Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dai-nippon-printing-co-ltd" target="_blank" data-smartkarma-citation="entities:19388:1" rel="noopener">Dai Nippon Printing (7912 JP)</a> is a range trade. The juice is in the speed of the Corporate Buyback and how excited people get.</li>
<li>With the renewal of the gaming concession in the bag and <a href="https://www.smartkarma.com/entities/melco-crown-entertainme-adr" target="_blank" data-smartkarma-citation="entities:810:1" rel="noopener">Melco Resorts (MLCO US)</a> up 128% in the past six months, <a href="https://www.smartkarma.com/entities/melco-international-development-ltd" target="_blank" data-smartkarma-citation="entities:809:1" rel="noopener">Melco (200 HK)</a> has extracted ~HK$2.5bn from MLCO.</li>
<li>
<a href="https://www.smartkarma.com/entities/hosokawa-micron-corp" target="_blank" data-smartkarma-citation="entities:6433:1" rel="noopener">Hosokawa Micron (6277 JP)</a>'s current PER of 9.9x ignores that net cash and securities holdings is about half of market cap. This is a cheap stock.  </li>
</ul>



Dai Nippon Printing (7912 JP) is a range trade. The juice is in the speed of the Corporate Buyback and how excited people get.
With the renewal of the gaming concession in the bag and Melco Resorts (MLCO US) up 128% in the past six months, Melco (200 HK) has extracted ~HK$2.5bn from MLCO.

Hosokawa Micron (6277 JP)'s current PER of 9.9x ignores that net cash and securities holdings is about half of market cap. This is a cheap stock.  


Last Week in Event SPACE: Dai Nippon Printing, Melco, Hosokawa Micron,Tencent/Meituan, Ihara Science

European Event-Driven Analyst

Jesus Rodriguez Aguilar

<ul>
<li>On 8 March, the Bain's consortium announced that it will lower the minimum acceptance threshold from over 66.66% to over 50%. Irrevocables seem to have ceased to be in effect.</li>
<li>Triton's all in: the acceptance period for its offer commenced on 8 March, has agreed to purchase up to 22.8% and will resume buying in the market.</li>
<li>Gross spread is 1.1%. I'd be long in case the Bain's consortium improves Triton's offer, which may depend on the additional debt than private members of Bain's consortium could afford.</li>
</ul>


On 8 March, the Bain's consortium announced that it will lower the minimum acceptance threshold from over 66.66% to over 50%. Irrevocables seem to have ceased to be in effect.
Triton's all in: the acceptance period for its offer commenced on 8 March, has agreed to purchase up to 22.8% and will resume buying in the market.
Gross spread is 1.1%. I'd be long in case the Bain's consortium improves Triton's offer, which may depend on the additional debt than private members of Bain's consortium could afford.


Acceptance Period for Triton's Offer Commences, Irrevocables for Bain's Cease to Be in Effect

<ul>
<li>Triton has raised its offer price to €8.95 in cash, 5.3% above the Alternative Consideration of the Bain's consortium improved offer (vs. my €9.01/share fair value estimate, comps-based).</li>
<li>Gross spread is +0.78%. It seems that now it is the turn of the Bain's consortium to make a move, at least match and probably bid over Triton's offer.</li>
<li>Bain has the main shareholders on board. As of 24 February, I estimate the paper profits of Triton to be around €31 million (minus the costs of preparing the offer).</li>
</ul>


Triton has raised its offer price to €8.95 in cash, 5.3% above the Alternative Consideration of the Bain's consortium improved offer (vs. my €9.01/share fair value estimate, comps-based).
Gross spread is +0.78%. It seems that now it is the turn of the Bain's consortium to make a move, at least match and probably bid over Triton's offer.
Bain has the main shareholders on board. As of 24 February, I estimate the paper profits of Triton to be around €31 million (minus the costs of preparing the offer).


<ul>
<li>The Bain's consortium announced an agreed sweetened offer (Alternative Consideration, shares exchanged for a zero-coupon debt instrument redeemable at €8.5 by mid-December), 6.25% premium to Triton's offer.</li>
<li>The Alternative Consideration (illiquid) corresponds to 16.3x EV/Fwd EBIT and 19.3x Fwd P/E. There are high chances that the bidding process will stop, but would still be long the shares.</li>
<li>The Bain's consortium has now all regulatory approvals. Gross spread is 0.82%, with an estimated annual return of 0.90% assuming settlement of the Alternative Consideration Instrument by 29 December.</li>
</ul>


The Bain's consortium announced an agreed sweetened offer (Alternative Consideration, shares exchanged for a zero-coupon debt instrument redeemable at €8.5 by mid-December), 6.25% premium to Triton's offer.
The Alternative Consideration (illiquid) corresponds to 16.3x EV/Fwd EBIT and 19.3x Fwd P/E. There are high chances that the bidding process will stop, but would still be long the shares.
The Bain's consortium has now all regulatory approvals. Gross spread is 0.82%, with an estimated annual return of 0.90% assuming settlement of the Alternative Consideration Instrument by 29 December.


North Holdings 3/​Caverion: Fair Enough

<ul>
<li>On 10 January, former significant shareholder Triton gatecrashed the Bain Capital consortium offer with an €8/share hostile competing offer, 14.3% premium to Bain's). There could be upside up to c.€9.01.</li>
<li>Shareholder families have a c.27% (thus blocking) stake. Either they cash out in Triton's offer, with a possible sweetener (a small increase could be likely) or will raise over Triton's.</li>
<li>The shares are trading 0.62% above Triton's offer on expectations of a bidding war and/or that offer is not declared unconditional by 30 June. Risk/return looks again positive. Long.</li>
</ul>


On 10 January, former significant shareholder Triton gatecrashed the Bain Capital consortium offer with an €8/share hostile competing offer, 14.3% premium to Bain's). There could be upside up to c.€9.01.
Shareholder families have a c.27% (thus blocking) stake. Either they cash out in Triton's offer, with a possible sweetener (a small increase could be likely) or will raise over Triton's.
The shares are trading 0.62% above Triton's offer on expectations of a bidding war and/or that offer is not declared unconditional by 30 June. Risk/return looks again positive. Long.


Finland

Caverion Corporation provides building systems and industrial services in the Nordic countries, Central Europe, Russia and the Baltic countries. The Company provides services that cover all building systems in properties, including HVAC systems, security, fire safety and telecommunications systems as well as the automation that controls them.

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Caverion Corp (CAV1V FH)

Last Week in Event SPACE: Dai Nippon Printing, Melco, Hosokawa Micron,Tencent/Meituan, Ihara Science

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

Acceptance Period for Triton's Offer Commences, Irrevocables for Bain's Cease to Be in Effect

The battle heats up: Bain's consortium lowers the acceptance threshold to >50% while Triton has agreements to purchase up to 22.8% to become the...

Jesus Rodriguez Aguilar

A Good Old Fashioned Bidding War

On 24 February, Crayfish increased the offer price to €8.95/share in cash, 28% premium to the original Bain's offer, and 5.3% higher than the...

Jesus Rodriguez Aguilar

North Holdings 3/Caverion: Fair Enough

The Bain's consortium announced an agreed sweetened offer, 6.25% premium to Triton's offer, which presents several advantages over Triton's offer...

Jesus Rodriguez Aguilar

Triton/Caverion: Hostile Competing Offer

Former significant shareholder Triton announced a €8/share competing hostile offer that "rewards all shareholders appropriately for the...

Jesus Rodriguez Aguilar

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Last Week in Event SPACE: Dai Nippon Printing, Melco, Hosokawa Micron,Tencent/Meituan, Ihara Science

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

Acceptance Period for Triton's Offer Commences, Irrevocables for Bain's Cease to Be in Effect

The battle heats up: Bain's consortium lowers the acceptance threshold to >50% while Triton has agreements to purchase up to 22.8% to become the...

Jesus Rodriguez Aguilar

A Good Old Fashioned Bidding War

On 24 February, Crayfish increased the offer price to €8.95/share in cash, 28% premium to the original Bain's offer, and 5.3% higher than the...

Jesus Rodriguez Aguilar

North Holdings 3/​Caverion: Fair Enough

The Bain's consortium announced an agreed sweetened offer, 6.25% premium to Triton's offer, which presents several advantages over Triton's offer...

Jesus Rodriguez Aguilar

Triton/Caverion: Hostile Competing Offer

Former significant shareholder Triton announced a €8/share competing hostile offer that "rewards all shareholders appropriately for the...

Jesus Rodriguez Aguilar

North Holdings 3/Caverion: Fair Enough