Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The Scheme Document for <strong><a href="https://www.smartkarma.com/entities/cp-pokphand-co-ltd" target="_blank" data-smartkarma-citation="entities:10135:1" rel="noopener">Cp Pokphand (43 HK)</a></strong> (CPP) has been dispatched. The Scheme Meeting will take place on the 15 December. </li>
<li>
<a href="https://www.smartkarma.com/entities/charoen-pokphand-foods-public-company-limited" target="_blank" data-smartkarma-citation="entities:16131:1" rel="noopener"><strong>CP FOODS (CPF TB)</strong></a> and <strong><a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a></strong> with 49.74% and 25% of shares out respectively are offering HK$1.15/share for CPP, a leading agri-food conglomerate in China and Vietnam. </li>
<li>The Independent Financial Adviser (Ballas Capital) considers the Scheme to be fair and reasonable. Assuming the Scheme gets up, payment is the 25 January, on or before.</li>
</ul>


The Scheme Document for Cp Pokphand (43 HK) (CPP) has been dispatched. The Scheme Meeting will take place on the 15 December. 

CP FOODS (CPF TB) and Itochu Corp (8001 JP) with 49.74% and 25% of shares out respectively are offering HK$1.15/share for CPP, a leading agri-food conglomerate in China and Vietnam. 
The Independent Financial Adviser (Ballas Capital) considers the Scheme to be fair and reasonable. Assuming the Scheme gets up, payment is the 25 January, on or before.


C.P. Pokphand (43 HK): Scheme Doc Out. Meeting on 15 December

Investment Research - Asia Consumer Sector, Investory

Devi Subhakesan

Investment Research - Asia Consumer Sector

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

<p><a href="https://www.smartkarma.com/entities/asian-sea-corp-pcl" target="_blank" data-smartkarma-citation="entities:19827:1" rel="noopener">Asian Sea (ASIAN TB)</a> announced its plans to list the pet food business currently held in the 100% subsidiary Asian Alliance International (AAI), subject to regulatory approvals.  Asian Sea will hold a majority stake (not less than 70%) in the spun-off subsidiary post listing. This could potentially help unlock value for Asian Sea assuming the high growth pet food subsidiary could attract greater investor interest and superior valuation, post listing. Currently <a href="https://www.smartkarma.com/entities/asian-sea-corp-pcl" target="_blank" data-smartkarma-citation="entities:19827:1" rel="noopener">Asian Sea (ASIAN TB)</a>  trades at low double digit P/E in line with other Thailand based sea food processing companies.</p><p>In this insight, we discuss likely value upside to <a href="https://www.smartkarma.com/entities/asian-sea-corp-pcl" target="_blank" data-smartkarma-citation="entities:19827:1" rel="noopener">Asian Sea (ASIAN TB)</a>  based on Asian Alliance's possible valuations upon listing (based on its reported financials).</p>

Asian Sea (ASIAN TB) announced its plans to list the pet food business currently held in the 100% subsidiary Asian Alliance International (AAI), subject to regulatory approvals.  Asian Sea will hold a majority stake (not less than 70%) in the spun-off subsidiary post listing. This could potentially help unlock value for Asian Sea assuming the high growth pet food subsidiary could attract greater investor interest and superior valuation, post listing. Currently Asian Sea (ASIAN TB)  trades at low double digit P/E in line with other Thailand based sea food processing companies.In this insight, we discuss likely value upside to Asian Sea (ASIAN TB)  based on Asian Alliance's possible valuations upon listing (based on its reported financials).

Asian Sea Corp (ASIAN TB): Spin-Off Listing of Pet Food Likely Intended to Unlock Value.

<div>
<p>A little over a week ago, Bloomberg <a href="https://www.just-food.com/news/chinese-dairy-firm-yili-said-to-be-weighing-approach-for-infant-formula-maker-ausnutria/" target="_blank" rel="noopener">reported</a> <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 (A) (600887 CH)</a>, China’s biggest dairy producer, had been running a ruler over infant-formula firm <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>.</p>
<p>Before the commencement of trading yesterday, Ausnutria was <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1012/2021101200109.pdf" target="_blank" rel="noopener">suspended</a> pursuant to the Hong Kong Code on Takeovers and Mergers. Shares had gained 7.8% on Monday (the 11th) on the largest volume since November of last year. </p>
</div>
<div>
<p><a href="https://www.smartkarma.com/entities/charoen-pokphand-foods-public-company-limited" target="_blank" data-smartkarma-citation="entities:16131:1" rel="noopener"></a>SOE CITIC Group is the largest shareholder with <a href="https://di.hkex.com.hk/di/NSForm2.aspx?fn=CS20200831E00300&amp;sa2=as&amp;sid=37215&amp;corpn=Ausnutria+Dairy+Corporation+Ltd.&amp;sd=13%2f10%2f2020&amp;ed=13%2f10%2f2021&amp;cid=0&amp;sa1=cl&amp;scsd=13%2f10%2f2020&amp;sced=13%2f10%2f2021&amp;sc=1717&amp;src=MAIN&amp;lang=EN&amp;g_lang=en&amp;" target="_blank" rel="noopener">22.05%</a>, having being introduced as a strategic investor back in October 2018.</p>
</div>
<div>
<p>This insight provides some brief background on Ausnutria, plus speculates on a fair price should a firm Offer unfold. </p>
</div>


A little over a week ago, Bloomberg reported Inner Mongolia Yili Industrial Group (A) (600887 CH), China’s biggest dairy producer, had been running a ruler over infant-formula firm Ausnutria Dairy Corp (1717 HK).
Before the commencement of trading yesterday, Ausnutria was suspended pursuant to the Hong Kong Code on Takeovers and Mergers. Shares had gained 7.8% on Monday (the 11th) on the largest volume since November of last year. 


SOE CITIC Group is the largest shareholder with 22.05%, having being introduced as a strategic investor back in October 2018.


This insight provides some brief background on Ausnutria, plus speculates on a fair price should a firm Offer unfold. 


<div>
<p>After being <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0927/2021092700107.pdf" target="_blank" rel="noopener">suspended</a> on the 27 September pursuant to the Hong Kong Code on Takeovers and Mergers, <a href="https://www.smartkarma.com/entities/cp-pokphand-co-ltd" target="_blank" data-smartkarma-citation="entities:10135:1" rel="noopener">Cp Pokphand (43 HK)</a> ("CPP"), a leading agri-food conglomerate in China and Vietnam, has now announced an Offer, by way of a Scheme, from <a href="https://www.smartkarma.com/entities/charoen-pokphand-foods-public-company-limited" target="_blank" data-smartkarma-citation="entities:16131:1" rel="noopener">CP Foods (CPF TB)</a>.</p>
<p>The consideration is $1.15/share, a 19.79% premium to last close. The Offer price will NOT be increased.</p>
<p>CPF holds 49.74% and <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> 25%. Itochu has entered into a rollover agreement with CPF such that upon successful completion of the Scheme, CPF will hold 75% and Itochu 25%. </p>
<p>The Offer premium is a trifle light to that consistently seen in Hong Kong M&amp;A deals in recent years. Nevertheless, this all looks stitched up and should trade tight when shares resume trading on Monday.</p>
<p>More below the fold. </p>
</div>
<div>
<p></p>
</div>


After being suspended on the 27 September pursuant to the Hong Kong Code on Takeovers and Mergers, Cp Pokphand (43 HK) ("CPP"), a leading agri-food conglomerate in China and Vietnam, has now announced an Offer, by way of a Scheme, from CP Foods (CPF TB).
The consideration is $1.15/share, a 19.79% premium to last close. The Offer price will NOT be increased.
CPF holds 49.74% and Itochu Corp (8001 JP) 25%. Itochu has entered into a rollover agreement with CPF such that upon successful completion of the Scheme, CPF will hold 75% and Itochu 25%. 
The Offer premium is a trifle light to that consistently seen in Hong Kong M&amp;A deals in recent years. Nevertheless, this all looks stitched up and should trade tight when shares resume trading on Monday.
More below the fold. 





C.P. Pokphand (43 HK): Privatisation Offer From CP Foods

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.

<p><a href="https://www.smartkarma.com/entities/cp-pokphand-co-ltd" target="_blank" data-smartkarma-citation="entities:10135:1" rel="noopener">Cp Pokphand (43 HK)</a> (CPP) is a leading agri-food conglomerate in China and Vietnam. After market close on Thursday, it announced a privatisation offer by way of a scheme of arrangement from <a href="https://www.smartkarma.com/entities/charoen-pokphand-foods-public-company-limited" target="_blank" data-smartkarma-citation="entities:16131:1" rel="noopener">CP FOODS (CPF TB)</a>, the largest shareholder (49.74% of the outstanding shares). The offeror will offer HK$1.15 in cash for each scheme share. The bid represents a premium of 19.79% over the closing price of HK$0.96 per share on the last trading date (24 September prior to the trading halt). </p><p>For good measure, CPP also released a statement outlining a profit warning. CPP noted that the net profit would decline -75% YoY in 8M21, which marks a deterioration to the net profit decline of -50% YoY in 1H21. The profit warning was attributed mainly to a poor performance in China caused by lower poultry and swine prices. CPP notes that poultry and swine prices in China and swine prices in Vietnam will have fallen further in September. </p><div class="content-highlight"><p>The key condition precedents are the headcount test along with the scheme approved by at least 75% disinterested shareholders and &lt;10% rejection by all disinterested shareholders. As disinterested scheme shareholders represent 5,958.8 million shares or 24.75% of shares outstanding, the 10% blocking stake is 595.9 million shares or 2.48% of shares outstanding. No shareholder holds a blocking stake. Overall, we think the offer price is attractive and that the privatisation bid will be successful. </p></div>

Cp Pokphand (43 HK) (CPP) is a leading agri-food conglomerate in China and Vietnam. After market close on Thursday, it announced a privatisation offer by way of a scheme of arrangement from CP FOODS (CPF TB), the largest shareholder (49.74% of the outstanding shares). The offeror will offer HK$1.15 in cash for each scheme share. The bid represents a premium of 19.79% over the closing price of HK$0.96 per share on the last trading date (24 September prior to the trading halt). For good measure, CPP also released a statement outlining a profit warning. CPP noted that the net profit would decline -75% YoY in 8M21, which marks a deterioration to the net profit decline of -50% YoY in 1H21. The profit warning was attributed mainly to a poor performance in China caused by lower poultry and swine prices. CPP notes that poultry and swine prices in China and swine prices in Vietnam will have fallen further in September. The key condition precedents are the headcount test along with the scheme approved by at least 75% disinterested shareholders and &lt;10% rejection by all disinterested shareholders. As disinterested scheme shareholders represent 5,958.8 million shares or 24.75% of shares outstanding, the 10% blocking stake is 595.9 million shares or 2.48% of shares outstanding. No shareholder holds a blocking stake. Overall, we think the offer price is attractive and that the privatisation bid will be successful. 

C.P. Pokphand’s Privatisation Bid from CPF

Thailand

Charoen Pokphand Foods Public Company Limited produces a wide range of food products. The Company's products include chicken, pork, shrimp, fish, eggs. and duck.

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CP FOODS (CPF TB)

C.P. Pokphand (43 HK): Scheme Doc Out. Meeting on 15 December

This still looks a pretty clean deal. I'd be paying up to and around $1.12/share which is ~3.6%/15% gross/annualised spread.

David Blennerhassett

Asian Sea Corp (ASIAN TB): Spin-Off Listing of Pet Food Likely Intended to Unlock Value.

Discuss valuations and potential upside from proposed spin-off listing of Asian Sea's Pet food subsidiary. Likely catalyst for stock's valuation...

Devi Subhakesan

Will Yili Gulp Down Ausnutria (1717 HK)?

Ausnutria is currently trading around multi-year high lows on all metrics despite edging towards an all-time profit high. Optically, this could...

David Blennerhassett

C.P. Pokphand (43 HK): Privatisation Offer From CP Foods

This looks pretty clean. Assuming mid-Feb completion, I'd be paying up to and around $1.11/share which is ~5.8%/16.5 gross/annualised spread, when...

David Blennerhassett

C.P. Pokphand’s Privatisation Bid from CPF

CPP announced a privatisation offer from CPF at HK$1.15 cash for each scheme share. Overall, we think the offer price is attractive and that the...

Arun George

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