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.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/huitongda" target="_blank" data-smartkarma-citation="entities:33789:1" rel="noopener">Huitongda (1566215D CH)</a> is a fast-growing commerce and service platform focused on China’s lower-tier retail market. It is pre-marketing an HKEx IPO to raise US$400-500 million.</li>
<li>The positives are a large addressable market, solid top-line growth and profitability. The key negative is the low margin profile which reflects a fragmented and competitive market. </li>
<li>Overall, we think that the positives outweigh the negatives and this IPO is worth a closer look.   </li>
</ul>



Huitongda (1566215D CH) is a fast-growing commerce and service platform focused on China’s lower-tier retail market. It is pre-marketing an HKEx IPO to raise US$400-500 million.
The positives are a large addressable market, solid top-line growth and profitability. The key negative is the low margin profile which reflects a fragmented and competitive market. 
Overall, we think that the positives outweigh the negatives and this IPO is worth a closer look.   


Huitongda Network IPO Initiation: Clicks to Bricks

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.

<ul>
<li>Weibo plans to raise around US$470m in its secondary listing in Hong Kong. </li>
<li>We have covered most aspects of the deal in our previous note, <a href="https://www.smartkarma.com/insights/weibo-secondary-listing-needs-to-come-at-a-discount" target="_blank" rel="noopener">Weibo Secondary Offering - Needs to come at a discount</a>.</li>
<li>In this note, we'll talk about the deal pricing and structure.</li>
</ul>


Weibo plans to raise around US$470m in its secondary listing in Hong Kong. 
We have covered most aspects of the deal in our previous note, Weibo Secondary Offering - Needs to come at a discount.
In this note, we'll talk about the deal pricing and structure.


Weibo Secondary Listing - Going Down the Autohome Route

<ul>
<li>Weibo plans to raise around US$500-700m in its secondary listing in Hong Kong. </li>
<li>The company won listing approval and filed its PHIP on last week and will look to launch its secondary offering soon.</li>
<li>In this note, we’ll take a look at the deal and talk about the impact of the raising.</li>
</ul>


Weibo plans to raise around US$500-700m in its secondary listing in Hong Kong. 
The company won listing approval and filed its PHIP on last week and will look to launch its secondary offering soon.
In this note, we’ll take a look at the deal and talk about the impact of the raising.


Weibo Secondary Listing - Needs to Come at a Discount

Event-Driven

iClick Interactive Asia Group / Event-Driven

<a href="https://www.smartkarma.com/entities/iclick-interactive-asia-group-limited" target="_blank" data-smartkarma-citation="entities:27314:1" rel="noopener">iClick Interactive Asia Group (ICLK US)</a> is a leading enterprise and marketing cloud platform in China. It is a platinum provider to <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> in social advertising and provides one-stop solutions in user acquisition and engagement.On 18 September, iClick announced a second non-binding privatisation proposal from Infinity Equity Management. The bid of $7.50 in cash per ADS represents a premium of 32.7% to the undisturbed price of $5.65 (on 23 September prior to the first proposal from PAG and Oasis). As a reminder, on 24 September, iClick announced a non-binding privatisation proposal from PAG and Oasis Management of $6.75 in cash per ADS. Infinity’s offer represents an 11.1% bump to the offer from PAG and Oasis.  As iClick is incorporated in the Cayman Islands, for the privatisation to succeed, shareholders representing two-thirds of shares present and voting need to approve the deal. Infinity has not disclosed a shareholding. iClick’s three largest shareholders are Wing Hong Sammy Hsieh (co-founder and Chairman), Jian Tang (co-founder and CEO) and <a href="https://www.smartkarma.com/entities/baozun-inc" target="_blank" data-smartkarma-citation="entities:24184:1" rel="noopener">Baozun Inc. (BZUN US)</a>. Mr Hsieh and Mr Tang together represent around 62% of voting interests. Borrowing a page from PAG and Oasis’ playbook, Infinity’s letter to the board mentions an intention to acquire all the shares other than those “other than management owned shares and those existing shareholders of the Company who elect to roll over.” The wording suggests that Infinity is vying with PAG and Oasis to get the upper hand in discussions with the co-founders and Baozun. In <a href="https://www.smartkarma.com/insights/iclick-s-privatisation-bid-from-pag-and-oasis" target="_blank" data-smartkarma-citation="insights:58109" rel="noopener">IClick’s Privatisation Bid from PAG and Oasis</a>, we stated that the PAG and Oasis offer is unattractive in comparison to historical share prices and multiples. We also noted that the PAG and Oasis offer is designed to take advantage of the sell-off in Chinese tech names by enriching insiders at the expense of minorities.<div class="content-highlight">While we did not expect a competing bid, Infinity’s offer while providing a bump to PAG and Oasis' offer still leaves minorities short-changed. Nevertheless, the emergence of two bidders suggests that there is a decent chance of another bidding round. At the last close of $6.50 per ADS, the gross spread to the Infinity offer price is 15.4%.  </div>

iClick Interactive Asia Group (ICLK US) is a leading enterprise and marketing cloud platform in China. It is a platinum provider to Tencent (700 HK) in social advertising and provides one-stop solutions in user acquisition and engagement.On 18 September, iClick announced a second non-binding privatisation proposal from Infinity Equity Management. The bid of $7.50 in cash per ADS represents a premium of 32.7% to the undisturbed price of $5.65 (on 23 September prior to the first proposal from PAG and Oasis). As a reminder, on 24 September, iClick announced a non-binding privatisation proposal from PAG and Oasis Management of $6.75 in cash per ADS. Infinity’s offer represents an 11.1% bump to the offer from PAG and Oasis.  As iClick is incorporated in the Cayman Islands, for the privatisation to succeed, shareholders representing two-thirds of shares present and voting need to approve the deal. Infinity has not disclosed a shareholding. iClick’s three largest shareholders are Wing Hong Sammy Hsieh (co-founder and Chairman), Jian Tang (co-founder and CEO) and Baozun Inc. (BZUN US). Mr Hsieh and Mr Tang together represent around 62% of voting interests. Borrowing a page from PAG and Oasis’ playbook, Infinity’s letter to the board mentions an intention to acquire all the shares other than those “other than management owned shares and those existing shareholders of the Company who elect to roll over.” The wording suggests that Infinity is vying with PAG and Oasis to get the upper hand in discussions with the co-founders and Baozun. In IClick’s Privatisation Bid from PAG and Oasis, we stated that the PAG and Oasis offer is unattractive in comparison to historical share prices and multiples. We also noted that the PAG and Oasis offer is designed to take advantage of the sell-off in Chinese tech names by enriching insiders at the expense of minorities.While we did not expect a competing bid, Infinity’s offer while providing a bump to PAG and Oasis' offer still leaves minorities short-changed. Nevertheless, the emergence of two bidders suggests that there is a decent chance of another bidding round. At the last close of $6.50 per ADS, the gross spread to the Infinity offer price is 15.4%.  

IClick’s Improved Privatisation Bid from a Second Suitor

<a href="https://www.smartkarma.com/entities/iclick-interactive-asia-group-limited" target="_blank" data-smartkarma-citation="entities:27314:1" rel="noopener">iClick Interactive Asia Group (ICLK US)</a> is a leading enterprise and marketing cloud platform in China. It is a platinum provider to <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> in social advertising and provides one-stop solutions in user acquisition and engagement. iClick was listed on Nasdaq in December 2017 at $8.00 per ADS and raised net proceeds of $23.3 million.  On 24 September, iClick announced a non-binding privatisation proposal from PAG and Oasis Management. The bid of $6.75 in cash per ADS represents a premium of 19.5% to the undisturbed price (on 23 September). As iClick is incorporated in the Cayman Islands, for the privatisation to succeed, shareholders representing two-thirds of shares present and voting need to approve the deal. PAG and Oasis have not disclosed a shareholding. iClick’s three largest shareholders are Wing Hong Sammy Hsieh (co-founder and Chairman), Jian Tang (co-founder and CEO) and <a href="https://www.smartkarma.com/entities/baozun-inc" target="_blank" data-smartkarma-citation="entities:24184:1" rel="noopener">Baozun Inc. (BZUN US)</a>. Mr Hsieh and Mr Tang together represent around 62% of voting interests. PAG and Oasis’ letter to the board mentions an intention to acquire all the shares other than those “shares held by the members of management and other strategic shareholders of the Company that may be rolled over in connection with the proposed transaction.” The wording suggests that PAG and Oasis are in advanced stages of discussions with the co-founders and <a href="https://www.smartkarma.com/entities/baozun" target="_blank" data-smartkarma-citation="entities:29712:1" rel="noopener">Baozun (9991 HK)</a>. iClick’s shares reached an all-time high of $18.30 per ADS on 18 February 2021 on the back of the announcement that Baozun acquired 4% of outstanding shares and 10% voting interest at $13.262 per ADS. In part due to China’s regulatory clampdown on tech names, the shares have since headed downwards to reach a YTD low of $4.16 per ADS on 20 August. <div class="content-highlight">The offer is unattractive in comparison to historical share prices and multiples, in our view. The offer is designed to take advantage of the sell-off in Chinese tech names by enriching insiders at the expense of minorities. The timing of the offer announcement points to PAG and Oasis’ confidence in gaining the co-founders and/or Bazoun’s support as rollover shareholders. We think that there is a decent chance that privatisation succeeds. At the last close of $5.91 per ADS, the gross spread to the offer price is 14.2%.  </div>

iClick Interactive Asia Group (ICLK US) is a leading enterprise and marketing cloud platform in China. It is a platinum provider to Tencent (700 HK) in social advertising and provides one-stop solutions in user acquisition and engagement. iClick was listed on Nasdaq in December 2017 at $8.00 per ADS and raised net proceeds of $23.3 million.  On 24 September, iClick announced a non-binding privatisation proposal from PAG and Oasis Management. The bid of $6.75 in cash per ADS represents a premium of 19.5% to the undisturbed price (on 23 September). As iClick is incorporated in the Cayman Islands, for the privatisation to succeed, shareholders representing two-thirds of shares present and voting need to approve the deal. PAG and Oasis have not disclosed a shareholding. iClick’s three largest shareholders are Wing Hong Sammy Hsieh (co-founder and Chairman), Jian Tang (co-founder and CEO) and Baozun Inc. (BZUN US). Mr Hsieh and Mr Tang together represent around 62% of voting interests. PAG and Oasis’ letter to the board mentions an intention to acquire all the shares other than those “shares held by the members of management and other strategic shareholders of the Company that may be rolled over in connection with the proposed transaction.” The wording suggests that PAG and Oasis are in advanced stages of discussions with the co-founders and Baozun (9991 HK). iClick’s shares reached an all-time high of $18.30 per ADS on 18 February 2021 on the back of the announcement that Baozun acquired 4% of outstanding shares and 10% voting interest at $13.262 per ADS. In part due to China’s regulatory clampdown on tech names, the shares have since headed downwards to reach a YTD low of $4.16 per ADS on 20 August. The offer is unattractive in comparison to historical share prices and multiples, in our view. The offer is designed to take advantage of the sell-off in Chinese tech names by enriching insiders at the expense of minorities. The timing of the offer announcement points to PAG and Oasis’ confidence in gaining the co-founders and/or Bazoun’s support as rollover shareholders. We think that there is a decent chance that privatisation succeeds. At the last close of $5.91 per ADS, the gross spread to the offer price is 14.2%.  

IClick’s Privatisation Bid from PAG and Oasis

United States

Baozun Inc. provides e-commerce solutions. The Company's services include website design, development and hosting, information technology infrastructure, customer service, warehousing, and logistics services, as well as digital marketing. Baozun serves customers in China.

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Baozun Inc. (BZUN US)

Huitongda Network IPO Initiation: Clicks to Bricks

Huitongda is pre-marketing an HKEx IPO to raise US$400-500 million. Overall, we think that the positives outweigh the negatives and this IPO is...

Arun George

Weibo Secondary Listing - Going Down the Autohome Route

Weibo plans to raise around US$470m in its secondary listing in Hong Kong. In this note, we will talk about the deal pricing and structure.

Sumeet Singh

Weibo Secondary Listing - Needs to Come at a Discount

Weibo plans to raise around US$500-700m in its secondary listing in Hong Kong. In this note, we talk about the deal and its impact.

Sumeet Singh

IClick’s Improved Privatisation Bid from a Second Suitor

iClick announced another privatisation proposal, this time from Infinity Equity at $7.50 in cash per ADS. The emergence of two bidders suggests...

Arun George

IClick’s Privatisation Bid from PAG and Oasis

The $6.75 per ADS offer is designed to take advantage of the market sell-off by enriching insiders at the expense of minorities. If the co-founders...

Arun George

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