Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<p>On 19 April, <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> made a conditional voluntary tender offer for all shares in <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> that it did not hold at THB 65/share.</p><p>In the event that <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a>'s tender offer results in them holding over 50% of the voting rights in <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a>, it also announced that it would make a downstream offer for <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a> at THB 122.86/share, while requesting the SEC for a waiver of the obligation to make a tender offer for all shares of <a href="https://www.smartkarma.com/entities/thaicom-pcl" target="_blank" data-smartkarma-citation="entities:18019:1" rel="noopener">Thaicom Pcl (THCOM TB)</a>.</p><p>The record date to attend the <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> shareholder EGM is 14 May and the EGM will be held on 25 June.</p><p><a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a> is a large shareholder in <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> and media reports indicate that they will not tender their shares. <a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a> said that they view their stakes in <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> and <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a> as strategic investments.</p><p><a href="https://www.smartkarma.com/entities/kce-electronics-pcl" target="_blank" data-smartkarma-citation="entities:1892:1" rel="noopener">Kce Electronics Pub (KCE TB)</a> is the most likely replacement candidate for <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> in the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">Stock Exchange of Thailand SET 50 Index (SET50 INDEX)</a>.</p>

On 19 April, Gulf Energy Development Public Company (GULF TB) made a conditional voluntary tender offer for all shares in Intouch Holdings (INTUCH TB) that it did not hold at THB 65/share.In the event that Gulf Energy Development Public Company (GULF TB)'s tender offer results in them holding over 50% of the voting rights in Intouch Holdings (INTUCH TB), it also announced that it would make a downstream offer for Advanced Info Service (ADVANC TB) at THB 122.86/share, while requesting the SEC for a waiver of the obligation to make a tender offer for all shares of Thaicom Pcl (THCOM TB).The record date to attend the Gulf Energy Development Public Company (GULF TB) shareholder EGM is 14 May and the EGM will be held on 25 June.Singtel (ST SP) is a large shareholder in Intouch Holdings (INTUCH TB) and media reports indicate that they will not tender their shares. Singtel (ST SP) said that they view their stakes in Intouch Holdings (INTUCH TB) and Advanced Info Service (ADVANC TB) as strategic investments.Kce Electronics Pub (KCE TB) is the most likely replacement candidate for Intouch Holdings (INTUCH TB) in the Stock Exchange of Thailand SET 50 Index (SET50 INDEX).

GULF Offer for INTUCH: Index Implications

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.

<p>On 19 April, <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a>, which is controlled by billionaire Sarath Ratanavadi, announced a conditional voluntary tender offer to acquire all of <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a>’s shares for THB65.00 cash per share, an 11.1% premium to the unaffected price of THB58.50 per share. As of 16 April, Gulf Energy’s shareholding in Intouch stood at 18.93% of the outstanding shares. </p><p>If the tender offer results in Gulf Energy holding 50% or more of Intouch’s total voting rights, Gulf Energy will be required to make tender offers for all the shares of <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a> and <a href="https://www.smartkarma.com/entities/thaicom-pcl" target="_blank" data-smartkarma-citation="entities:18019:1" rel="noopener">Thaicom Pcl (THCOM TB)</a> based on the chain principle. The potential tender offer price for Advanced Info Services is THB122.86 per share, which is a -27% discount to the unaffected price of THB168 per share.</p><p>In response to the announcement, <a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a> which owns 21.00% of Intouch and 23.32% of Advanced Info Services, stated that it “<em>views its stakes in INTUCH and ADVANC as strategic investments and we believe in the long term outlook of the businesses.</em>” Singtel will review its strategic options to ensure that Intouch and Advanced Info Services shareholders get the full benefit of the intrinsic value of the businesses.</p><div class="content-highlight"><p>The launch of the Intouch tender offer is subject to key conditions precedents which are Gulf Energy shareholder approval (no less than three-quarters of the total votes from shareholders with no conflict of interests) and SEC waiver for the requirement to make a tender offer for Thaicom according to the chain principle. Post EGM approval for the tender, Gulf Energy may also buy Intouch shares before and after the tender. The tender offer has no minimum acceptance condition. Overall, we think the tender offer price is fair. </p></div>

On 19 April, Gulf Energy Development Public Company (GULF TB), which is controlled by billionaire Sarath Ratanavadi, announced a conditional voluntary tender offer to acquire all of Intouch Holdings (INTUCH TB)’s shares for THB65.00 cash per share, an 11.1% premium to the unaffected price of THB58.50 per share. As of 16 April, Gulf Energy’s shareholding in Intouch stood at 18.93% of the outstanding shares. If the tender offer results in Gulf Energy holding 50% or more of Intouch’s total voting rights, Gulf Energy will be required to make tender offers for all the shares of Advanced Info Service (ADVANC TB) and Thaicom Pcl (THCOM TB) based on the chain principle. The potential tender offer price for Advanced Info Services is THB122.86 per share, which is a -27% discount to the unaffected price of THB168 per share.In response to the announcement, Singtel (ST SP) which owns 21.00% of Intouch and 23.32% of Advanced Info Services, stated that it “views its stakes in INTUCH and ADVANC as strategic investments and we believe in the long term outlook of the businesses.” Singtel will review its strategic options to ensure that Intouch and Advanced Info Services shareholders get the full benefit of the intrinsic value of the businesses.The launch of the Intouch tender offer is subject to key conditions precedents which are Gulf Energy shareholder approval (no less than three-quarters of the total votes from shareholders with no conflict of interests) and SEC waiver for the requirement to make a tender offer for Thaicom according to the chain principle. Post EGM approval for the tender, Gulf Energy may also buy Intouch shares before and after the tender. The tender offer has no minimum acceptance condition. Overall, we think the tender offer price is fair. 

Intouch’s Conditional Voluntary Tender Offer from Gulf Energy

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<div>
<p>On the 26 June 2020, <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> disclosed it held 147mn shares (~4.58%) in <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a>. Gulf continued to increase its stake - and make public announcements after the fact - culminating in a holding of 15% on <a href="https://www.nationthailand.com/news/30402235" target="_blank" rel="noopener">28 January</a>.</p>
<p>In its FY20 results, the <a href="https://www.set.or.th/dat/news/202102/21018001.pdf" target="_blank" rel="noopener">management discussion</a> shed no new light as to their forward intention on Intouch.</p>
<p>Technically, Gulf could take its take all the way up to 24.99% before it was obligated to make an MGO - see <em><a href="https://skr.ma/m2vxP" target="_blank" rel="noopener">Quiddity M&amp;A Guide 2021: Thailand</a></em>.</p>
<p>But an energy company making a tilt for a satellite, internet, and telecommunications company?</p>
</div>
<hr>
<div>
<div>
<h3>The New News</h3>
<p>Gulf has <a href="https://www.set.or.th/set/pdfnews.do?newsId=16187886028860&amp;sequence=0" target="_blank" rel="noopener">announced</a> it intends to make a Voluntary Tender Offer (VTO) for shares not held in Intouch at Bt65/share. If it gets to 50%, it will make a downstream offer for <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl-ca1a971f-2f70-4565-b1fd-dda5b533acd3" target="_blank" data-smartkarma-citation="entities:27653:1" rel="noopener">Advanced Info Service PCL (ADVANC-R TB)</a> at Bt122.86/share. The VTO is conditional, amongst other things, on a waiver NOT to make a  downstream offer for <a href="https://www.smartkarma.com/entities/thaicom-pcl" target="_blank" data-smartkarma-citation="entities:18019:1" rel="noopener">Thaicom Pcl (THCOM TB</a>.</p>
<p>Bt65/share is bang-in-line with Intouch's NAV/share.</p>
<p>The Tender Offer has no minimum acceptance condition.</p>
<p>Gulf currently holds 18.93% (there was no prior announcement they had cleared 15%) of shares outstanding. If Singtel (21%) and Temasek (5.2%) tender, Gulf only needs another 4.87% to clear 50%.</p>
</div>
</div>
<div>
<p>Talk about being caught off-guard. I did not expect Gulf to lift its stake from 5% to 10%, then again to 15%. And I certainly did not expect a full Offer for Intouch.</p>
<p>More below the fold.</p>
</div>


On the 26 June 2020, Gulf Energy Development Public Company (GULF TB) disclosed it held 147mn shares (~4.58%) in Intouch Holdings (INTUCH TB). Gulf continued to increase its stake - and make public announcements after the fact - culminating in a holding of 15% on 28 January.
In its FY20 results, the management discussion shed no new light as to their forward intention on Intouch.
Technically, Gulf could take its take all the way up to 24.99% before it was obligated to make an MGO - see Quiddity M&amp;A Guide 2021: Thailand.
But an energy company making a tilt for a satellite, internet, and telecommunications company?




The New News
Gulf has announced it intends to make a Voluntary Tender Offer (VTO) for shares not held in Intouch at Bt65/share. If it gets to 50%, it will make a downstream offer for Advanced Info Service PCL (ADVANC-R TB) at Bt122.86/share. The VTO is conditional, amongst other things, on a waiver NOT to make a  downstream offer for Thaicom Pcl (THCOM TB.
Bt65/share is bang-in-line with Intouch's NAV/share.
The Tender Offer has no minimum acceptance condition.
Gulf currently holds 18.93% (there was no prior announcement they had cleared 15%) of shares outstanding. If Singtel (21%) and Temasek (5.2%) tender, Gulf only needs another 4.87% to clear 50%.



Talk about being caught off-guard. I did not expect Gulf to lift its stake from 5% to 10%, then again to 15%. And I certainly did not expect a full Offer for Intouch.
More below the fold.


Intouch Holdings: Gulf's Inexplicable Offer

<div>
<p>This week in StubWorld ...</p>
</div>
<div>
<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a>'s long-term discount to NAV and the simple ratio (Intouch over <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a>) are at all-time extremes.  <br><br><a href="https://www.smartkarma.com/entities/8122" target="_blank" data-smartkarma-citation="entities:8122:1" rel="noopener"></a>And <a href="https://www.smartkarma.com/entities/people-s-insurance-co-grou-h" target="_blank" data-smartkarma-citation="entities:362:1" rel="noopener">People's Insurance Co (PICC) (1339 HK)</a> is coming up "cheap" after fully correcting last years' narrowing.</div>
<div>Preceding my comments on Intouch and PICC, are the weekly setup/unwind tables for Asia-Pacific Holdcos.</div>
<div></div>
</div>
<div>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
</div>


This week in StubWorld ...



Intouch Holdings (INTUCH TB)'s long-term discount to NAV and the simple ratio (Intouch over Advanced Info Service (ADVANC TB)) are at all-time extremes.    And People's Insurance Co (PICC) (1339 HK) is coming up "cheap" after fully correcting last years' narrowing.
Preceding my comments on Intouch and PICC, are the weekly setup/unwind tables for Asia-Pacific Holdcos.



These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: Reverse Intouch's Stub; (Potentially) Set Up PICC (1339 HK)'s

Thematic (Sector/Industry)

<div>
<p>This revised guide is part of a series of M&amp;A guides that our Quiddity* team (see our profiles or the footnote below) are publishing to aid investors in understanding the rules, parameters, possibilities, and processes when companies conduct mergers and acquisitions. </p>
</div>
<div>
<p>The initial guide - <em><a href="https://skr.ma/rTzri" target="_blank" rel="noopener">Quiddity Thailand M&amp;A Guide 2019</a></em> - was published in May 2019. Since that time, there have been some new developments/clarifications, many of which relate to voluntary de-listings. This is an update.</p>
</div>
<div>
<p>These insights are designed to be used as a reference. They are not actionable.</p>
</div>


This revised guide is part of a series of M&amp;A guides that our Quiddity* team (see our profiles or the footnote below) are publishing to aid investors in understanding the rules, parameters, possibilities, and processes when companies conduct mergers and acquisitions. 


The initial guide - Quiddity Thailand M&amp;A Guide 2019 - was published in May 2019. Since that time, there have been some new developments/clarifications, many of which relate to voluntary de-listings. This is an update.


These insights are designed to be used as a reference. They are not actionable.


Thailand

Total Access Communication Public Company Limited provides cellular mobile telephone services under WorldPhone 800 and WorldPhone 1800 brand names throughout Thailand. The Company also sells cellular handsets and other telecommunications equipment through its WorldMedia network of retail stores.

True Corporation PCL is an integrated telecommunications provider. The Company offers a wide range of voice, video, and data services, including dial-up and broadband Internet services, pay television, fixed-line phone, online games, and mobile phone services.

Jasmine International Public Company Limited provides telecommunication services including fixed-telephone lines, wireless network, digital network and internet access services. The Company also distributes telecommunication equipment through its own retail chain stores.

Advanced Info Service Public Company Limited is granted a 25-year concession expiring the year 2015 by the Telephone Organization of Thailand to provide cellular phone services.  The Company provides analog mobile phone services through the Nordic Mobile Telephone (NMT900) network, and digital phone services through the Global Systems for Mobile Communication (GSM) network.

Thaicom PCL operates satellite communication business. The Company operates and provides satellite transponder services. Thaicom also provides Internet, satellite uplink/downlink, and telephone network services.

Symphony Communication PCL provides Internet services. The Company provides Ethernet services throughout the Bangkok Metropolitan areas.

Samart Telcoms Public Company Limited provides satellite communication network services.  The Company's products and services include international video conferencing, Local Area Network (LAN), Wide Area Network (WAN) via satellite links, Electronic Data Interchange (EDI), and high speed corporate internet access.

Digital Telecommunications Infrastructure Fund is a closed-ended fund that owns telecommunications towers and other related passive telecommunications infrastructure for mobile telecommunications services. Digital Telecommunication also owns core fiber optic cable grid and related transmission equipment and an up-country broadband system.

Digital Telecommunications Infrastructure Fund (DIF TB)

Digital Telecommunications Infrastructure Fund

Maxis Berhad operates as a mobile and fixed communication service provider. The Company, through mobile and fiber telecommunications along with IT infrastructure services, offers mobile and fixed data products, voice and SMS services, mobile payment solutions, remote health monitoring, Cloud solutions, and a business directory to businesses and individuals in Malaysia.

PT Indosat Tbk is a telecommunication and information service provider in Indonesia that provides cellular services (prepaid and postpaid), fixed data services or MIDI (Multimedia, Internet & Data Communication) and fixed voice services including fixed wireless access services.

Tele2 AB is a telecommunications company.  The Company offers mobile services, fixed broadband and telephony, data network services and content services. Tele2 operates throughout Europe and EuroAsia.

Turkcell Iletisim Hizmetleri AS (Turkcell) is a converged communication and technology services player with regional assets and globally relevant services. The Company provides mobile and fixed voice, data, television, and other services over its network in Turkey.

MTN Group Limited provides a wide range of communication services. The Company's services include cellular network access and business solutions. MTN Group is a multinational telecommunications group, operating in countries in Africa and the Middle East.

SK Telecom Co., Ltd. is a Korean mobile and telecommunications operator. The Company provides cellular voice, wireless data, and wireless internet services. SK Telecom also offers fixed line services and platform services.

Axiata Group Berhad is a telecommunication company.  The Company's main activities is the establishment, maintenance, and provision of telecommunications and related services.

PLDT Inc. is a telecommunications and digital services provider. The company offers fixed line, wireless, and fiber optic communication technology services in The Philippines.

Philippine Long Distance Telephone (Adr) (PHI US)

Globe Telecom, Inc. provides wireless application protocol services and digital wireless communication services via GSM network. The Company also offers service which allows users access to a wide range of information and services via a user-friendly menu. In addition, Globe  provides wire line voice and data services.

Intouch Holdings Public Company Limited is a holding company that invests in diversified telecommunication and media and advertising businesses.  The Company, through its subsidiaries, provides television broadcasting, cellular phone and wireless services.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Intouch Holdings (INTUCH TB)

GULF Offer for INTUCH: Index Implications

GULF has made a conditional voluntary tender offer for shares in INTUCH that it does not hold at THB 65/share. KCE could enter the SET50 index at...

Brian Freitas

Intouch’s Conditional Voluntary Tender Offer from Gulf Energy

Gulf Energy announced a conditional voluntary tender offer to acquire all of Intouch shares for THB65.00 cash per share. Overall, we think the...

Arun George

Intouch Holdings: Gulf's Inexplicable Offer

I don't get the logic behind the Offer. Still, this looks done. Trading at a 4.4%/11.2% gross/annualised spread, assuming five months to complete....

David Blennerhassett

StubWorld: Reverse Intouch's Stub; (Potentially) Set Up PICC (1339 HK)'s

Intouch Holdings (INTUCH TB)'s long-term discount to NAV and the simple ratio (Intouch over Advanced Info Service (ADVANC TB)) are at all-time...

David Blennerhassett

Quiddity M&A Guide 2021: Thailand

This revised guide is part of a series of M&A guides to aid investors in understanding the rules, parameters, possibilities, and processes when...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)