Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

The Asia HY Trade Book for the month of September includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index.

  The Asia HY Trade Book for the month of September includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index. 

Asia HY Trade Book - September 2021 - Lucror Analytics

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

China Logistics Property Holdings / Event-Driven

<div>
<a href="https://www.smartkarma.com/entities/china-logistics-property-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:22799:1" rel="noopener">China Logistics Property Holdings (1589 HK)</a> (CLPH) has <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0903/2021090300814.pdf" target="_blank" rel="noopener">announced</a> its chairman, Li Shifa, has entered into an S&amp;P Agreement with <a href="https://www.smartkarma.com/entities/jd-com-inc" target="_blank" data-smartkarma-citation="entities:29043:1" rel="noopener">JD.com Inc. (9618 HK)</a>, to sell his 26.38% stake in CLPH at a price of $4.35/share.
Provided conditions to the S&amp;P are fulfilled, and with JD.com currently holding 10.64%, it would be obligated to make a Mandatory General Offer (MGO) - also at HK$4.35/share.
The key S&amp;P condition is approval from China's AML (Anti-Monopoly Law) Authority.
The key condition to the MGO becoming unconditional is JD.com holding 50% of the voting rights in CLPH. RRJ Capital, Joy Orient, and Dajia Baoxian have given irrevocables to tender in their 21.94%, 3.3%, and 4.14% respective stakes.
This all looks pretty clean.
The pushback is that when CLPH <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/1229/2020122901322.pdf" target="_blank" rel="noopener">announced</a> on the 29 December 2020 Li and RRJ Capital were "conducting a preliminary strategic review of their stakes", indicating a possible change of control for the company, the pre-announcement share price was HK$3.90. Therefore the Offer Price is an 11.5% premium to the undisturbed price. Many investors thought a $4.50+ handle was more in keeping with this space which has been garnering significant attention.
The Offer price will not be increased. 
Still, as one reader put it, they're just happy to get this slow-burning deal off their books.
More below the fold.
</div>


China Logistics Property Holdings (1589 HK) (CLPH) has announced its chairman, Li Shifa, has entered into an S&amp;P Agreement with JD.com Inc. (9618 HK), to sell his 26.38% stake in CLPH at a price of $4.35/share.
Provided conditions to the S&amp;P are fulfilled, and with JD.com currently holding 10.64%, it would be obligated to make a Mandatory General Offer (MGO) - also at HK$4.35/share.
The key S&amp;P condition is approval from China's AML (Anti-Monopoly Law) Authority.
The key condition to the MGO becoming unconditional is JD.com holding 50% of the voting rights in CLPH. RRJ Capital, Joy Orient, and Dajia Baoxian have given irrevocables to tender in their 21.94%, 3.3%, and 4.14% respective stakes.
This all looks pretty clean.
The pushback is that when CLPH announced on the 29 December 2020 Li and RRJ Capital were "conducting a preliminary strategic review of their stakes", indicating a possible change of control for the company, the pre-announcement share price was HK$3.90. Therefore the Offer Price is an 11.5% premium to the undisturbed price. Many investors thought a $4.50+ handle was more in keeping with this space which has been garnering significant attention.
The Offer price will not be increased. 
Still, as one reader put it, they're just happy to get this slow-burning deal off their books.
More below the fold.


China Logistics (1589 HK): JD.com's Offer Comes Up Short

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.

<a href="https://www.smartkarma.com/entities/china-logistics-property-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:22799:1" rel="noopener">China Logistics Property Holdings (1589 HK)</a>/CNLP is a leading provider of premium logistics facilities in China. As of 30 June 2021, CNLP had 179 logistics facilities in operation in 38 logistics parks located in logistics hubs in 19 provinces or centrally administered municipalities. As discussed in <a href="https://www.smartkarma.com/insights/china-logistics-property-s-potential-mgo-from-jd-com" target="_blank" data-smartkarma-citation="insights:56740" rel="noopener">China Logistics Property’s Potential MGO from JD.com</a>, CNLP announced on 26 August that Mr Li Shifa, the founder and the Chairman, is in discussions with a potential purchaser to sell his 26.38% stake in CNLP. If the transaction is completed, it may lead to a change in control and a mandatory general offer (MGO) under Rule 26.1 of the Takeovers Code. The announcement was in response to a Bloomberg article that claimed that <a href="https://www.smartkarma.com/entities/jd-com-inc-adr" target="_blank" data-smartkarma-citation="entities:446:1" rel="noopener">JD.com Inc (ADR) (JD US)</a> is in discussions to purchase Mr Li Shifa along with RRJ Capital’s stake in CNLP at a valuation of about $2 billion (implies a price of HK$4.48 per share). Today, CNLP announced that Mr Li Shifa entered into a sale and purchase agreement with JD Property Group Corporation (owned 83.89% by JD.com) to sell his 26.38% stake in CNLP. The purchase price is HK$4.35 per sale share, a 17.25% premium to the unaffected share price of HK$3.71 (25 August). The completion of the sale and purchase agreement will result in the offeror owning 37.02% of the outstanding shares, which will trigger a mandatory share offer under Rule 26.1 of the Takeovers Code. The sale and purchase agreement is subject to various conditions including regulatory approval (AML authority). Regulatory approval which is expected within six months should be forthcoming as the transaction is unlikely to raise market concentration issues.<div class="content-highlight">The mandatory share offer is conditional on the offeror and parties acting in concert with it holding more than 50% of the voting rights. The offeror has received irrevocables which represent 29.38% of the outstanding shares. Consequently, the 50%+ voting threshold will be satisfied due to the irrevocables. At the last close price of HK$4.05, the gross spread to the MGO price of HK$4.35 per is 7.4%. </div>

China Logistics Property Holdings (1589 HK)/CNLP is a leading provider of premium logistics facilities in China. As of 30 June 2021, CNLP had 179 logistics facilities in operation in 38 logistics parks located in logistics hubs in 19 provinces or centrally administered municipalities. As discussed in China Logistics Property’s Potential MGO from JD.com, CNLP announced on 26 August that Mr Li Shifa, the founder and the Chairman, is in discussions with a potential purchaser to sell his 26.38% stake in CNLP. If the transaction is completed, it may lead to a change in control and a mandatory general offer (MGO) under Rule 26.1 of the Takeovers Code. The announcement was in response to a Bloomberg article that claimed that JD.com Inc (ADR) (JD US) is in discussions to purchase Mr Li Shifa along with RRJ Capital’s stake in CNLP at a valuation of about $2 billion (implies a price of HK$4.48 per share). Today, CNLP announced that Mr Li Shifa entered into a sale and purchase agreement with JD Property Group Corporation (owned 83.89% by JD.com) to sell his 26.38% stake in CNLP. The purchase price is HK$4.35 per sale share, a 17.25% premium to the unaffected share price of HK$3.71 (25 August). The completion of the sale and purchase agreement will result in the offeror owning 37.02% of the outstanding shares, which will trigger a mandatory share offer under Rule 26.1 of the Takeovers Code. The sale and purchase agreement is subject to various conditions including regulatory approval (AML authority). Regulatory approval which is expected within six months should be forthcoming as the transaction is unlikely to raise market concentration issues.The mandatory share offer is conditional on the offeror and parties acting in concert with it holding more than 50% of the voting rights. The offeror has received irrevocables which represent 29.38% of the outstanding shares. Consequently, the 50%+ voting threshold will be satisfied due to the irrevocables. At the last close price of HK$4.05, the gross spread to the MGO price of HK$4.35 per is 7.4%. 

China Logistics Property’s Mandatory Conditional Offer Set in Motion

In this month’s "In-Focus" section, we discuss variable interest entities (VIEs) in China, including recent developments in China and the US that may complicate the future use of VIEs. We also give an overview of recent bond defaults. The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the "In-Focus" section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

  In this month’s "In-Focus" section, we discuss variable interest entities (VIEs) in China, including recent developments in China and the US that may complicate the future use of VIEs. We also give an overview of recent bond defaults.   The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the "In-Focus" section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market. 

Asia HY Monthly - Chinese Variable Interest Entities - Lucror Analytics

China

China Logistics Property Holdings Co Ltd is a logistic facility provider in China. 

China Logistics Property Holdings (1589 HK)

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China Logistics Property Holdings (1589 HK)

Asia HY Trade Book - September 2021 - Lucror Analytics

The Asia HY Trade Book for the month of September includes a summary of our recommendations, as well as our high-conviction ideas. The report...

Lucror Analytics

Asia HY Trade Book - September 2021 - Lucror Analytics

The Asia HY Trade Book for the month of September includes a summary of our recommendations, as well as our high-conviction ideas. The report...

Lucror Analytics

China Logistics (1589 HK): JD.com's Offer Comes Up Short

The price is widely viewed as a disappointment. But this should trade relatively tight to terms - perhaps around HK$4.25, or 2.4%/16.0% gross...

David Blennerhassett

China Logistics Property’s Mandatory Conditional Offer Set in Motion

The MGO will be meet the 50%+ voting threshold due to irrevocables. At the last close price of HK$4.05, the gross spread to the MGO price of...

Arun George

Asia HY Monthly - Chinese Variable Interest Entities - Lucror Analytics

In this month’s "In-Focus" section, we discuss variable interest entities (VIEs) in China, including recent developments in China and the US that...

Lucror Analytics

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)