Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

S LINE CO., LTD. provides trucking transportation services mainly in the Tokai and Kansai areas.  The Company develops on-line transport information system designed for efficient distribution services.  S Line offers international door-to-door shipping services as well.

<ul>
<li>Today, <a href="https://www.smartkarma.com/entities/s-line-co-ltd" target="_blank" data-smartkarma-citation="entities:8076:1" rel="noopener">S Line Co Ltd (9078 JP)</a> announced its CEO would conduct a Tender Offer MBO to buy out the ¥50bn-target revenue logistics company, at 0.6x book. </li>
<li>The company announced results with revenues up. But withdrew its existing MTMP which said revenues would be up 10% from here to March 2025 and ROE would be higher.</li>
<li>This is the wrong price. It should engender some upset, but active investors own almost nothing it seems. </li>
</ul>


Today, S Line Co Ltd (9078 JP) announced its CEO would conduct a Tender Offer MBO to buy out the ¥50bn-target revenue logistics company, at 0.6x book. 
The company announced results with revenues up. But withdrew its existing MTMP which said revenues would be up 10% from here to March 2025 and ROE would be higher.
This is the wrong price. It should engender some upset, but active investors own almost nothing it seems. 


S Line (9078 JP) TOB/MBO at 0.57x Book - Wrong Price by Far but Only AGGRESSIVE Activism Blocks It

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

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.

NAGATANIEN HOLDINGS CO., LTD. produces and sells Japanese-styled prepared foods, including flavor powder for rice and Japanese-styled omelets.  The Company also produces Chinese and Western-styled prepared foods, including pancake mix and spicy Chinese tofu.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nagatanien-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:8059:1" rel="noopener">Nagatanien Holdings (2899 JP)</a> recommended a Marunouchi Capital-sponsored MBO at JPY3,100, a 38.4% premium to the undisturbed price. </li>
<li>The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The offer period is from 4 June to 16 July.</li>
<li>While not a knockout bid, the offer represents a five-year high and requires a 58% minority acceptance rate. This is a done deal with payment commencing from 23 July.  </li>
</ul>



Nagatanien Holdings (2899 JP) recommended a Marunouchi Capital-sponsored MBO at JPY3,100, a 38.4% premium to the undisturbed price. 
The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The offer period is from 4 June to 16 July.
While not a knockout bid, the offer represents a five-year high and requires a 58% minority acceptance rate. This is a done deal with payment commencing from 23 July.  


Nagatanien Holdings (2899 JP): Marunouchi Capital-Sponsored MBO at JPY3,100

<ul>
<li>MitCorp - the largest shareholder - and the Nagatani family - today announced an MBO where they will buy a classic ubiquitous brand at an Adjusted EV of 5.4x EBITDA.</li>
<li>The equity check appears to buy at ~2.5x Mar27-29 average FCF but they probably have 50% of the shares in the bag. Retail, or who they sell to, matter.</li>
<li>There is room for a noisy activist to get involved here and disrupt the retail ownership. But there are very few of those around. And none in it now.</li>
</ul>


MitCorp - the largest shareholder - and the Nagatani family - today announced an MBO where they will buy a classic ubiquitous brand at an Adjusted EV of 5.4x EBITDA.
The equity check appears to buy at ~2.5x Mar27-29 average FCF but they probably have 50% of the shares in the bag. Retail, or who they sell to, matter.
There is room for a noisy activist to get involved here and disrupt the retail ownership. But there are very few of those around. And none in it now.


Another Day Ending in Y, Another MBO Done Too Cheap. Today? Nagatanien (2899 JP).

I'rom Group Co., Ltd. provides management services on clinical trials and staffing consulting services including providing nurses, pharmacists, and clinical pathologists to medical institutions as well as training medicalrelated staffs.  The Company also provides and leases facilities and finances for these who are to start their clinics.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/i-rom-group-co-ltd" target="_blank" data-smartkarma-citation="entities:2686:1" rel="noopener">I'Rom Group (2372 JP)</a> recommended a <a href="https://www.smartkarma.com/entities/blackstone-inc" target="_blank" data-smartkarma-citation="entities:27166:1" rel="noopener">Blackstone (BX US)</a>-sponsored pre-conditional MBO at JPY2,800, a 49.5% premium to the undisturbed price. </li>
<li>Approvals under the competition laws of Japan and Australia are a precondition. The tender offer is expected to start in mid-June.</li>
<li>The offer is attractive and requires a 37% minority acceptance rate. While the timing of regulatory approvals is a risk, the transaction is a done deal.</li>
</ul>



I'Rom Group (2372 JP) recommended a Blackstone (BX US)-sponsored pre-conditional MBO at JPY2,800, a 49.5% premium to the undisturbed price. 
Approvals under the competition laws of Japan and Australia are a precondition. The tender offer is expected to start in mid-June.
The offer is attractive and requires a 37% minority acceptance rate. While the timing of regulatory approvals is a risk, the transaction is a done deal.


I'rom Group (2372 JP): Blackstone-Sponsored Pre-Conditional MBO at JPY2,800

<ul>
<li>Today SMO and CRO operator <a href="https://www.smartkarma.com/entities/i-rom-group-co-ltd" target="_blank" data-smartkarma-citation="entities:2686:1" rel="noopener">I'Rom Group (2372 JP)</a> announced an MBO where Blackstone would be the sponsor.</li>
<li>From outward appearances, it would seem to be an estate management exercise. It's not particularly rich as a bid, but it isn't awful. </li>
<li>I expect this gets done as Mori-san and family and friends appear to have 58% going in. Expected to start in June.</li>
</ul>


Today SMO and CRO operator I'Rom Group (2372 JP) announced an MBO where Blackstone would be the sponsor.
From outward appearances, it would seem to be an estate management exercise. It's not particularly rich as a bid, but it isn't awful. 
I expect this gets done as Mori-san and family and friends appear to have 58% going in. Expected to start in June.


Blackstone to Take I'rom (2372 JP) Private in MBO at ¥2800/Share (49% Premium)

Japan MBOs
Insights on Japanese MBOs

S Line (9078 JP) TOB/MBO at 0.57x Book - Wrong Price by Far but Only AGGRESSIVE Activism Blocks It

S Line's MBO at 0.57x book is VERY low compared to other recent deals in logistics space. Embarrassingly so. I noted it needed aggressive activism...

Travis Lundy

Nagatanien Holdings (2899 JP): Marunouchi Capital-Sponsored MBO at JPY3,100

While not a knockout bid, the offer represents a five-year high and requires a 58% minority acceptance rate. This is a done deal with payment...

Arun George

Another Day Ending in Y, Another MBO Done Too Cheap. Today? Nagatanien (2899 JP).

MBOs are a pox on the governance of Japan. Boards never put them up for auction the way they put up companies when management is unhappy with...

Travis Lundy

I'rom Group (2372 JP): Blackstone-Sponsored Pre-Conditional MBO at JPY2,800

The offer is attractive and requires a 37% minority acceptance rate. While the timing of regulatory approvals is a risk, the transaction is a done...

Arun George

S Line (9078 JP) TOB/MBO at 0.57x Book - Wrong Price by Far but Only AGGRESSIVE Activism Blocks It

S Line's MBO at 0.57x book is VERY low compared to other recent deals in logistics space. Embarrassingly so. I noted it needed aggressive activism...

Travis Lundy

Nagatanien Holdings (2899 JP): Marunouchi Capital-Sponsored MBO at JPY3,100

While not a knockout bid, the offer represents a five-year high and requires a 58% minority acceptance rate. This is a done deal with payment...

Arun George

Another Day Ending in Y, Another MBO Done Too Cheap. Today? Nagatanien (2899 JP).

MBOs are a pox on the governance of Japan. Boards never put them up for auction the way they put up companies when management is unhappy with...

Travis Lundy

I'rom Group (2372 JP): Blackstone-Sponsored Pre-Conditional MBO at JPY2,800

The offer is attractive and requires a 37% minority acceptance rate. While the timing of regulatory approvals is a risk, the transaction is a done...

Arun George

Blackstone to Take I'rom (2372 JP) Private in MBO at ¥2800/Share (49% Premium)

Blackstone is sponsoring the other part of an MBO where CEO Mori-san who controls 47% is taking out the reasonably fast-growing SMO/CRO business at...

Travis Lundy