry
Overall, net inflow over the past week was ~US$0.7bn, split between Shanghai (US$0.3bn) and Shenzhen (US$0.4bn).
The largest inflows were into Gree Electric Appliances (000651 CH) and CATL (300750 CH). The largest outflows were in Industrial Bank (601166 CH) and China Merchants Bank (600036 CH).

Shanghai/Shenzhen Southbound Connect: Weekly Moves (2 September 2022)

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, the net outflow over the past week was ~US$0.1bn, split (-US$0.4bn) for Shanghai and (+US$0.3bn) for Shenzhen.
The largest inflows were into CNOOC Ltd (883 HK) and Yankuang Energy Group (1171 HK). The largest outflows were in Meituan (3690 HK) and Kuaishou Technology (1024 HK).

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Sep 02

Daily Brief Event-Driven: Sep22 FTSE EPRA Nareit Index Rebalance – Big Impact on Sekisui House (1928 JP) and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Sep22 FTSE EPRA Nareit Index Rebalance – Big Impact on Sekisui House (1928 JP)
Hang Lung Group Chips Away At Holding In Hang Lung Props
STI Index Rebalance: Emperador IN, ComfortDelGro OUT
Kadokawa – Investments From Sony and Tencent
NIFTY NEXT50 Index Rebalance: Significant Impact for an Overlooked Index
NIFTY50 Index Rebalance: Adani Enterprises Replaces Shree Cement
FTSE UK Sep 2022 Rebal: Warehouse REIT (WHR) Sees HUGE Impact
NIFTY Sep 2022 Rebal: Adani Enterprises and Adani Total Gas Are Top Positives

Sep22 FTSE EPRA Nareit Index Rebalance – Big Impact on Sekisui House (1928 JP)

Yesterday FTSE Russell announced two Asian additions to its FTSE EPRA Nareit Global Developed Index – Sekisui House (1928 JP) and Healthcare & Medical Investment Corporation (3455 JP).
Sekisui House is larger cap, and will see big dollars added. H&M IC is much smaller and will see less, but has had a huge run-up, outright and relative.
Trading impact will be significant on both tickers in terms of days of ADV.

Hang Lung Group Chips Away At Holding In Hang Lung Props

Hang Lung (10 HK) recently announced it had acquired 1.3% in Hang Lung Properties (101 HK) over a one-year period, increasing its holding to 59.5%.
HLG currently trades at a 62% discount to NAV, a level last seen around the Covid lows in May 2020.
HLG is the most basic of Holdco structures – there is almost a 100% overlap in the stub ops with HLP’s property investments.

STI Index Rebalance: Emperador IN, ComfortDelGro OUT

Emperador (EMI SP) will replace Comfortdelgro Corp (CD SP) in the FTSE Straits Times Index (STI) (STI INDEX) at the close of trading on 16 September.
Though the changes were expected, there is over 4 days of ADV to trade on both stocks and we do not feel there are a lot of pre-positions built up.
There are some risks in the stocks, and we would look to close out positions prior to the implementation of the changes.

Kadokawa – Investments From Sony and Tencent

By Mio Kato

Kadokawa announced yesterday that subsidiary From Software would conduct a third-party allocation of shares to Sony and Tencent.
The allotment values From Software at about ¥120bn with Tencent acquiring 16.25% and Sony acquiring 14.09% of the company.
This creates opportunities for both Sony and Tencent and likely puts Kadokawa on track to eventually be acquired though timing may be somewhat later than we had anticipated.

NIFTY NEXT50 Index Rebalance: Significant Impact for an Overlooked Index

Adani Total Gas (ATGL IN), Bharat Electronics (BHE IN), Hindustan Aeronautics (HNAL IN), IRCTC (IRCTC IN), Mphasis (MPHL IN), Samvardhana Motherson (MSS IN) and Shree Cement (SRCM IN) are adds.
Adani Enterprises (ADE IN), Jubilant Foodworks (JUBI IN), Lupin (LPC IN), Mindtree (MTCL IN), Punjab National Bank (PNB), Steel Authority of India (SAIL) and Zydus Lifesciences (ZYDUSLIF IN) are deletes.
There is significant impact on a lot of the stocks in terms of days of delivery volume to trade. Given the index is overlooked, there could be significant price movements.

NIFTY50 Index Rebalance: Adani Enterprises Replaces Shree Cement

Adani Enterprises (ADE IN) will replace Shree Cement (SRCM IN) in the NIFTY Index (NIFTY INDEX) at the close of trading on 29 September.
We had forecast the change in April and Adani Enterprises (ADE IN) is up over 60% since then while Shree Cement (SRCM IN) is down a bit.
Passive NIFTY Index (NIFTY INDEX) trackers will need to buy over 7% of the real float on Adani Enterprises (ADE IN). The stock could continue to move higher.

FTSE UK Sep 2022 Rebal: Warehouse REIT (WHR) Sees HUGE Impact

The index changes for the FTSE UK Indices for the September 2022 Rebalance were announced yesterday. There will be 3 changes for FTSE 100 and 8 changes for FTSE 250.
These index changes are mostly in line with our expectations in FTSE UK Quiddity Leaderboard Sep 2022: Avast, Meggitt, Brewin, and a Busy Rebalance Month.
However, there a couple of surprises. In this insight, we take a closer look at our expectations for index flows and potential trading ideas

NIFTY Sep 2022 Rebal: Adani Enterprises and Adani Total Gas Are Top Positives