Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Yorkey Optical International Cayman / Event-Driven

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<p>After <a href="https://www.smartkarma.com/entities/yorkey-optical-intl-cayman" target="_blank" data-smartkarma-citation="entities:12407:1" rel="noopener">Yorkey Optical Intl Cayman (2788 HK)</a>, an optical and opto-electronic products manufacturer, <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1015/2021101501288.pdf" target="_blank" rel="noopener">announced</a> an Offer, by way of a Scheme, from <a href="https://www.smartkarma.com/entities/asia-optical-co-inc" target="_blank" data-smartkarma-citation="entities:11214:1" rel="noopener">Asia Optical Co (3019 TT)</a> at $0.88/share - a price that had not been declared final - the salient question attached to this transaction was what would activist investor David Webb, holding at least <a href="https://di.hkex.com.hk/di/NSNoticeSSList.aspx?sa2=ns&amp;sid=9800&amp;corpn=Yorkey+Optical+International+(Cayman)+Ltd.&amp;sd=16/10/2016&amp;ed=16/10/2021&amp;cid=0&amp;sa1=cl&amp;scsd=16%2f10%2f2016&amp;sced=16%2f10%2f2021&amp;sc=2788&amp;src=MAIN&amp;lang=EN&amp;g_lang=en&amp;" target="_blank" rel="noopener">5.01%</a>, do?</p>
<p>He has been <a href="https://webb-site.com/dbpub/articles.asp?p=32013" target="_blank" rel="noopener">critical</a> in the past of Yorkey's large cash pile and its reluctance to distribute the surplus cash. Webb is also deputy chairman of Hong Kong's Takeovers and Mergers Panel <em>and</em> the Takeovers Appeal Committee, so he's aware of the games people can play.</p>
<p>So it should come as no surprise he lifted his holding <a href="https://www.sfc.hk/-/media/Dealing-disclosures/2021/Yorkey-Optical-International/e20211019--table2a--Yorkey-Optical--Webb-David-Michael-20211018-1.pdf" target="_blank" rel="noopener">above 6%</a> on the 18 October, effectively giving him a blocking stake at the Scheme Meeting.</p>
<p>Arguably he is long a put at A$0.88/share. I would argue this now needs a bump from Asia Optical otherwise it’s a non-starter. </p>
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After Yorkey Optical Intl Cayman (2788 HK), an optical and opto-electronic products manufacturer, announced an Offer, by way of a Scheme, from Asia Optical Co (3019 TT) at $0.88/share - a price that had not been declared final - the salient question attached to this transaction was what would activist investor David Webb, holding at least 5.01%, do?
He has been critical in the past of Yorkey's large cash pile and its reluctance to distribute the surplus cash. Webb is also deputy chairman of Hong Kong's Takeovers and Mergers Panel and the Takeovers Appeal Committee, so he's aware of the games people can play.
So it should come as no surprise he lifted his holding above 6% on the 18 October, effectively giving him a blocking stake at the Scheme Meeting.
Arguably he is long a put at A$0.88/share. I would argue this now needs a bump from Asia Optical otherwise it’s a non-starter. 


Yorkey Optical (2788 HK): Webb Bumps... Will Asia Optical?

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<p>After being <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1006/2021100600336.pdf" target="_blank" rel="noopener">suspended</a> on the 6 October pursuant to the Hong Kong Code on Takeovers and Mergers, <a href="https://www.smartkarma.com/entities/yorkey-optical-intl-cayman" target="_blank" data-smartkarma-citation="entities:12407:1" rel="noopener">Yorkey Optical Intl Cayman (2788 HK)</a>, an optical and opto-electronic products manufacturer, has now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1015/2021101501288.pdf" target="_blank" rel="noopener">announced</a> an Offer, by way of a Scheme, from <a href="https://www.smartkarma.com/entities/asia-optical-co-inc" target="_blank" data-smartkarma-citation="entities:11214:1" rel="noopener">Asia Optical Co (3019 TT)</a>, Yorkey's largest shareholder.</p>
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<p>The consideration is $0.88/share, a 54.4% premium to last close - and shares gained 14% on Friday.  <strong>The Offer Price has not been declared final</strong>. No dividends are expected to be declared during the Offer period. </p>
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<p>Asia Optical holds 27.79% (directly &amp; indirectly) of shares out, and with connected parties, 41.63%.  Disinterested shareholders comprise 58.37% of shares out, therefore the blocking stake at the forthcoming Court Meeting is 5.837% of shares out. </p>
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<p>The headcount test applies.</p>
<p>Activist investor David Webb holding at least <a href="https://di.hkex.com.hk/di/NSNoticeSSList.aspx?sa2=ns&amp;sid=9800&amp;corpn=Yorkey+Optical+International+(Cayman)+Ltd.&amp;sd=16/10/2016&amp;ed=16/10/2021&amp;cid=0&amp;sa1=cl&amp;scsd=16%2f10%2f2016&amp;sced=16%2f10%2f2021&amp;sc=2788&amp;src=MAIN&amp;lang=EN&amp;g_lang=en&amp;" target="_blank" rel="noopener">5.01%</a>,  has been <a href="https://webb-site.com/dbpub/articles.asp?p=32013" target="_blank" rel="noopener">consistently vocal</a> about Yorkey's large net cash position, and demanding a distribution of the surplus cash.</p>
<p>Yorkey's net cash was US$81.8mn (HK$638mn) as at 30 June 2021, or HK$0.78/share. </p>
<p>Net profit in the 1H21 was US$0.794mn (HK$6.2mn) or HK$12.3mn if extrapolated out for the full year. Therefore Asia Optical is effectively taking out the company at ~6.6x PER FY21E, excluding the net cash position. </p>
<p>This will be a close-run thing. Plus Yorkey is illiquid and Hong Kong takeovers have had a torrid time of late. </p>
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<div>More below the fold.</div>
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<p></p>
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After being suspended on the 6 October pursuant to the Hong Kong Code on Takeovers and Mergers, Yorkey Optical Intl Cayman (2788 HK), an optical and opto-electronic products manufacturer, has now announced an Offer, by way of a Scheme, from Asia Optical Co (3019 TT), Yorkey's largest shareholder.


The consideration is $0.88/share, a 54.4% premium to last close - and shares gained 14% on Friday.  The Offer Price has not been declared final. No dividends are expected to be declared during the Offer period. 


Asia Optical holds 27.79% (directly &amp; indirectly) of shares out, and with connected parties, 41.63%.  Disinterested shareholders comprise 58.37% of shares out, therefore the blocking stake at the forthcoming Court Meeting is 5.837% of shares out. 


The headcount test applies.
Activist investor David Webb holding at least 5.01%,  has been consistently vocal about Yorkey's large net cash position, and demanding a distribution of the surplus cash.
Yorkey's net cash was US$81.8mn (HK$638mn) as at 30 June 2021, or HK$0.78/share. 
Net profit in the 1H21 was US$0.794mn (HK$6.2mn) or HK$12.3mn if extrapolated out for the full year. Therefore Asia Optical is effectively taking out the company at ~6.6x PER FY21E, excluding the net cash position. 
This will be a close-run thing. Plus Yorkey is illiquid and Hong Kong takeovers have had a torrid time of late. 

More below the fold.




Yorkey Optical (2788 HK)'s Scheme: What Will Webb Do?

Asia and Global Semiconductor and Tech Research

Andrew Lu

Equity Bottom-Up

<h2>What's new?</h2><p>According to <a href="https://www.smartkarma.com/entities/20279" target="_blank" data-smartkarma-citation="entities:20279:1">Tesla Motors Inc (TSLA US)</a>'s press release yesterday, Tesla delivered 26,150 vehicles in 3Q17, up 19% q/q and up 5% y/y (14,065 were Model S, up 17% q/q but down 12% y/y, and 11,865 were Model X, up 18% q/q and 35% y/y, 220 were Model 3). Tesla now expects 2H Model S/X deliveries to exceed that by several thousand vehicles than 1H's 47,077 with a total about 100,000 Model S/X in 2017 or 31% y/y increase.</p><p>Q3 production totaled 25,336 vehicles, with 260 of them being Model…</p>

What's new?According to Tesla Motors Inc (TSLA US)'s press release yesterday, Tesla delivered 26,150 vehicles in 3Q17, up 19% q/q and up 5% y/y (14,065 were Model S, up 17% q/q but down 12% y/y, and 11,865 were Model X, up 18% q/q and 35% y/y, 220 were Model 3). Tesla now expects 2H Model S/X deliveries to exceed that by several thousand vehicles than 1H's 47,077 with a total about 100,000 Model S/X in 2017 or 31% y/y increase.Q3 production totaled 25,336 vehicles, with 260 of them being Model…

Tesla - Missed Model 3 Deliveries as Expected; More Value at Its Suppliers than Tesla Itself

Doing bespoke work since 2002....., Custom Products Group

Patrick Hansen

Doing bespoke work since 2002.....

Custom Products Group

Custom Products was started 14 years ago at Lehman Brothers by current co-founder Patrick Hansen, CFA. After 3 years at Lehman, Patrick moved the team to Macquarie Securities where Simon Rigney (co-founder) joined. 3 years ago we took Custom Products independent. 

Our core strength can be summed up three words. 1- Customization - we have very little off the shelf products and most work is done on a one on one bespoke basis. 2- Speed - We pride ourselves in our ability to get requests back to the client very quickly. 3- Confidentiality - We do not redistribute. There is no grace period where we wait a week and then mass blast. Any request stops with that client.

Thematic (Sector/Industry)

<p>We screened for growth names in Asia that have little to no coverage but still trade enough that you could potentially invest. If you can trade A-shares, please contact us because the universe gets a lot bigger if we add A-shares. The two names that top the list were <a href="https://www.smartkarma.com/entities/14905" target="_blank" data-smartkarma-citation="entities:14905:1">Grape King Bio Ltd (1707 TT)</a> and International Games System (3293 TT).</p><h2>Screen Criteria</h2><ol>
<li>Daily Value traded (6M Average) is greater than 5mn USD</li>
<li>Only 1 Analyst or no coverage at all</li>
<li>Positive OP growth 9 out of the last 12 quarters</li>
<li>Median…</li>
</ol>

We screened for growth names in Asia that have little to no coverage but still trade enough that you could potentially invest. If you can trade A-shares, please contact us because the universe gets a lot bigger if we add A-shares. The two names that top the list were Grape King Bio Ltd (1707 TT) and International Games System (3293 TT).Screen Criteria
Daily Value traded (6M Average) is greater than 5mn USD
Only 1 Analyst or no coverage at all
Positive OP growth 9 out of the last 12 quarters
Median…


Growth Names in Asia You Probably Have Not Heard About but Can Invest In....

Taiwan

Asia Optical Co., Inc. manufactures and markets electro-optical products.  The Company's products include optical components, cameras, fax machines, and contact image sensor (CIS) electronic products.  Asia Optical sells its products in Taiwan and exports worldwide.

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Asia Optical Co (3019 TT)

Yorkey Optical (2788 HK): Webb Bumps... Will Asia Optical?

Get involved around here. I don't see Webb picking up pennies ahead of any deal completion. He is holding out for a bump. This may need a $1+ handle.

David Blennerhassett

Yorkey Optical (2788 HK)'s Scheme: What Will Webb Do?

With Webb close to holding a blocking stake, an illiquid arb situation, and the fact Hong Kong events have been somewhat of a disaster this year,...

David Blennerhassett

Tesla - Missed Model 3 Deliveries as Expected; More Value at Its Suppliers than Tesla Itself

What's new?According to Tesla Motors Inc (TSLA US)'s press release yesterday, Tesla delivered 26,150 vehicles in 3Q17, up 19% q/q and up 5% y/y...

Andrew Lu

Growth Names in Asia You Probably Have Not Heard About but Can Invest In....

We screened for growth names in Asia that have little to no coverage but still trade enough that you could potentially invest. If you can trade...

Custom Products Group

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