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

Nitori's Bid for Shimachu Goes Friendly as Shimachu Dumps DCM

Nitori To Make a Rival Bid for Shimachu? More Fun To Go

DCM Does a Full Takeover of Shimachu - Looks Like a Strong Price. Look Again.

Targeting Nitori: Cainz Follows Workman’s Success into Homeware Retailing with Style Factory Chain

Quiddity Advisors

Event-Driven

<p>That <a href="https://www.smartkarma.com/entities/nitori-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20386:1" rel="noopener">Nitori Holdings (9843 JP)</a> has had an interest in <a href="https://www.smartkarma.com/entities/shimachu-co-ltd" target="_blank" data-smartkarma-citation="entities:5235:1" rel="noopener">Shimachu Co Ltd (8184 JP)</a> hasn't been secret, per se, since the Nikkei article on the 20th. That it has had a <em>deep</em> rather than passing interest has been seen in the tone and depth of the media articles which have followed this expression of interest. In <a href="https://www.smartkarma.com/insights/nitori-to-make-a-rival-bid-for-shimachu-more-fun-to-go" target="_blank" data-smartkarma-citation="insights:44353" rel="noopener">Nitori To Make a Rival Bid for Shimachu? More Fun To Go</a> I suggested their presence made for more fun and today we got more fun.   </p><p>Today Nitori showed that it has a strong interest as it bid well through the mid-point of the DCF valuation range from its financial advisor, and just a few percent shy of its top end. </p><p>The bid at ¥5500/share is now announced, and as long as the conditions remain un-breached, Nitori intends to launch a Tender Offer when the defeating conditions are met, without regard to whether Shimachu recommends the deal or not. Functionally, this means an "OK" from the JFTC and lack of serious intervention by Shimachu. The Offer is expected to launch, assuming conditions permit, by "mid November" (which I would take to mean latter half.</p><p>This was a buy at ¥3500-3600 in late Sep when it was "just" a potential partial offer. It became a buy when it was at terms at ¥4200 and was too cheap. Now Nitori has come in and bid ¥5500/share it starts looking like we are closer to a fuller price. Not completely full mind you, but fuller. </p><p>Tactics and response start to come into play. Will DCM respond? Will Shimachu's Independent Committee take the Nitori bid seriously? Will Shimachu reject?</p><p>There are a bunch of moving parts here and while I tried to offer a preview in <a href="https://www.smartkarma.com/insights/gaming-out-a-nitori-bid-for-shimachu" target="_blank" data-smartkarma-citation="insights:44636" rel="noopener">Gaming Out a Nitori Bid for Shimachu</a> this bid actually probably falls between the cracks so I take yet another look. </p><p>More below the fold. </p><hr><table class="table table-striped"><tbody>
<tr><td colspan="2" style="width: 133.636px;"><h2>Insights so far in the series</h2></td></tr>
<tr>
<td style="width: 133.636px;"><strong>Date</strong></td>
<td style="width: 569.091px;"><strong>Title</strong></td>
</tr>
<tr>
<td style="width: 133.636px;">21 Sep 2020</td>
<td style="width: 569.091px;">
<a href="https://www.smartkarma.com/insights/dcm-partial-offer-for-shimachu-coming" target="_blank" data-smartkarma-citation="insights:43444" rel="noopener">DCM Partial Offer for Shimachu Coming?</a> </td>
</tr>
<tr>
<td style="width: 133.636px;">4 Oct 2020</td>
<td style="width: 569.091px;">
<a href="https://www.smartkarma.com/insights/dcm-does-a-full-takeover-of-shimachu-looks-like-a-strong-price-look-again" target="_blank" data-smartkarma-citation="insights:43806" rel="noopener">DCM Does a Full Takeover of Shimachu - Looks Like a Strong Price. Look Again.</a> </td>
</tr>
<tr>
<td style="width: 133.636px;">21 Oct 2020</td>
<td style="width: 569.091px;">
<a href="https://www.smartkarma.com/insights/nitori-to-make-a-rival-bid-for-shimachu-more-fun-to-go" target="_blank" data-smartkarma-citation="insights:44353" rel="noopener">Nitori To Make a Rival Bid for Shimachu? More Fun To Go</a> </td>
</tr>
<tr>
<td style="width: 133.636px;">28 Oct 2020</td>
<td style="width: 569.091px;">
<a href="https://www.smartkarma.com/insights/gaming-out-a-nitori-bid-for-shimachu" target="_blank" data-smartkarma-citation="insights:44636" rel="noopener">Gaming Out a Nitori Bid for Shimachu</a> </td>
</tr>
<tr><td colspan="2"></td></tr>
<tr><td colspan="2" style="width: 133.636px;"><em><strong>Additional recommended reading, by <a href="https://www.smartkarma.com/profiles/michael-causton" target="_blank" data-smartkarma-citation="accounts:2415" rel="noopener">Michael Causton</a> </strong></em></td></tr>
<tr>
<td style="width: 133.636px;">4 Oct 2020</td>
<td style="width: 569.091px;">
<a href="https://www.smartkarma.com/insights/a-new-era-of-home-centre-consolidation-starts-as-dcm-buys-shimachu" target="_blank" data-smartkarma-citation="insights:43851" rel="noopener">A New Era of Home Centre Consolidation Starts as DCM Buys Shimachu</a> </td>
</tr>
</tbody></table>

That Nitori Holdings (9843 JP) has had an interest in Shimachu Co Ltd (8184 JP) hasn't been secret, per se, since the Nikkei article on the 20th. That it has had a deep rather than passing interest has been seen in the tone and depth of the media articles which have followed this expression of interest. In Nitori To Make a Rival Bid for Shimachu? More Fun To Go I suggested their presence made for more fun and today we got more fun.   Today Nitori showed that it has a strong interest as it bid well through the mid-point of the DCF valuation range from its financial advisor, and just a few percent shy of its top end. The bid at ¥5500/share is now announced, and as long as the conditions remain un-breached, Nitori intends to launch a Tender Offer when the defeating conditions are met, without regard to whether Shimachu recommends the deal or not. Functionally, this means an "OK" from the JFTC and lack of serious intervention by Shimachu. The Offer is expected to launch, assuming conditions permit, by "mid November" (which I would take to mean latter half.This was a buy at ¥3500-3600 in late Sep when it was "just" a potential partial offer. It became a buy when it was at terms at ¥4200 and was too cheap. Now Nitori has come in and bid ¥5500/share it starts looking like we are closer to a fuller price. Not completely full mind you, but fuller. Tactics and response start to come into play. Will DCM respond? Will Shimachu's Independent Committee take the Nitori bid seriously? Will Shimachu reject?There are a bunch of moving parts here and while I tried to offer a preview in Gaming Out a Nitori Bid for Shimachu this bid actually probably falls between the cracks so I take yet another look. More below the fold. 
Insights so far in the series

Date
Title


21 Sep 2020

DCM Partial Offer for Shimachu Coming? 


4 Oct 2020

DCM Does a Full Takeover of Shimachu - Looks Like a Strong Price. Look Again. 


21 Oct 2020

Nitori To Make a Rival Bid for Shimachu? More Fun To Go 


28 Oct 2020

Gaming Out a Nitori Bid for Shimachu 


Additional recommended reading, by Michael Causton 

4 Oct 2020

A New Era of Home Centre Consolidation Starts as DCM Buys Shimachu 



ニトリ、島忠買収で買収額を引き上げ ― 景気減速の兆し