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

Goodbaby China IPO - International Vs China, There Is Only One Brand Owner

Goodbaby – Higher Margins and Business Model Transition Offset Lower Revenues – 100%+ Upside - BUY

Quiddity Advisors

Event-Driven

Goodbaby International Hldg / Event-Driven

Before the open yesterday, <a href="https://www.smartkarma.com/entities/9467" target="_blank" data-smartkarma-citation="entities:9467:1">Goodbaby International Hldg Ltd (1086 HK)</a> <a href="http://www.hkexnews.hk/listedco/listconews/SEHK/2017/0725/LTN20170725007.pdf" target="_blank">announced</a> the potential $2.8bn acquisition (cash + new shares) of Goodbaby (China) Retail &amp; Service Company Limited  ("GRSH"), a variant of <a href="https://www.smartkarma.com/entities/22620" target="_blank" data-smartkarma-citation="entities:22620:1">Goodbaby China Holdings Ltd (6186 HK)</a>, an IPO which did not proceed in February 2016. Our <a href="https://www.smartkarma.com/profiles/4" target="_blank" data-smartkarma-citation="accounts:4">Sumeet Singh</a><a href="https://www.smartkarma.com/insights/goodbaby-china-ipo-international-vs-china-there-is-only-one-brand-owner" target="_blank">covered</a> this IPO and assigned a negative score.GRSH is majority owned (~74%) by Zhenghuan Song, if including his spouse's and nephew's stakes. Song, in turn, is the major shareholder (23.13% indirect stake as per the announcement or 25.9% according to the <a href="http://sdinotice.hkex.com.hk/filing/di/NSAllSSList.aspx?sa2=as&amp;sid=50000579&amp;corpn=Goodbaby+International+Holdings+Ltd.&amp;sd=30/08/2016&amp;ed=28/06/2017&amp;sa1=cl&amp;scsd=26%2f07%2f2016&amp;sced=26%2f07%2f2017&amp;sc=1086&amp;src=MAIN&amp;lang=EN&amp;" target="_blank">HKEx</a>) in Goodbaby.Goodbaby is paying around 25x/~15x trailing/forward PER for GRSH vs its own 17x/14.5x PER. However, that forward multiple extrapolates GRSH's 4M17 figures, which suggests 70% bottom line growth in 2017.The shares to be issued as part consideration are priced at $3.49/share, a 6.4% premium to the undisturbed price. Goodbaby's shares increased 10% on the news.The acquisition requires shareholder &amp; regulatory approval, and a whitewash waiver from the SFC.Goodbaby trades ~US$1mn/day. More below the fold for subscribers.

Before the open yesterday, Goodbaby International Hldg Ltd (1086 HK) announced the potential $2.8bn acquisition (cash + new shares) of Goodbaby (China) Retail &amp; Service Company Limited  ("GRSH"), a variant of Goodbaby China Holdings Ltd (6186 HK), an IPO which did not proceed in February 2016. Our Sumeet Singhcovered this IPO and assigned a negative score.GRSH is majority owned (~74%) by Zhenghuan Song, if including his spouse's and nephew's stakes. Song, in turn, is the major shareholder (23.13% indirect stake as per the announcement or 25.9% according to the HKEx) in Goodbaby.Goodbaby is paying around 25x/~15x trailing/forward PER for GRSH vs its own 17x/14.5x PER. However, that forward multiple extrapolates GRSH's 4M17 figures, which suggests 70% bottom line growth in 2017.The shares to be issued as part consideration are priced at $3.49/share, a 6.4% premium to the undisturbed price. Goodbaby's shares increased 10% on the news.The acquisition requires shareholder &amp; regulatory approval, and a whitewash waiver from the SFC.Goodbaby trades ~US$1mn/day. More below the fold for subscribers.

Goodbaby International Hldg

Goodbaby - Don't Get Carried Away