Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

HK Type 4 license through Ballingal Investment Advisors Ltd. 

I'm a highly experienced sell-side analyst with in excess of 22 years of covering Asia Pacific equities, the past 19 years immersed in event strategies encompassing M&A risk arbitrage, directional long/short, stub trades and restructuring.  

My background also includes accountancy (liquidation/bankruptcy/receivership) earlier in my career and as a chief financial officer of a global commodity company based in the US and Mexico.

Pan-Asia Catalysts/Events

Cardinal Resources: Shandong's Indicative Bump

Cardinal Resources (CDV AU). Exit Nord Gold, Enter Dongshan.

Cardinal Resource (CDV AU): Shandong Reloads, But Not A Knockout Offer

Cardinal Resources (CDV AU): Nordgold's Knockout Offer

Cardinal Resources (CDV AU): Shandong Trumps Nordgold’s Knockout Offer

Quiddity Advisors

Event-Driven

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<p>In its second supplementary bidder's statement on the <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02295721-6A1001904?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">19 October</a>, <a href="https://www.smartkarma.com/entities/shandong-gold-mining-co-ltd-61153493-5437-47ee-a8d3-aec41fb7f1da" target="_blank" data-smartkarma-citation="entities:27455:1" rel="noopener">Shandong Gold Mining Co., Ltd. (1787 HK)</a> said its $1.00/share off-market unconditional offer was "<em>best and final in the absence of a higher competing offer</em>". The practical effect of this statement is that unless there is a higher competing Offer than Shandong's offer, Shandong cannot increase its offer price. </p>
<p>Shandong's offer is unanimously supported by Cardinal's board. As per its most recent regulatory filing, Shandong held <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02292439-6A1000653?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">11.86%</a> in Cardinal.</p>
<p>At the time of the "best and final" statement, Nordgold's Offer was $0.90/share, an Offer that was expected to close on the 3 November (after its <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02294128-6A1001310?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">fourth extension</a>), unless extended. Nordgold held <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02276760-6A994412?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">28.39%</a> as per its recent regulatory filing on the 2 September. Cardinal viewed Nordgold's Offer as being inferior to Shandong's. Furthermore, Cardinal considered the lack of price increase from Nordgold since Shandong's revised Offer could result in unwarranted delays in the development the Namdini project, and will "<em>continue to frustrate the decision-making process for Cardinal's shareholders</em>". </p>
<h3>New News</h3>
<p>Yesterday, Nordgold increased its Offer rice to <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02296571-6A1002232?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">A$1.00/share</a>. </p>
<p>But then it gets messy - does Nordgold's improved Offer constitute a higher competing offer? Shandong says <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02297278-6A1002505?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">yes</a>. Nordgold says no. </p>
<p>The fact Nordgold matched Shandong's offer after six weeks of crunching numbers suggests we are approaching full value for Cardinal.</p>
<p>In the meanwhile, Cardinal continues to recommend shareholders accept Shandong's Offer.</p>
<p>As always, more below the fold.</p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/166/636/original/image_18779035421603327929176.png?1603327931" class="editor-image img-responsive" data-smartkarma-image-id="166636"></figure>
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<p><em>Past insights on Cardinal:</em></p>
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<h3>Date</h3>
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<td style="width: 484.782px;">
<h3>Insight</h3>
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<td style="width: 218.75px;">22-Jun-20</td>
<td style="width: 484.782px;"><a href="https://skr.ma/sVxVB" target="_blank" rel="noopener">Shandong's Competing Offer For Cardinal</a></td>
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<td style="width: 218.75px;">15-Jul-20</td>
<td style="width: 484.782px;"><a href="https://skr.ma/E1Wgv" target="_blank" rel="noopener">Cardinal Resource (CDV AU): Nordgold Reloads</a></td>
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<td style="width: 218.75px;">23-Jul-20</td>
<td style="width: 484.782px;"><a href="https://skr.ma/tVkqj" target="_blank" rel="noopener">Cardinal Resource (CDV AU): Shandong Reloads, But Not A Knockout Offer</a></td>
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<td style="width: 218.75px;">2-Sep-20</td>
<td style="width: 484.782px;"><a href="https://skr.ma/eGXfx" target="_blank" rel="noopener">Cardinal Resources (CDV AU): Nordgold's Knockout Offer. Read more:</a></td>
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<td style="width: 218.75px;">7-Sep-20</td>
<td style="width: 484.782px;"><a href="https://skr.ma/4gYtj" target="_blank" rel="noopener">Cardinal Resources (CDV AU): Shandong Trumps Nordgold’s Knockout Offer</a></td>
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In its second supplementary bidder's statement on the 19 October, Shandong Gold Mining Co., Ltd. (1787 HK) said its $1.00/share off-market unconditional offer was "best and final in the absence of a higher competing offer". The practical effect of this statement is that unless there is a higher competing Offer than Shandong's offer, Shandong cannot increase its offer price. 
Shandong's offer is unanimously supported by Cardinal's board. As per its most recent regulatory filing, Shandong held 11.86% in Cardinal.
At the time of the "best and final" statement, Nordgold's Offer was $0.90/share, an Offer that was expected to close on the 3 November (after its fourth extension), unless extended. Nordgold held 28.39% as per its recent regulatory filing on the 2 September. Cardinal viewed Nordgold's Offer as being inferior to Shandong's. Furthermore, Cardinal considered the lack of price increase from Nordgold since Shandong's revised Offer could result in unwarranted delays in the development the Namdini project, and will "continue to frustrate the decision-making process for Cardinal's shareholders". 
New News
Yesterday, Nordgold increased its Offer rice to A$1.00/share. 
But then it gets messy - does Nordgold's improved Offer constitute a higher competing offer? Shandong says yes. Nordgold says no. 
The fact Nordgold matched Shandong's offer after six weeks of crunching numbers suggests we are approaching full value for Cardinal.
In the meanwhile, Cardinal continues to recommend shareholders accept Shandong's Offer.
As always, more below the fold.




Past insights on Cardinal:








Date


Insight



22-Jun-20
Shandong's Competing Offer For Cardinal


15-Jul-20
Cardinal Resource (CDV AU): Nordgold Reloads


23-Jul-20
Cardinal Resource (CDV AU): Shandong Reloads, But Not A Knockout Offer


2-Sep-20
Cardinal Resources (CDV AU): Nordgold's Knockout Offer. Read more:


7-Sep-20
Cardinal Resources (CDV AU): Shandong Trumps Nordgold’s Knockout Offer







Cardinal Resources: Nordgold's "Competing Offer"