Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

KKR & Co. Inc. operates as an investment firm. The Company manages investments such as private equity, energy, infrastructure, real estate, credit strategies, and hedge funds. KKR & Co serves clients worldwide.

<ul>
<li>The S&amp;P 500 index tracks the 500 largest names listed in the US and it is one of the most highly-tracked indices in the world.</li>
<li>The index is reviewed quarterly. The next review will be in June 2024 and the evaluation date for the rankings for the constituent selection process is 6th June 2024.</li>
<li>In this insight, we take a look at the Potential ADDs and Potential DELs for the June 2024 index rebal event and the intra-review ADDs/DELs.</li>
</ul>


The S&amp;P 500 index tracks the 500 largest names listed in the US and it is one of the most highly-tracked indices in the world.
The index is reviewed quarterly. The next review will be in June 2024 and the evaluation date for the rankings for the constituent selection process is 6th June 2024.
In this insight, we take a look at the Potential ADDs and Potential DELs for the June 2024 index rebal event and the intra-review ADDs/DELs.


Quiddity Leaderboard S&P 500 June 2024 - Minimal Changes Expected but Intrareview Changes Possible

Doosan Robotics Inc. develops and manufactures industrial equipment. The Company manufactures robots, linear actuation devices, automated production equipment, and other products. Doosan Robotics conducts businesses in South Korea.

<ul>
<li>KOSPI 200 is a Korean blue-chip index that tracks the 200 largest and most-liquid names listed in the KOSPI section of the Korea Exchange (KRX).</li>
<li>In this insight, we take a look at the names leading the race to become ADDs and DELs during the upcoming semiannual review in June 2024.</li>
<li>We expect up to <em>four</em> changes in the KOSPI 200 index during the June 2024 index rebal event (down from 5 expected last month)  based on the latest available data.</li>
</ul>


KOSPI 200 is a Korean blue-chip index that tracks the 200 largest and most-liquid names listed in the KOSPI section of the Korea Exchange (KRX).
In this insight, we take a look at the names leading the race to become ADDs and DELs during the upcoming semiannual review in June 2024.
We expect up to four changes in the KOSPI 200 index during the June 2024 index rebal event (down from 5 expected last month)  based on the latest available data.


Quiddity Leaderboard KOSPI 200 Jun 24: Four Changes Likely

Shinko Electric Industries / Event-Driven

SHINKO ELECTRIC INDUSTRIES CO., LTD. designs, manufactures, and markets advanced electronic materials, such as semiconductor packages, including leadframes, and PLP(Plastics Laminated Packages).  The Company markets its products worldwide through a network of sales offices in such places as the Philippines, Germany, and Hong Kong.

<ul>
<li>When this deal was announced, it was light. But the timing, JSR influence, large-ish float, ensured FUD would make this trade wide. It traded wider. </li>
<li>12wks ago, Shinko had much-underperformed peer Ibiden, meaning downside gap risk from undisturbed was negative as spreads were wide. I reco'd a buy. Then 5wks ago, reco'd trimming.</li>
<li>Shinko had outperformed Ibiden, and gross spreads had come in 5+% on JSR's approval. Spreads are now 3% wider than their narrowest, but gap risk has widened as Shinko outperforms.</li>
</ul>


When this deal was announced, it was light. But the timing, JSR influence, large-ish float, ensured FUD would make this trade wide. It traded wider. 
12wks ago, Shinko had much-underperformed peer Ibiden, meaning downside gap risk from undisturbed was negative as spreads were wide. I reco'd a buy. Then 5wks ago, reco'd trimming.
Shinko had outperformed Ibiden, and gross spreads had come in 5+% on JSR's approval. Spreads are now 3% wider than their narrowest, but gap risk has widened as Shinko outperforms.


Shinko Electric (6967) - Break/Gap Risk Update

JSR Corporation manufactures synthetic rubber and synthetic resins.  The Company's rubber products are used mainly for auto tires.  JSR Corporation also manufactures LCD-related materials and photo-resists.

<ul>
<li>Today after the close, the <a href="https://ssl4.eir-parts.net/doc/4185/ir_material4/227807/00.pdf" target="_blank" rel="noopener">results</a> of the <a href="https://www.smartkarma.com/entities/jsr-corp" target="_blank" data-smartkarma-citation="entities:17620:1" rel="noopener">JSR Corp (4185 JP)</a> Tender Offer were announced. Bidco JICC-02 obtained 84.36% of the shares out in the Tender Offer. </li>
<li>That means imminent index downweights, delayed index downweights, and theoretically another selldown on the last day of listed existence. </li>
<li>News which came up since the start of the Tender Offer make this a little more difficult than it might have otherwise been. </li>
</ul>


Today after the close, the results of the JSR Corp (4185 JP) Tender Offer were announced. Bidco JICC-02 obtained 84.36% of the shares out in the Tender Offer. 
That means imminent index downweights, delayed index downweights, and theoretically another selldown on the last day of listed existence. 
News which came up since the start of the Tender Offer make this a little more difficult than it might have otherwise been. 


JSR (4185) - Deal Done, Now Back End Arbs Need To Be Card Counters

Fuji Oil Company Ltd a holding company which was established through the merger of Arabian Oil Co and Fuji Oil Co.  The Company operates mining and refining crude oil, natural gas, and minerals.  AOC Holding manages subsidiarieswhich produce and sell crude oil and coal products.

<ul>
<li>In the mid-late teens, four refinery groups merged to create two refinery groups - JX and Tonen General became JXTG under <a href="https://www.smartkarma.com/entities/eneos-holdings-inc" target="_blank" data-smartkarma-citation="entities:638:1" rel="noopener">ENEOS Holdings (5020 JP)</a> and Idemitsu took over ShowaShell.</li>
<li>When Idemitsu got ShowaShell, it got 50+% in <a href="https://www.smartkarma.com/entities/toa-oil-co-ltd" target="_blank" data-smartkarma-citation="entities:11021:1" rel="noopener">Toa Oil Co Ltd (5008 JP)</a>, 6.58% of <a href="https://www.smartkarma.com/entities/fuji-oil-co-ltd" target="_blank" data-smartkarma-citation="entities:12970:1" rel="noopener">Fuji Oil Co Ltd (5017 JP)</a>. In 2020, they tried to buy in Toa.</li>
<li>That was delayed by an activist. Today, Idemitsu announced they had gone to 23% in Fuji Oil. That stake will go up before it goes down.</li>
</ul>


In the mid-late teens, four refinery groups merged to create two refinery groups - JX and Tonen General became JXTG under ENEOS Holdings (5020 JP) and Idemitsu took over ShowaShell.
When Idemitsu got ShowaShell, it got 50+% in Toa Oil Co Ltd (5008 JP), 6.58% of Fuji Oil Co Ltd (5017 JP). In 2020, they tried to buy in Toa.
That was delayed by an activist. Today, Idemitsu announced they had gone to 23% in Fuji Oil. That stake will go up before it goes down.


Idemitsu (5019): First SumiChem's, Now JERA's Stake in Fuji Oil (5017) To Go to 22%. It's Coming...

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.

Travis Lundy
Pan-Asia Catalysts/Events
• Quiddity Advisors

Quiddity Leaderboard S&P 500 June 2024 - Minimal Changes Expected but Intrareview Changes Possible

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Quiddity Leaderboard KOSPI 200 Jun 24: Four Changes Likely

The June 2024 KOSPI Review has most of the same names on the leaderboard as last month. There are now four expected changes. Still tough to trade.

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Shinko Electric (6967) - Break/Gap Risk Update

The JIC deal for Shinko Electric still has ~6mos to go until it gets settled. And that is if the schedule goes to plan. China delay risk is real,...

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JSR (4185) - Deal Done, Now Back End Arbs Need To Be Card Counters

The JIC deal for JSR is now done. Tendered total came in higher than I expected. I think that warrants a bit of care on the part of those who might...

Travis Lundy

Idemitsu (5019): First SumiChem's, Now JERA's Stake in Fuji Oil (5017) To Go to 22%. It's Coming...

Idemitsu has bought two corporate stakes in Fuji Oil to go from 6+% to nearly 22%. This is not a big surprise. There's history. Medium-long-term, a...

Travis Lundy