IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

Arun has over 15 years’ experience covering the Technology sector. During this time, he has worked with technology start-ups and as an equity analyst in investment banks and independent research firms. He was formerly a Technology Analyst for Canaccord Genuity, Altium Securities, Espirito Santo Investment Bank, Noble Group and Clear Capital. He has a dual Master’s degree in Financial Engineering and Industrial and Operations Engineering from the University of Michigan. He obtained his Bachelor’s degree in Mechanical Engineering from the Indian Institute of Technology, Bombay. He is also a CFA charterholder.

IPOs and Catalysts/Events

Weekly Deals Digest (17 May) - Kakaku, Paltac, Nippon Dry Chem, Shinko Shoji, Baoye, ENN, OOh!Media

Merger Arb Mondays (25 May) - Kakaku, Nippon Dry Chem, Skyworth, Changhong Jiahua, Shengmu, Qoria

Kakaku.com (2371 JP): Digital Garage Moves to Thwart Bain/LY

Kakaku.com (2371 JP): Pass the Popcorn as EQT Launches a Tender Offer

Kakaku.com (2371 JP): Thoughts on a Potential EQT Privatisation Offer

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Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>On 13 May, Bain/<a href="https://www.smartkarma.com/entities/ly-corp" target="_blank" data-smartkarma-citation="entities:19603:1" rel="noopener">LY (4689 JP)</a> sent <a href="https://www.smartkarma.com/entities/kakaku-com-inc" target="_blank" data-smartkarma-citation="entities:7408:1" rel="noopener">Kakaku.com Inc (2371 JP)</a> a revised non-binding offer at JPY3,232, a 7.7% premium to EQT’s JPY3,000 offer but 4.9% below the last close.</li>
<li>While remaining non-binding, the Board will be forced to engage under its fiduciary-out clause and <a href="https://www.smartkarma.com/entities/digital-garage-inc" target="_blank" data-smartkarma-citation="entities:13747:1" rel="noopener">Digital Garage (4819 JP)</a> and <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI Corp (9433 JP)</a>’s competing-offer clauses.</li>
<li>Bain/LY’s second offer, belatedly and publicly, sets in motion an auction process. My analysis suggests that a competing bidding war could result in an offer of at least JPY3,500.</li>
</ul>


On 13 May, Bain/LY (4689 JP) sent Kakaku.com Inc (2371 JP) a revised non-binding offer at JPY3,232, a 7.7% premium to EQT’s JPY3,000 offer but 4.9% below the last close.
While remaining non-binding, the Board will be forced to engage under its fiduciary-out clause and Digital Garage (4819 JP) and KDDI Corp (9433 JP)’s competing-offer clauses.
Bain/LY’s second offer, belatedly and publicly, sets in motion an auction process. My analysis suggests that a competing bidding war could result in an offer of at least JPY3,500.


Kakaku.com (2371 JP): How High Can It Go as Bain/LY Ups the Ante?