Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Hyundai Home Shopping Network / Event-Driven

<ul>
<li>Yesterday, the 3rd April, <a href="https://www.smartkarma.com/entities/hyundai-g-f-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:19560:1" rel="noopener">Hyundai G.F. Holdings (005440 KS)</a> <a href="https://n.news.naver.com/mnews/article/030/0003194952" target="_blank" rel="noopener">announced</a> it would conduct a Tender Offer for 3mn shares, or 25% of <a href="https://www.smartkarma.com/entities/hyundai-home-shopping-network-corp" target="_blank" data-smartkarma-citation="entities:2357:1" rel="noopener">Hyundai Home Shopping Network (057050 KS)</a> (HHSN).</li>
<li>A successful Tender would lift Holdings stake to 50% from 25% currently, satisfying the <a href="https://www.businesskorea.co.kr/news/articleView.html?idxno=55003" target="_blank" rel="noopener">30% holding company threshold</a> introduced in 2022.</li>
<li>Minimum proration is 33%. Shares popped 13.8% on the news. That looks a bit too aggressive. </li>
</ul>


Yesterday, the 3rd April, Hyundai G.F. Holdings (005440 KS) announced it would conduct a Tender Offer for 3mn shares, or 25% of Hyundai Home Shopping Network (057050 KS) (HHSN).
A successful Tender would lift Holdings stake to 50% from 25% currently, satisfying the 30% holding company threshold introduced in 2022.
Minimum proration is 33%. Shares popped 13.8% on the news. That looks a bit too aggressive. 


Hyundai Home Shopping (057050 KS)'s Partial Offer

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>On 3 April, it was reported that Hyundai G.F. Holdings will be conducting a tender offer of 3 million shares of Hyundai Home Shopping (25% of outstanding shares). </li>
<li>The tender offer price is 64,200 won. The main reason for this tender offer is to meet the regulatory requirement of a holding company by 2025. </li>
<li>We are positive on the tender offer of a 25% stake in Hyundai Home Shopping by Hyundai G.F. Holdings.</li>
</ul>


On 3 April, it was reported that Hyundai G.F. Holdings will be conducting a tender offer of 3 million shares of Hyundai Home Shopping (25% of outstanding shares). 
The tender offer price is 64,200 won. The main reason for this tender offer is to meet the regulatory requirement of a holding company by 2025. 
We are positive on the tender offer of a 25% stake in Hyundai Home Shopping by Hyundai G.F. Holdings.


Tender Offer of 25% of Hyundai Home Shopping Shares by Hyundai GF Holdings

Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

<ul>
<li>It is somewhat unusual that there is still a spread of over 5%. This likely reflects concerns about the relatively high intensity of allocation risk.</li>
<li>Retail: 30%, Institutions: 16% of float shares (46%). Retailers may contribute 20%, institutions 10-15%. Total tender rate: 30-35%.</li>
<li>In that case, it means that roughly 70% of our holdings could be tendered. And at this level, it seems reasonable enough to target the current spread of 5%.</li>
</ul>


It is somewhat unusual that there is still a spread of over 5%. This likely reflects concerns about the relatively high intensity of allocation risk.
Retail: 30%, Institutions: 16% of float shares (46%). Retailers may contribute 20%, institutions 10-15%. Total tender rate: 30-35%.
In that case, it means that roughly 70% of our holdings could be tendered. And at this level, it seems reasonable enough to target the current spread of 5%.


Estimating Participation Rate for Hyundai HS Tender Offer, Currently at a 5% Spread

<ul>
<li>
This article discusses the potential inclusions and exclusions of KOSPI200 rebalance inDecember 2023 (especially those that are highlighted by the locals). 
</li>
<li>Stocks that are expected to be added to the KOSPI200 index include Posco DX, HD Hyundai Electric, Sam-A Aluminum, TCC Steel, and Dentium. </li>
<li>Stocks that are expected to be excluded in the KOSPI200 index Include Zinus, Handsome, Cuckoo Homesys, Taekwang Industrial, and Hyundai Home Shopping.</li>
</ul>



This article discusses the potential inclusions and exclusions of KOSPI200 rebalance inDecember 2023 (especially those that are highlighted by the locals). 

Stocks that are expected to be added to the KOSPI200 index include Posco DX, HD Hyundai Electric, Sam-A Aluminum, TCC Steel, and Dentium. 
Stocks that are expected to be excluded in the KOSPI200 index Include Zinus, Handsome, Cuckoo Homesys, Taekwang Industrial, and Hyundai Home Shopping.


KOSPI200 Rebalance in December 2023 Highlighted by Locals

<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. 


South Korea

Hyundai Home Shopping Network Corporation  mechandises consumer products. The Company's products include clothes, home appliances, food, and luxuries. Hyundai Home Shopping retails through TV home shoppoing channels, catalogs, and the Inte rnet shopping mall.

Hyundai Home Shopping Network (057050 KS)

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Hyundai Home Shopping Network (057050 KS)

Hyundai Home Shopping (057050 KS)'s Partial Offer

HHSN is not particularly liquid, trading ~US$1mn/day. Unless you believe pro-ration to be materially higher than 65%, I'd be disinclined to enter...

David Blennerhassett

Tender Offer of 25% of Hyundai Home Shopping Shares by Hyundai GF Holdings

We are positive on the tender offer of a 25% stake in Hyundai Home Shopping by Hyundai G.F. Holdings. Hyundai Home Shopping is trading at only 0.3x...

Douglas Kim

Estimating Participation Rate for Hyundai HS Tender Offer, Currently at a 5% Spread

This post assesses the actual tendering participation rate for the Hyundai Home Shopping tender offer, currently at a 5% spread.

Sanghyun Park

KOSPI200 Rebalance in December 2023 Highlighted by Locals

This article discusses the potential inclusions and exclusions of KOSPI200 rebalance in December 2023 (especially those that are highlighted by the...

Douglas Kim

Zhihu (2390 HK/ZH US)'s Cheeky Buyback

This is an interesting, albeit illiquid, Partial Offer. The final pro-ration was ~45% in the partial for Hengdeli, in which the Offer price was...

David Blennerhassett

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