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.

Event-Driven

<ul>
<li>The <a href="https://www.smartkarma.com/entities/axiata-group-berhad" target="_blank" data-smartkarma-citation="entities:944:1" rel="noopener">Axiata Group (AXIATA MK)</a> EGM narrowly approved the ordinary resolution relating to the proposed acquisition of <a href="https://www.smartkarma.com/entities/link-net-tbk-pt" target="_blank" data-smartkarma-citation="entities:1050:1" rel="noopener">Link Net (LINK IJ)</a> shares and the proposed MTO. </li>
<li>The next catalyst is the <a href="https://www.smartkarma.com/entities/first-media-tbk-pt" target="_blank" data-smartkarma-citation="entities:11826:1" rel="noopener">First Media (KBLV IJ)</a>’s EGM to approve the transaction on 6 June. The proposed MTO at IDR4,800 per share is targeted to complete by 3Q. </li>
<li>BNM regulatory approval was received on 12 April. At the last close, the gross and annualised spread of the MTO price for a 3Q completion is 4.6% and 13.1%, respectively.</li>
</ul>


The Axiata Group (AXIATA MK) EGM narrowly approved the ordinary resolution relating to the proposed acquisition of Link Net (LINK IJ) shares and the proposed MTO. 
The next catalyst is the First Media (KBLV IJ)’s EGM to approve the transaction on 6 June. The proposed MTO at IDR4,800 per share is targeted to complete by 3Q. 
BNM regulatory approval was received on 12 April. At the last close, the gross and annualised spread of the MTO price for a 3Q completion is 4.6% and 13.1%, respectively.


Axiata Gains Approval for the Link Net MTO; Next up Is First Media’s EGM on 6 June

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Converge Information and Commu / Equity Capital Markets

<ul>
<li>Warburg Pincus, aims to raise around US$138m via selling its 3.6% in Converge ICT (CICT). The sale will be accompanied by a company buyback and a private transaction.</li>
<li>Warburg had earlier sold in the IPO and then in Nov 21, and this trade will be a cleanup.</li>
<li>In this note, we will run the deal through our ECM framework.</li>
</ul>


Warburg Pincus, aims to raise around US$138m via selling its 3.6% in Converge ICT (CICT). The sale will be accompanied by a company buyback and a private transaction.
Warburg had earlier sold in the IPO and then in Nov 21, and this trade will be a cleanup.
In this note, we will run the deal through our ECM framework.


Converge ICT Placement - Clean-Up and Buyback, Just in Time for the Index Inclusion

<ul>
<li>
<a href="https://www.bloomberg.com/news/articles/2022-05-18/hong-kong-telco-hkbn-said-to-draw-interest-from-stonepeak-pag" target="_blank" rel="noopener">Bloomberg reported</a><a href="https://www.smartkarma.com/entities/kkr-co-inc" target="_blank" data-smartkarma-citation="entities:27333:1" rel="noopener">KKR &amp; Co Inc (KKR US)</a> and PAG are carrying out due diligence on <a href="https://www.smartkarma.com/entities/hkbn-ltd" target="_blank" data-smartkarma-citation="entities:289:1" rel="noopener">HKBN Ltd (1310 HK)</a>, with a view to launching a privatisation bid.</li>
<li>HKBN has a relatively concentrated shareholder register which suggests a requirement for a high takeover premium.</li>
<li>Precedent transactions suggest a privatisation forward EV/EBITDA multiple of at least 10x, implying a minimum offer price of HK$11.80 per share, a 23% premium to the last close. </li>
</ul>



Bloomberg reportedKKR &amp; Co Inc (KKR US) and PAG are carrying out due diligence on HKBN Ltd (1310 HK), with a view to launching a privatisation bid.
HKBN has a relatively concentrated shareholder register which suggests a requirement for a high takeover premium.
Precedent transactions suggest a privatisation forward EV/EBITDA multiple of at least 10x, implying a minimum offer price of HK$11.80 per share, a 23% premium to the last close. 


<ul>
<li>At the last close prices, <a href="https://www.smartkarma.com/entities/total-access-communication" target="_blank" data-smartkarma-citation="entities:948:1" rel="noopener">Total Access Communication (DTAC TB)</a> and <a href="https://www.smartkarma.com/entities/true-corp-pcl" target="_blank" data-smartkarma-citation="entities:8:1" rel="noopener">True Corp Pcl (TRUE TB)</a>’s gross spread to the dividend-adjusted VTO price is 5.6% and 11.1%, respectively.  </li>
<li>The merger has received DTAC and True shareholder approvals. The merger hinges on regulatory approval.</li>
<li>The LONG True and SHORT DTAC trade is attractive, with the current spread of 5.5% trading above the average spread since the merger announcement of 3.4% (ex. transaction costs).</li>
</ul>


At the last close prices, Total Access Communication (DTAC TB) and True Corp Pcl (TRUE TB)’s gross spread to the dividend-adjusted VTO price is 5.6% and 11.1%, respectively.  
The merger has received DTAC and True shareholder approvals. The merger hinges on regulatory approval.
The LONG True and SHORT DTAC trade is attractive, with the current spread of 5.5% trading above the average spread since the merger announcement of 3.4% (ex. transaction costs).


<ul>
<li>The <a href="https://www.smartkarma.com/entities/axiata-group-berhad" target="_blank" data-smartkarma-citation="entities:944:1" rel="noopener">Axiata Group (AXIATA MK)</a> EGM to approve the ordinary resolution relating to the proposed acquisition of <a href="https://www.smartkarma.com/entities/link-net-tbk-pt" target="_blank" data-smartkarma-citation="entities:1050:1" rel="noopener">Link Net (LINK IJ)</a> shares and the proposed MTO is on 26 May. </li>
<li>The proposed acquisition is targeted to be complete by 2Q and the subsequent MTO at IDR4,800 per share will complete by 3Q.</li>
<li>At the last close, the gross and annualised spread to the MTO price for a 3Q completion is 7.1% and 11.7%, respectively.</li>
</ul>


The Axiata Group (AXIATA MK) EGM to approve the ordinary resolution relating to the proposed acquisition of Link Net (LINK IJ) shares and the proposed MTO is on 26 May. 
The proposed acquisition is targeted to be complete by 2Q and the subsequent MTO at IDR4,800 per share will complete by 3Q.
At the last close, the gross and annualised spread to the MTO price for a 3Q completion is 7.1% and 11.7%, respectively.


Axiata’s EGM in Relation to the Link Net MTO Set for 26 May

Philippines

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.

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

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.

Safaricom PLC provides telecommunication services. The Company offers wireless solutions. Safaricom serves customers in Kenya.

Airtel Africa PLC provides telecommunication services. The Company offers postpaid and prepaid plans, transfer of credit, conference call, mobile Internet, messaging, voicemail, and roaming facilities. Airtel Africa serves customers worldwide.

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.

United States Cellular Corporation provides wireless telecommunications services. The Company offers its customers various national plans with voice, messaging, and data usage options, along with an array of smartphones, tablets, and other wireless devices. United States Cellular caters to customers throughout the United States.

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.

Freenet AG provides internet and telecommunications services in Germany. The company offers mobile and fixed line telephone, internet access services, information and news services, its own internet catalog, DINO-Online, e-mail accounts, e-commerce services and and set-up of homepages. Through its subsidiary mobilcom is also the franchiser of the MobilCom retail shops.

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.

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PLDT (TEL PM)

Axiata Gains Approval for the Link Net MTO; Next up Is First Media’s EGM on 6 June

The MTO was narrowly approved at the Axiata EGM. The next catalyst is the First Media EGM on 6 June. At the last close, the annualised spread of...

Arun George

Converge ICT Placement - Clean-Up and Buyback, Just in Time for the Index Inclusion

Warburg Pincus, aims to raise around US$138m via selling its 3.6% in Converge ICT (CICT). The sale will be accompanied by a company buyback and a...

Sumeet Singh

HKBN in the Crosshairs of KKR and PAG

Bloomberg reported that KKR and PAG could launch a privatisation bid. Precedent transactions suggest a privatisation forward EV/EBITDA multiple of...

Arun George

DTAC/True Merger VTO Risk/Reward

The DTAC/True merger hinges on regulatory approval. The LONG True and SHORT DTAC trade is attractive, with the current spread to the div-adjusted...

Arun George

Axiata’s EGM in Relation to the Link Net MTO Set for 26 May

The proposed MTO at IDR4,800 per share will complete by 3Q. At the last close, the annualised spread to the MTO price for a 3Q completion is 11.7%.

Arun George

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