Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Shin-Etsu Chemical Co., Ltd. produces and distributes synthetic resins and other chemical products such as fertilizers. The Company also manufactures electronic materials such as semiconductor silicon, synthetic, and rare earth quartz. Shin-Etsu Chemical operates in Japan and overseas.

<ul>
<li>Today, <a href="https://www.smartkarma.com/entities/shin-etsu-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:4481:1" rel="noopener">Shin Etsu Chemical (4063 JP)</a> announced a second buyback this year (first ¥100bn was announced in May, buying back 16.695mm shs (0.83%). This time, ~¥94bn via Own-Share Tender Offer.</li>
<li>Three non-life insurers and two banks who together hold 6+% will sell a total of ~1.01% at ~10% below last. They will then sell the rest of their shares later.</li>
<li>Cute, but not enough. Shin-Etsu is cash-rich, securities-rich, receivables and inventory-rich. And nearly ¥1trln of EBITDA. They are a key part of the tech infrastructure. They can borrow.</li>
</ul>


Today, Shin Etsu Chemical (4063 JP) announced a second buyback this year (first ¥100bn was announced in May, buying back 16.695mm shs (0.83%). This time, ~¥94bn via Own-Share Tender Offer.
Three non-life insurers and two banks who together hold 6+% will sell a total of ~1.01% at ~10% below last. They will then sell the rest of their shares later.
Cute, but not enough. Shin-Etsu is cash-rich, securities-rich, receivables and inventory-rich. And nearly ¥1trln of EBITDA. They are a key part of the tech infrastructure. They can borrow.


Shin-Etsu Chemical (4063) - Small/Large Below-Market Tender Offer Buyback, Followed by Overhang

EXEDY Corporation manufactures drivetrain products for automobiles, industrial vehicles, and construction machinery.  The Company's products include manual clutches, torque converters, power shift transmissions, and hydraulic clutches. Exedy has its subsidiaries in South Korea, Australia, the US and the UK.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/exedy-corp" target="_blank" data-smartkarma-citation="entities:6516:1" rel="noopener">Exedy Corp (7278 JP)</a> announced an offering of 36% of its shares at end-May. Long-time "owner" <a href="https://www.smartkarma.com/entities/aisin-corp" target="_blank" data-smartkarma-citation="entities:11809:1" rel="noopener">Aisin (7259 JP)</a> was getting out. Since then, the company has bought back shares.</li>
<li>Activist Murakami Group has bought 27% of the company. Between Murakami and the buyback, the public has net sold 5% of the company since end-March. Kinda shocking.</li>
<li>There is another 35% of Max Real World Float to buy back, and at current pace, they'll be done by mid-March 2025. Then what? That's the really big question.</li>
</ul>



Exedy Corp (7278 JP) announced an offering of 36% of its shares at end-May. Long-time "owner" Aisin (7259 JP) was getting out. Since then, the company has bought back shares.
Activist Murakami Group has bought 27% of the company. Between Murakami and the buyback, the public has net sold 5% of the company since end-March. Kinda shocking.
There is another 35% of Max Real World Float to buy back, and at current pace, they'll be done by mid-March 2025. Then what? That's the really big question.


[Japan Activism] Exedy (7278 JP) - Buying Back Bigly

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>U.S. stocks declined, dragged down by a hotter-than-expected producer price index report that increased wholesale prices by 0.4%</li>
<li>Marubeni plans to accelerate asset sales, targeting at least ¥160 billion annually from FY2026, a 30% increase from the previous three-year average</li>
<li>Oji Holdings will undertake a share buyback program, purchasing up to 100 million shares (10.1% of total issued shares) for as much as ¥50 billion</li>
</ul>


U.S. stocks declined, dragged down by a hotter-than-expected producer price index report that increased wholesale prices by 0.4%
Marubeni plans to accelerate asset sales, targeting at least ¥160 billion annually from FY2026, a 30% increase from the previous three-year average
Oji Holdings will undertake a share buyback program, purchasing up to 100 million shares (10.1% of total issued shares) for as much as ¥50 billion


Ohayo Japan | Inflation Jitters Drag Down Tech Stocks

Oji Holdings Corp manufactures paper, pulp, and processed paper goods, including news print, carbonless paper, wrapping and packaging paper, and paperboard. The Company also produces sanitary paper goods such as disposable diapers. Oji Paper has forests in Japan and overseas, and operates forestry, timber sales, and real estate businesses.

<ul>
<li>Paper manufacturer <a href="https://www.smartkarma.com/entities/oji-holdings-corp" target="_blank" data-smartkarma-citation="entities:11348:1" rel="noopener">Oji Holdings (3861 JP)</a> has spent 25 years not going anywhere. Their current MTMP isn't exciting. And it looks like they will fail worse than last time.</li>
<li>But an activist put their head above the parapet recently, and now the company has announced larger new cross-holding selldown targets, and a big 9% buyback, with a ToSTNeT-3 tomorrow. </li>
<li>The stock is at 0.47x book. They have nearly ¥400bn of financial assets which are non-core. They have land and property holdings. And they have lots of cross-holdings to repurchase.</li>
</ul>


Paper manufacturer Oji Holdings (3861 JP) has spent 25 years not going anywhere. Their current MTMP isn't exciting. And it looks like they will fail worse than last time.
But an activist put their head above the parapet recently, and now the company has announced larger new cross-holding selldown targets, and a big 9% buyback, with a ToSTNeT-3 tomorrow. 
The stock is at 0.47x book. They have nearly ¥400bn of financial assets which are non-core. They have land and property holdings. And they have lots of cross-holdings to repurchase.


Oji Paper (3861 JP) - Big New Buyback After Crossholding Sales And An Activist Peeking From Register

Japan Experts, Extraordinary Performance, Astris Advisory Japan

Astris Advisory Japan

Japan Experts, Extraordinary Performance

Our Corporate Advisory service is designed to give clients access to a wider range of investors. These include Japan specialists as well as global investors. The goal is to help achieve a fair equity valuation.

Equity Bottom-Up

Aoyama Zaisan Networks Co Lt / Equity Bottom-Up

Aoyama Zaisan Networks Company,Limited operates as a property consulting company. The Company offers inherited property and business succession, individual asset consulting, and corporate finance consulting services. Aoyama Zaisan Networks serves customers in Japan.

<ul><li>By driving double-digit sales and OP growth at both Wealth Consulting and Real Estate Solutions during Q1-3 FY12/24, the company continues to demonstrate positive earnings momentum as well as its ability to ride the powerful trend in Japan’s aging demographics.</li><li>Management continues to show improvement in capital allocation by announcing an earnings- accretive acquisition of the Chester Group, a domestic inheritance specialist firm, together with a 5.12% share buyback program.</li><li>This approach to reinvesting capital into the growth of the business together with the buyback shows an effort to offset dilution, demonstrating a commitment to shareholder value and financial strength.</li></ul>

By driving double-digit sales and OP growth at both Wealth Consulting and Real Estate Solutions during Q1-3 FY12/24, the company continues to demonstrate positive earnings momentum as well as its ability to ride the powerful trend in Japan’s aging demographics.Management continues to show improvement in capital allocation by announcing an earnings- accretive acquisition of the Chester Group, a domestic inheritance specialist firm, together with a 5.12% share buyback program.This approach to reinvesting capital into the growth of the business together with the buyback shows an effort to offset dilution, demonstrating a commitment to shareholder value and financial strength.

Aoyama Zaisan Networks Company (8929 JP) - Proactive Capital Allocation

Japan Buybacks
Insights on Japanese buybacks

Shin-Etsu Chemical (4063) - Small/Large Below-Market Tender Offer Buyback, Followed by Overhang

Shin-Etsu Chem will buy 1% of shares in a Tender Offer Buyback. This highlights ShinEtsu is cash-rich, has crossholders who are selling and will...

Travis Lundy

[Japan Activism] Exedy (7278 JP) - Buying Back Bigly

Exedy is buying back shares very aggressively. On an average day since they started 12 Nov, they are 28% of the volume. At this pace, they will...

Travis Lundy

Ohayo Japan | Inflation Jitters Drag Down Tech Stocks

U.S. stocks fall due to higher wholesale prices, Marubeni to increase asset sales, Oji Holdings announces share buyback program.

Mark Chadwick

Oji Paper (3861 JP) - Big New Buyback After Crossholding Sales And An Activist Peeking From Register

Oji Paper announced a higher cross-holding selldown target in Nov24. Yesterday, they announced a big buyback. The stock is <10x EPS and 0.47x book....

Travis Lundy

Aoyama Zaisan Networks Company (8929 JP) - Proactive Capital Allocation

By driving double-digit sales and OP growth at both Wealth Consulting and Real Estate Solutions during Q1-3 FY12/24, the company continues to...

Astris Advisory Japan

Shin-Etsu Chemical (4063) - Small/Large Below-Market Tender Offer Buyback, Followed by Overhang

Shin-Etsu Chem will buy 1% of shares in a Tender Offer Buyback. This highlights ShinEtsu is cash-rich, has crossholders who are selling and will...

Travis Lundy

[Japan Activism] Exedy (7278 JP) - Buying Back Bigly

Exedy is buying back shares very aggressively. On an average day since they started 12 Nov, they are 28% of the volume. At this pace, they will...

Travis Lundy

Ohayo Japan | Inflation Jitters Drag Down Tech Stocks

​U.S. stocks fall due to higher wholesale prices, Marubeni to increase asset sales, Oji Holdings announces share buyback program.

Mark Chadwick

Oji Paper (3861 JP) - Big New Buyback After Crossholding Sales And An Activist Peeking From Register

Oji Paper announced a higher cross-holding selldown target in Nov24. Yesterday, they announced a big buyback. The stock is <10x EPS and 0.47x book....

Travis Lundy

Aoyama Zaisan Networks Company (8929 JP) - Proactive Capital Allocation

By driving double-digit sales and OP growth at both Wealth Consulting and Real Estate Solutions during Q1-3 FY12/24, the company continues to...

Astris Advisory Japan

U.S. stocks fall due to higher wholesale prices, Marubeni to increase asset sales, Oji Holdings announces share buyback program.