European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>American Tower stated during FY 2022 results presentation that debt reduction is its main priority. The probability of a takeover bid for Cellnex by American Tower and Brookfield is reduced.</li>
<li>Cellnex on 14.7x EV/NTM EBITDAe is trading cheaply vs. AMT on 19.5x and below private equity deals at 25-30x. I believe that Cellnex's fundamentals are solid, and would be long.</li>
<li>Cellnex is the undisputed European leader in telecommunications towers with both high cash flow visibility (growth forecasted at 18% for the period 2021-2025e) and trading at 7.3% 22e FCF yield.</li>
</ul>


American Tower stated during FY 2022 results presentation that debt reduction is its main priority. The probability of a takeover bid for Cellnex by American Tower and Brookfield is reduced.
Cellnex on 14.7x EV/NTM EBITDAe is trading cheaply vs. AMT on 19.5x and below private equity deals at 25-30x. I believe that Cellnex's fundamentals are solid, and would be long.
Cellnex is the undisputed European leader in telecommunications towers with both high cash flow visibility (growth forecasted at 18% for the period 2021-2025e) and trading at 7.3% 22e FCF yield.


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>A Brookfield/MidOcean consortium has made a conditional, non-binding, indicative proposal to acquire 100% of the shares in <a href="https://www.smartkarma.com/entities/origin-energy-ltd" target="_blank" data-smartkarma-citation="entities:797:1" rel="noopener">Origin Energy (ORG AU)</a> at A$9/share in cash.</li>
<li>The offer values <a href="https://www.smartkarma.com/entities/origin-energy-ltd" target="_blank" data-smartkarma-citation="entities:797:1" rel="noopener">Origin Energy (ORG AU)</a>'s equity at A$15.5bn and is a 54.9% premium to the last close. The premium is over 50% even using longer term VWAPs.</li>
<li>There will be changes to the S&amp;P/ASX family of indices to maintain the number of index members. We will know more once an indicative timeline is published.</li>
</ul>


A Brookfield/MidOcean consortium has made a conditional, non-binding, indicative proposal to acquire 100% of the shares in Origin Energy (ORG AU) at A$9/share in cash.
The offer values Origin Energy (ORG AU)'s equity at A$15.5bn and is a 54.9% premium to the last close. The premium is over 50% even using longer term VWAPs.
There will be changes to the S&amp;P/ASX family of indices to maintain the number of index members. We will know more once an indicative timeline is published.


Origin Energy (ORG AU): Indicative Proposal from Brookfield & MidOcean; Index Implications

<ul>
<li>Brookfield now controls 84.94% (including treasury shares), which means that REIT status will be lost. Brookfield thus will seek to reopen acceptance periods until reaching 95% (squeeze out threshold in Belgium).</li>
<li>Bidco reopened the acceptance period on 29 August, with closing on 16 September, and settlement on 7 October. Gross spread is 0.21%, with an estimated annual return of 2.07%.</li>
<li>Shareholders should tender, liquidity has been greatly reduced and the REIT tax advantages will disappear sooner rather than later.</li>
</ul>


Brookfield now controls 84.94% (including treasury shares), which means that REIT status will be lost. Brookfield thus will seek to reopen acceptance periods until reaching 95% (squeeze out threshold in Belgium).
Bidco reopened the acceptance period on 29 August, with closing on 16 September, and settlement on 7 October. Gross spread is 0.21%, with an estimated annual return of 2.07%.
Shareholders should tender, liquidity has been greatly reduced and the REIT tax advantages will disappear sooner rather than later.


Brookfield/​Befimmo: Additional Acceptance Period

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>On 23 August, Intel announced that it will partner with Canada's Brookfield Asset Management to jointly fund up to $30 billion to make advanced semiconductor chips in Arizona. </li>
<li>Despite Intel's aggressive plans to expand the semiconductor chip production, we are more concerned about the overall downturn in the semiconductor sector which lead to further decline in sales. </li>
<li>Despite our negative view of Intel's shares in the near term, Intel could gain market share versus Samsung and TSMC in the semiconductor sector in the next three years.</li>
</ul>


On 23 August, Intel announced that it will partner with Canada's Brookfield Asset Management to jointly fund up to $30 billion to make advanced semiconductor chips in Arizona. 
Despite Intel's aggressive plans to expand the semiconductor chip production, we are more concerned about the overall downturn in the semiconductor sector which lead to further decline in sales. 
Despite our negative view of Intel's shares in the near term, Intel could gain market share versus Samsung and TSMC in the semiconductor sector in the next three years.


Intel's $30 Billion JV with Brookfield Asset Mgmt: To Take Away Market Share from TSMC & Samsung?

<ul>
<li>Media reports that HomeServe and Brookfield are close to reaching an agreement. Since news of the approach broke, the share price of HomeServe has increased by c. 52%.</li>
<li>My fair value estimate (DCF based) is 1,206p, which could presumably be enough for the founder to sell its 12.1% stake (enough to prevent a squeeze-out).</li>
<li>At1,206p (71% premium to the price prior to disclosures), a financial buyer could obtain a 15.3% cumulative IRR by year 8. <strong>Long HSV LN</strong>.</li>
</ul>


Media reports that HomeServe and Brookfield are close to reaching an agreement. Since news of the approach broke, the share price of HomeServe has increased by c. 52%.
My fair value estimate (DCF based) is 1,206p, which could presumably be enough for the founder to sell its 12.1% stake (enough to prevent a squeeze-out).
At1,206p (71% premium to the price prior to disclosures), a financial buyer could obtain a 15.3% cumulative IRR by year 8. Long HSV LN.


Brookfield/HomeServe Close to Reaching an Agreement

Canada

Brookfield Asset Management Ltd. operates as an investment management firm. The Company focuses on property development, renewable energy, infrastructure, insurance, and private equity. Brookfield Asset Management serves customers worldwide.

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Brookfield Asset Management Lt (BAM US)

AMT/Cellnex: Lower Chances of a Bid

American Tower stated during FY 2022 results presentation that debt reduction is its main priority. The probability of a takeover bid for Cellnex...

Jesus Rodriguez Aguilar

Origin Energy (ORG AU): Indicative Proposal from Brookfield & MidOcean; Index Implications

A Brookfield/MidOcean consortium has made an NBIO for Origin at A$9/share, a 54.9% premium to last. There is a high probability of this going...

Brian Freitas

Brookfield/Befimmo: Additional Acceptance Period

Brookfield now controls 84.94% (including treasury shares), which means that REIT status will be lost. Brookfield thus will seek to reopen...

Jesus Rodriguez Aguilar

Brookfield/HomeServe Close to Reaching an Agreement

HomeServe and Brookfield are close to reaching an agreement (around 1200p). Since news of the approach broke, the shares have had an excellent run...

Jesus Rodriguez Aguilar

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AMT/​Cellnex: Lower Chances of a Bid

American Tower stated during FY 2022 results presentation that debt reduction is its main priority. The probability of a takeover bid for Cellnex...

Jesus Rodriguez Aguilar

Origin Energy (ORG AU): Indicative Proposal from Brookfield & MidOcean; Index Implications

A Brookfield/MidOcean consortium has made an NBIO for Origin at A$9/share, a 54.9% premium to last. There is a high probability of this going...

Brian Freitas

Brookfield/​Befimmo: Additional Acceptance Period

Brookfield now controls 84.94% (including treasury shares), which means that REIT status will be lost. Brookfield thus will seek to reopen...

Jesus Rodriguez Aguilar

Intel's $30 Billion JV with Brookfield Asset Mgmt: To Take Away Market Share from TSMC & Samsung?

On 23 August, Intel announced that it will partner with Canada's Brookfield Asset Management to jointly fund up to $30 billion to make advanced...

Douglas Kim

Brookfield/HomeServe Close to Reaching an Agreement

HomeServe and Brookfield are close to reaching an agreement (around 1200p). Since news of the approach broke, the shares have had an excellent run...

Jesus Rodriguez Aguilar

AMT/Cellnex: Lower Chances of a Bid

Brookfield/Befimmo: Additional Acceptance Period