Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>BHP goes ex-WPL at the open of 25 May 2022. The ex-WPL price is A$5.24 lower than Tuesday's close and there is another A$2.20 of franking credits on top.</li>
<li>Historically, the BHP/RIO ratio has traded within a relatively defined range. It moves, then after a while it tends to revert. I present a trading model.</li>
<li>And grids. I present spinoff grids with live tracking of the BHP ex-WPL/RIO Ratio within its last 6- and 12-month (div-adjusted) ratios.</li>
</ul>


BHP goes ex-WPL at the open of 25 May 2022. The ex-WPL price is A$5.24 lower than Tuesday's close and there is another A$2.20 of franking credits on top.
Historically, the BHP/RIO ratio has traded within a relatively defined range. It moves, then after a while it tends to revert. I present a trading model.
And grids. I present spinoff grids with live tracking of the BHP ex-WPL/RIO Ratio within its last 6- and 12-month (div-adjusted) ratios.


Marking Post-WPL-Spin BHP to Market and Model

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>BHP shareholders will receive US$18bn worth of Woodside petroleum shares on 1st Jun 2022, post the completion of the merger. Block, worth US$1.5bn, could be sold in early June.</li>
<li>As a part of the distribution, some shares belonging to ineligible and other small shareholders will have to be sold by the sales agent, JPM. </li>
<li>In this note, we will look at the possible deal dynamics and the overall background of the deal.</li>
</ul>


BHP shareholders will receive US$18bn worth of Woodside petroleum shares on 1st Jun 2022, post the completion of the merger. Block, worth US$1.5bn, could be sold in early June.
As a part of the distribution, some shares belonging to ineligible and other small shareholders will have to be sold by the sales agent, JPM. 
In this note, we will look at the possible deal dynamics and the overall background of the deal.


BHP Woodside Distribution - Could Be a Large Block (~US$1bn) In Early June

<ul>
<li>The EGM of <a href="https://www.smartkarma.com/entities/woodside-petroleum-ltd" target="_blank" data-smartkarma-citation="entities:177:1" rel="noopener">Woodside Petroleum (WPL AU)</a> today approved the BHP Petroleum merger in overwhelming fashion. 98.66% FOR. </li>
<li>They did not approve of the Climate Report the board submitted to vetting by shareholders for the first time. That got 51% "support."</li>
<li>But now that's done, people will talk about flows. So far the trade has worked but now time to think about how far to stretch it.</li>
</ul>


The EGM of Woodside Petroleum (WPL AU) today approved the BHP Petroleum merger in overwhelming fashion. 98.66% FOR. 
They did not approve of the Climate Report the board submitted to vetting by shareholders for the first time. That got 51% "support."
But now that's done, people will talk about flows. So far the trade has worked but now time to think about how far to stretch it.


Woodside Shareholders Approve Deal but Not WPL's Green Credentials; Now People Talk About Flows

David Blennerhassett

<ul>
<li>The <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> / <a href="https://www.smartkarma.com/entities/ntt-data-corp" target="_blank" data-smartkarma-citation="entities:11232:1" rel="noopener">NTT Data (9613 JP)</a> transaction is a little complicated, but the end goal appears, like before, to push operating control below holdcos on the chain. </li>
<li>Both <a href="https://www.smartkarma.com/entities/link-administration-holdings-ltd" target="_blank" data-smartkarma-citation="entities:970:1" rel="noopener">Link Administration (LNK AU)</a> and Dye &amp; Durham tanked over the unfortunate timing of an ACCC delay and MAC disconnect - before a price recovery to close the week.</li>
<li>MCB says the <a href="https://www.smartkarma.com/entities/agl-energy-ltd" target="_blank" data-smartkarma-citation="entities:554:1" rel="noopener">AGL Energy Ltd (AGL AU)</a> de-merger plan is bad, and now analysts say it is "underwhelming." Duh.  But the alternative? Underwhelming too, but less independent.</li>
</ul>


The NTT (9432 JP) / NTT Data (9613 JP) transaction is a little complicated, but the end goal appears, like before, to push operating control below holdcos on the chain. 
Both Link Administration (LNK AU) and Dye &amp; Durham tanked over the unfortunate timing of an ACCC delay and MAC disconnect - before a price recovery to close the week.
MCB says the AGL Energy Ltd (AGL AU) de-merger plan is bad, and now analysts say it is "underwhelming." Duh.  But the alternative? Underwhelming too, but less independent.


Last Week in Event SPACE:  NTT, Link Admin, AGL, Mindtree/Larsen & Toubro, Sihuan Pharma

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bhp-group-ltd" target="_blank" data-smartkarma-citation="entities:147:1" rel="noopener">BHP Group Ltd (BHP AU)</a> and <a href="https://www.smartkarma.com/entities/woodside-petroleum-ltd" target="_blank" data-smartkarma-citation="entities:177:1" rel="noopener">Woodside Petroleum (WPL AU)</a> announced a merger of BHP Petroleum with Woodside late last year, to be implemented in Q2 2022</li>
<li>The vote is in a week, and BHP is expected to trade ex- WPL share spinoff on 24 May 2022, with delivery a week later. </li>
<li>The trade so far has worked well, and there has been a slight additive flow pattern in the last several days. It is worth thinking closely about timing.</li>
</ul>



BHP Group Ltd (BHP AU) and Woodside Petroleum (WPL AU) announced a merger of BHP Petroleum with Woodside late last year, to be implemented in Q2 2022
The vote is in a week, and BHP is expected to trade ex- WPL share spinoff on 24 May 2022, with delivery a week later. 
The trade so far has worked well, and there has been a slight additive flow pattern in the last several days. It is worth thinking closely about timing.


Woodside/BHP And the Timing Of The Trade Flows Vs Peers

Australia

BHP Group Limited operates as a mining company.  The Companyengages in the exploration, development, production and processing of iron ore, metallurgical coal, and copper. BHP Group serves customers worldwide.

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BHP Group Ltd (BHP LN)

Marking Post-WPL-Spin BHP to Market and Model

BHP vs RIO changes shape on 25 May 2022 as the WPL spin-off goes live. This is a look at the new BHP/RIO pair, with BHP ex-WPL history, and a...

Travis Lundy

BHP Woodside Distribution - Could Be a Large Block (~US$1bn) In Early June

BHP shareholders will receive US$18bn worth of Woodside petroleum shares on 1st Jun 2022, post the completion of the merger. Block, worth US$1.5bn,...

Sumeet Singh

Woodside Shareholders Approve Deal but Not WPL's Green Credentials; Now People Talk About Flows

Woodside shareholders approve the merger with BHP Petroleum creating a top 10 global independent. Articles will now talk about sell flow/overhang,...

Travis Lundy

Last Week in Event SPACE: NTT, Link Admin, AGL, Mindtree/Larsen & Toubro, Sihuan Pharma

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

Woodside/BHP And the Timing Of The Trade Flows Vs Peers

Woodside Petroleum (WPL) continues to drift lower vs Aussie-listed Peers Beach and Santos as we approach the BHP distribution of WPL shares which...

Travis Lundy

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