Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

HK Type 4 license through Ballingal Investment Advisors Ltd. ("BIA" or "BIAL")

BACKGROUND
I have 20+yrs experience in Asia doing alternative strategies (i.e. non-delta1 non long-only) in fixed income, equity derivatives, and activist/catalyst/event-driven and long-short equity strategies with most of that time spent managing money. 

4 years in fixed income macro, 8 years running internal hedge fund and 4yrs investment banking at Citi in Japan, 3 years running an Asia multi-strat portfolio at a hedge fund, 4+yrs as an independent special situations analyst.

Pan-Asia Catalysts/Events

Coca Cola Bottlers Japan - Big Tender Offer Buyback & Cross-Holding Unwind

Coca-Cola Bottlers Japan Buying Back Big. Again. Expect Even More Later

Event-Driven

In late April this year, just before Golden Week and two weeks before earnings were announced, <a href="https://www.smartkarma.com/entities/4270" target="_blank" data-smartkarma-citation="entities:4270:1">Coca Cola East Japan Co Ltd (2580 JP)</a> (hereafter "CCEJ")and <a href="https://www.smartkarma.com/entities/20051" target="_blank" data-smartkarma-citation="entities:20051:1">Coca Cola West Co Ltd (2579 JP)</a> (hereafter "CCW") announced they had signed an MOU regarding a business integration between the two companies. Longtime Japan-watchers had expected this to come at some point after multiple integrations on both sides had left Japan with the two major bottlers plus Hokkaido as the major TCCC (The Coca-Cola Company) distributors hawking KO product in Japan. The Nihon Keizai Shinbun carried an article on Sep 27 suggesting the two companies would indeed merge and this was confirmed Friday at the close. The details are as expected. The CCEJ/CCW Merger Ratio came in at 0.75x, which happens to be the exact average ratio of the 1mo, 3mo, and 1-year share price averages as of Friday's close. The average of these three averages on April 25 - one day before the MOU announcement - was 0.737x.Since the MOU was announced on the 26th of April, the ratio has risen from 0.672x to 0.78x after a brief stop above 0.80x earlier in September though the ratio spent most of the May to July timeframe around or just below 0.7x. Those who bought during that period may have done OK for themselves but it was not a huge surprise one way or the other. The ratio is roughly in line with the two companies' independent financial advisors' "fairness evaluations", and not too far off historical ratios. Based on current year forecasts, the ratio is slightly favorable to CCW. The companies also each have roughly 40% of shares held by cross holders and 15% by individuals (as of the end of last fiscal year). This does not appear to have significant obstacles in the path to a clean result. There is one obvious trade on the back of this. But it's small.More below the fold for subscribers.

In late April this year, just before Golden Week and two weeks before earnings were announced, Coca Cola East Japan Co Ltd (2580 JP) (hereafter "CCEJ")and Coca Cola West Co Ltd (2579 JP) (hereafter "CCW") announced they had signed an MOU regarding a business integration between the two companies. Longtime Japan-watchers had expected this to come at some point after multiple integrations on both sides had left Japan with the two major bottlers plus Hokkaido as the major TCCC (The Coca-Cola Company) distributors hawking KO product in Japan. The Nihon Keizai Shinbun carried an article on Sep 27 suggesting the two companies would indeed merge and this was confirmed Friday at the close. The details are as expected. The CCEJ/CCW Merger Ratio came in at 0.75x, which happens to be the exact average ratio of the 1mo, 3mo, and 1-year share price averages as of Friday's close. The average of these three averages on April 25 - one day before the MOU announcement - was 0.737x.Since the MOU was announced on the 26th of April, the ratio has risen from 0.672x to 0.78x after a brief stop above 0.80x earlier in September though the ratio spent most of the May to July timeframe around or just below 0.7x. Those who bought during that period may have done OK for themselves but it was not a huge surprise one way or the other. The ratio is roughly in line with the two companies' independent financial advisors' "fairness evaluations", and not too far off historical ratios. Based on current year forecasts, the ratio is slightly favorable to CCW. The companies also each have roughly 40% of shares held by cross holders and 15% by individuals (as of the end of last fiscal year). This does not appear to have significant obstacles in the path to a clean result. There is one obvious trade on the back of this. But it's small.More below the fold for subscribers. 

Coke Goes Better With Coke:  Coca-Cola West-East Japan Merger