Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>There are currently 47 - mostly firm - transactions currently being discussed and analysed on Smartkarma.</li>
<li>Three new deals were discussed this week: <a href="https://www.smartkarma.com/entities/guodian-technology-environment-group-corp" target="_blank" data-smartkarma-citation="entities:3941:1" rel="noopener">Guodian Technology &amp; Environment Group (1296 HK)</a>, <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>, and <a href="https://www.smartkarma.com/entities/g-j-steel-pcl" target="_blank" data-smartkarma-citation="entities:14759:1" rel="noopener">G J Steel PCL (GJS TB)</a>.</li>
<li>Keys updates took place for: <a href="https://www.smartkarma.com/entities/over-the-wire-holdings-ltd" target="_blank" data-smartkarma-citation="entities:30653:1" rel="noopener">Over the Wire Holdings Ltd (OTW AU)</a>, <a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer Inc (1337 HK)</a>, <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>, <a href="https://www.smartkarma.com/entities/akm-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:7206:1" rel="noopener">AKM Industrial (1639 HK)</a>, and <a href="https://www.smartkarma.com/entities/ara-logos-logistics-trust" target="_blank" data-smartkarma-citation="entities:937:1" rel="noopener">ARA LOGOS (ALLT SP)</a>.</li>
</ul>


There are currently 47 - mostly firm - transactions currently being discussed and analysed on Smartkarma.
Three new deals were discussed this week: Guodian Technology &amp; Environment Group (1296 HK), Link Net (LINK IJ), and G J Steel PCL (GJS TB).
Keys updates took place for: Over the Wire Holdings Ltd (OTW AU), Razer Inc (1337 HK), China Logistics Property Holdings (1589 HK), AKM Industrial (1639 HK), and ARA LOGOS (ALLT SP).


Asia-Pac Weekly Risk Arb Summary: Razer, Link Net, ARA LOGOS, Guodian Tech, GJ Steel

<ul>
<li>530.8mn shares of <a href="https://www.smartkarma.com/entities/ausnutria-dairy-corp-ltd" target="_blank" data-smartkarma-citation="entities:13799:1" rel="noopener">Ausnutria (1717 HK)</a> crossed at the close yesterday at HK$10.06/share. That is the exact number of shares under the SPAs and the stated price under the agreements.</li>
<li>China's NDRC approval,  a condition to the SPAs, was obtained earlier this month, leaving MoC and SAFE approvals outstanding. They appear to have been received. </li>
<li>Expect confirmation shortly. The completion of the SPAs triggers an MGO, which is conditional on <a href="https://www.smartkarma.com/entities/inner-mongolia-yili-indus-a" target="_blank" data-smartkarma-citation="entities:3220:1" rel="noopener">Inner Mongolia Yili Industrial Group (600887 CH)</a> holding 50% of the voting rights.  </li>
</ul>


530.8mn shares of Ausnutria (1717 HK) crossed at the close yesterday at HK$10.06/share. That is the exact number of shares under the SPAs and the stated price under the agreements.
China's NDRC approval,  a condition to the SPAs, was obtained earlier this month, leaving MoC and SAFE approvals outstanding. They appear to have been received. 
Expect confirmation shortly. The completion of the SPAs triggers an MGO, which is conditional on Inner Mongolia Yili Industrial Group (600887 CH) holding 50% of the voting rights.  


Ausnutria (1717 HK): SPAs Done (Just Not Officially)

China Infrastructure & Logistics Group  / Event-Driven

<ul>
<li>After shares were <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1230/2021123000278.pdf" target="_blank" rel="noopener">halted</a> midday on the 30 December pursuant to the Takeovers Code, <a href="https://www.smartkarma.com/entities/china-infrastructure-logis" target="_blank" data-smartkarma-citation="entities:16710:1" rel="noopener">China Infrastructure &amp; Logistics Group (1719 HK)</a> ("CILG") has <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0110/2022011001152.pdf" target="_blank" rel="noopener">announced</a> a possible MGO from Hubei Ports.</li>
<li>Hubei Ports has entered into a SPA with co-chairman Yan Zhi to acquire his 74.81% stake in CILG. Upon completion, this will trigger an unconditional MGO. The price is HK$1.15/share.</li>
<li>A key condition to the SPA is approval from SASAC of Wuhan, which is turn controls 82.8571% of Hubei Ports. This transaction is done.</li>
</ul>


After shares were halted midday on the 30 December pursuant to the Takeovers Code, China Infrastructure &amp; Logistics Group (1719 HK) ("CILG") has announced a possible MGO from Hubei Ports.
Hubei Ports has entered into a SPA with co-chairman Yan Zhi to acquire his 74.81% stake in CILG. Upon completion, this will trigger an unconditional MGO. The price is HK$1.15/share.
A key condition to the SPA is approval from SASAC of Wuhan, which is turn controls 82.8571% of Hubei Ports. This transaction is done.


China Infrastructure & Logistics Group (1719 HK): Potential Unconditional MGO

<ul>
<li>China's NDRC approval, a key condition to the Share Purchase Agreement, has been obtained.  SAMR clearance had previously been fulfilled, leaving MoC and SAFE approvals yet to be secured.</li>
<li>The turnout at <a href="https://www.smartkarma.com/entities/ausnutria-dairy-corp-ltd" target="_blank" data-smartkarma-citation="entities:13799:1" rel="noopener">Ausnutria Dairy Corp (1717 HK)</a>'s recent EGM would suggest there is a sufficient number of shares for the MGO to turn unconditional. </li>
<li>Provided the Offer becomes unconditional, trading at a gross/annualised spread of 4.4%/22.1%, assuming late 1Q22 completion.</li>
</ul>


China's NDRC approval, a key condition to the Share Purchase Agreement, has been obtained.  SAMR clearance had previously been fulfilled, leaving MoC and SAFE approvals yet to be secured.
The turnout at Ausnutria Dairy Corp (1717 HK)'s recent EGM would suggest there is a sufficient number of shares for the MGO to turn unconditional. 
Provided the Offer becomes unconditional, trading at a gross/annualised spread of 4.4%/22.1%, assuming late 1Q22 completion.


Ausnutria (1717 HK): MGO Imminent As NDRC Approval Obtained

NTT (Nippon Telegraph & Telephone) / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (9432 JP)</a> sees a US$1bn selldown of shares on 29 December, due to a weird quirk in the way TOPIX and JPX Nikkei 400 are constructed and managed.</li>
<li>China's State Administration for Market Supervision is reviewing <a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer (1337 HK)</a>'s privatisation as a simple case. With the key regulatory pre-condition all but satisfied, the Scheme timeline will significantly shorten. </li>
<li>The trade is to be long the back end of <a href="https://www.smartkarma.com/entities/shinsei-bank-ltd" target="_blank" data-smartkarma-citation="entities:16897:1" rel="noopener">Shinsei Bank (8303 JP)</a>'s Tender Offer. BUY Shinsei Bank shares - outright, and vs large Japanese banks with higher PBRs. </li>
</ul>



NTT (9432 JP) sees a US$1bn selldown of shares on 29 December, due to a weird quirk in the way TOPIX and JPX Nikkei 400 are constructed and managed.
China's State Administration for Market Supervision is reviewing Razer (1337 HK)'s privatisation as a simple case. With the key regulatory pre-condition all but satisfied, the Scheme timeline will significantly shorten. 
The trade is to be long the back end of Shinsei Bank (8303 JP)'s Tender Offer. BUY Shinsei Bank shares - outright, and vs large Japanese banks with higher PBRs. 


Last Week in Event SPACE: NTT, Razer, Shinsei Bank, Evergrande, Bank of Kyoto, Nippon Express

China

Ausnutria Dairy Corporation Ltd is a paediatric milk formula company. The Company is engaged in the dairy industry with its production facilities based in the Netherlands. Ausnutria Dairy Corporation markets and sells dairy products to the People's Republic of China, Europe, North America, the Middle East, and other overseas countries.

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Ausnutria Dairy Corp (1717 HK)

Asia-Pac Weekly Risk Arb Summary: Razer, Link Net, ARA LOGOS, Guodian Tech, GJ Steel

This insight provides a summary of gross/annualised spreads (on deals discussed on Smartkarma) across Asia-Pacific as at the last trading date, and...

David Blennerhassett

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That spread is okay. You still need the MGO turns unconditional. In any event, I would expect a back-end re-rate following the completion of the...

David Blennerhassett

China Infrastructure & Logistics Group (1719 HK): Potential Unconditional MGO

At HK$1.13/share, CLIG is trading at a gross/annualised spread of 1.8%/6.7%, assuming late April completion. That's okay, but I'd look to enter a...

David Blennerhassett

Ausnutria (1717 HK): MGO Imminent As NDRC Approval Obtained

At HK$9.64/share, Ausnutria is currently trading at a gross/annualised spread of 4.4%/22.1%, assuming late 1Q22 completion. That still looks...

David Blennerhassett

Last Week in Event SPACE: NTT, Razer, Shinsei Bank, Evergrande, Bank of Kyoto, Nippon Express

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

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