Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Hanwha Corporation imports and exports petrochemicals, machinery, automotives, electronics, and steel.  The Company also produces explosives for the defense and construction industries.  In addition, Hanwha manufactures automotive airbag inflators and telecommunication equipment, such as wireless phones and provides financial services through its subsidiaries.

<ul>
<li>After the Kim family-backed Hanwha Energy completed <a href="https://www.smartkarma.com/entities/hanwha-corporation" target="_blank" data-smartkarma-citation="entities:10619:1" rel="noopener">Hanwha Corporation</a>'s Partial Offer last month, <a href="https://www.smartkarma.com/entities/hanwha-galleria-corp" target="_blank" data-smartkarma-citation="entities:39998:1" rel="noopener">Hanwha Galleria (452260 KS)</a>'s VP Kim Dong-seon has now launched a Partial Offer for 17.5% in Galleria. </li>
<li>Preceding my comments on Hanwha are the current setup/unwind tables for Asia-Pacific Holdcos.</li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>


After the Kim family-backed Hanwha Energy completed Hanwha Corporation's Partial Offer last month, Hanwha Galleria (452260 KS)'s VP Kim Dong-seon has now launched a Partial Offer for 17.5% in Galleria. 
Preceding my comments on Hanwha are the current setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: More Partial Offers In The Hanwha Group Complex

Travis Lundy

SUN CORPORATION operates mainly Pachinko related business, information and communication business.  Pachinko related business includes developing, manufacturing and selling a system to control and monitor pachinko machine, and manage business operation.  Sun Corp. also manufactures Pachinko and household appliances and develops game software for family use.

<ul>
<li>On 10 June, Sun Corp subsidiary <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite DI (CLBT US)</a>'s SPAC sponsor True Wind Capital launched a Tender Offer for 19% of SunCorp at a premium but discount to NAV.</li>
<li>The price was too low. CLBT shares rose. They lifted the TOB price by 8% to ¥4750. Still too low. It was trading there. Now they have lifted to ¥5500.</li>
<li>Now a 49% premium to undisturbed, 29.4% premium to all-time high prior to the first tender. Changes in terms means this could get done. More bullish than it looks.</li>
</ul>


On 10 June, Sun Corp subsidiary Cellebrite DI (CLBT US)'s SPAC sponsor True Wind Capital launched a Tender Offer for 19% of SunCorp at a premium but discount to NAV.
The price was too low. CLBT shares rose. They lifted the TOB price by 8% to ¥4750. Still too low. It was trading there. Now they have lifted to ¥5500.
Now a 49% premium to undisturbed, 29.4% premium to all-time high prior to the first tender. Changes in terms means this could get done. More bullish than it looks.


True Wind Raises Partial Offer for Sun Corp Further, Leaving an Interesting Back End

Zhihu Inc. operates as an online share knowledge community. The Company provides a socialized website for questions and answers which enables users to obtain information through questions that provoke the opinions and views from answerers as individuals. Zhihu conducts businesses in China.

<ul>
<li>Back on the 19th July, online Q&amp;A play <a href="https://www.smartkarma.com/entities/zhihu-inc" target="_blank" data-smartkarma-citation="entities:36660:1" rel="noopener">Zhihu (2390 HK/</a><a href="https://www.smartkarma.com/entities/zhihu-technology-ltd" target="_blank" data-smartkarma-citation="entities:32185:1" rel="noopener">ZH US)</a> announced the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0719/2024071901181.pdf" target="_blank" rel="noopener">buyback</a> of 46.92mn ordinary A shares (15.9% of shares out) at HK$9.11/share (US$3.50/ADS). </li>
<li>Assuming the buyback is fully taken up, chairman Yuan Zhou's stake will increase to 44.4% from 42.9% currently (held via A shares and the weighted-voting B shares). </li>
<li>The key condition is a simple majority vote from independent shareholders. Zhihu is sitting on  net cash of US$764mn. A significantly larger buyback, or higher price, could have been initiated. </li>
</ul>


Back on the 19th July, online Q&amp;A play Zhihu (2390 HK/ZH US) announced the buyback of 46.92mn ordinary A shares (15.9% of shares out) at HK$9.11/share (US$3.50/ADS). 
Assuming the buyback is fully taken up, chairman Yuan Zhou's stake will increase to 44.4% from 42.9% currently (held via A shares and the weighted-voting B shares). 
The key condition is a simple majority vote from independent shareholders. Zhihu is sitting on  net cash of US$764mn. A significantly larger buyback, or higher price, could have been initiated. 


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.

<ul>
<li>True Wind has increased its partial offer for <a href="https://www.smartkarma.com/entities/sun-corp" target="_blank" data-smartkarma-citation="entities:10803:1" rel="noopener">Sun Corp (6736 JP)</a> by 8.0% to JPY4,750 and lowered the minimum number of shares to be purchased from 3.8 to 3.3m.</li>
<li>True Wind’s offer has inadvertently spotlighted the valuation disparity vs the <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite DI (CLBT US)</a> stake, resulting in the shares trading through terms.</li>
<li>True Wind’s revised offer will struggle to succeed as the 8% price uplift is materially lower than the 19% value increase in the Cellebrite stake (since the offer announcement).</li>
</ul>


True Wind has increased its partial offer for Sun Corp (6736 JP) by 8.0% to JPY4,750 and lowered the minimum number of shares to be purchased from 3.8 to 3.3m.
True Wind’s offer has inadvertently spotlighted the valuation disparity vs the Cellebrite DI (CLBT US) stake, resulting in the shares trading through terms.
True Wind’s revised offer will struggle to succeed as the 8% price uplift is materially lower than the 19% value increase in the Cellebrite stake (since the offer announcement).


Sun Corporation (6736 JP): The Uphill Struggle for True Wind’s Revised Partial Offer

Equity Bottom-Up

<ul>
<li>Trading comfortably through the Partial Offer terms, <a href="https://www.smartkarma.com/entities/sun-corp" target="_blank" data-smartkarma-citation="entities:10803:1" rel="noopener">Sun Corp (6736 JP)</a> may still do nothing with its <a href="https://www.smartkarma.com/entities/cellebrite-di-ltd" target="_blank" data-smartkarma-citation="entities:37102:1" rel="noopener">Cellebrite DI (CLBT US)</a> holding towards narrowing the NAV discount.</li>
<li>Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.</li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>


Trading comfortably through the Partial Offer terms, Sun Corp (6736 JP) may still do nothing with its Cellebrite DI (CLBT US) holding towards narrowing the NAV discount.
Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: Sun Corp (6736 JP) Running Out Of Puff?

Insights on Partial Offer/Partial Tender Offers