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

Z Fin (1168 HK): Despite the High Takeover Premium, the Offer Is Well Short of Intrinsic Value

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Global Equity Research Ltd

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Event-Driven

<ul>
<li>Mr Yaping Ou's offer for <a href="https://www.smartkarma.com/entities/z-fin-limited" target="_blank" data-smartkarma-citation="entities:9999:1" rel="noopener">Z Fin (1168 HK)</a> is HK$6.60 and is final. The scheme document is now due on 30 October, and the gross spread is 35%.</li>
<li>The offer undervalues Z Fin. The ZA Global stake alone is worth about HK$10.2–10.5 per share. That means the offer values the rest of Z Fin at below zero.</li>
<li>Vote risk and payoff: If minority turnout matches the last AGM, about 5.3m votes against could block the scheme. That's less than past AGM dissent. The risk/reward is not compelling.</li>
</ul>


Mr Yaping Ou's offer for Z Fin (1168 HK) is HK$6.60 and is final. The scheme document is now due on 30 October, and the gross spread is 35%.
The offer undervalues Z Fin. The ZA Global stake alone is worth about HK$10.2–10.5 per share. That means the offer values the rest of Z Fin at below zero.
Vote risk and payoff: If minority turnout matches the last AGM, about 5.3m votes against could block the scheme. That's less than past AGM dissent. The risk/reward is not compelling.


Z Fin (1168 HK): A High Spread That Reflects Real Vote Risk