Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>MBK Partners will launch a tender offer for ConnectWave from today to May 24th. The target volume is 16.6M shares (40% of SO) at ₩18,000 per share, a 15.6% premium.</li>
<li>MBK commits to acquiring all tendered shares, regardless of subscription rates, in order to expedite the delisting process. So, there is no cancellation or allocation risk.</li>
<li>ConnectWave's retail investor base, with high entry prices, may hinder reaching 70% of the target volume. Absence of risks suggests considering buy positions for potential secondary tender offer.</li>
</ul>


MBK Partners will launch a tender offer for ConnectWave from today to May 24th. The target volume is 16.6M shares (40% of SO) at ₩18,000 per share, a 15.6% premium.
MBK commits to acquiring all tendered shares, regardless of subscription rates, in order to expedite the delisting process. So, there is no cancellation or allocation risk.
ConnectWave's retail investor base, with high entry prices, may hinder reaching 70% of the target volume. Absence of risks suggests considering buy positions for potential secondary tender offer.


MBK's ConnectWave Tender Offer: Details & Trading Angles

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 href="https://www.smartkarma.com/entities/hlb-therapeutics-co-ltd" target="_blank" data-smartkarma-citation="entities:1933:1" rel="noopener">HLB Therapeutics (115450 KS)</a> will replace <a href="https://www.smartkarma.com/entities/jeisys-medical-inc" target="_blank" data-smartkarma-citation="entities:36766:1" rel="noopener">Jeisys Medical (287410 KS)</a> in the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a> next week.</li>
<li>Passive trackers will need to buy 1.8 days of ADV in <a href="https://www.smartkarma.com/entities/hlb-therapeutics-co-ltd" target="_blank" data-smartkarma-citation="entities:1933:1" rel="noopener">HLB Therapeutics (115450 KS)</a> and sell over 4 days of ADV in <a href="https://www.smartkarma.com/entities/jeisys-medical-inc" target="_blank" data-smartkarma-citation="entities:36766:1" rel="noopener">Jeisys Medical (287410 KS)</a>. </li>
<li>Recent ad hoc inclusions to the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a> have jumped post announcement of index inclusion but have sold off after the inclusion.</li>
</ul>



HLB Therapeutics (115450 KS) will replace Jeisys Medical (287410 KS) in the KOSDAQ 150 Index (KOSDQ150 INDEX) next week.
Passive trackers will need to buy 1.8 days of ADV in HLB Therapeutics (115450 KS) and sell over 4 days of ADV in Jeisys Medical (287410 KS). 
Recent ad hoc inclusions to the KOSDAQ 150 Index (KOSDQ150 INDEX) have jumped post announcement of index inclusion but have sold off after the inclusion.


KOSDAQ150 Index Adhoc Rebalance: HLB Therapeutics Replaces Jeisys Medical

<ul>
<li>Jeisys Medical’s getting booted from the KOSDAQ 150, and HLB Therapeutics is stepping in as the new addition. This change will officially hit the book on Wednesday, September 25.</li>
<li>HLB Therapeutics, with a ₩0.70T market cap and 87% float, is set for a 0.51% weight in KOSDAQ 150, triggering over 2 million shares in passive buying: 3.26x 30-day ADTV.</li>
<li>With today’s after-hours volume spike in HLB Therapeutics, we’re likely to see some price action from early movers spilling into Monday’s open, similar to what we saw with Webzen.</li>
</ul>


Jeisys Medical’s getting booted from the KOSDAQ 150, and HLB Therapeutics is stepping in as the new addition. This change will officially hit the book on Wednesday, September 25.
HLB Therapeutics, with a ₩0.70T market cap and 87% float, is set for a 0.51% weight in KOSDAQ 150, triggering over 2 million shares in passive buying: 3.26x 30-day ADTV.
With today’s after-hours volume spike in HLB Therapeutics, we’re likely to see some price action from early movers spilling into Monday’s open, similar to what we saw with Webzen.


Will New KOSDAQ 150 Member HLB Therapeutics Show Webzen-Like Price Moves?

<ul>
<li>Archimed, via its Korean entity Syracuse Subco, now holds 91.35% of <a href="https://www.smartkarma.com/entities/jeisys-medical-inc" target="_blank" data-smartkarma-citation="entities:36766:1" rel="noopener">Jeisys Medical (287410 KS)</a> following the second tender offer. <a href="https://www.smartkarma.com/entities/jeisys-medical-inc" target="_blank" data-smartkarma-citation="entities:36766:1" rel="noopener">Jeisys</a> shares will be delisted in the next couple months.</li>
<li>
<a href="https://www.smartkarma.com/entities/jeisys-medical-inc" target="_blank" data-smartkarma-citation="entities:36766:1" rel="noopener">Jeisys Medical (287410 KS)</a> is a <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a> constituent and there will be a replacement for the stock in the index.</li>
<li>Recent ad hoc replacements to the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a> have traded well and that warrants positioning for this event.</li>
</ul>


Archimed, via its Korean entity Syracuse Subco, now holds 91.35% of Jeisys Medical (287410 KS) following the second tender offer. Jeisys shares will be delisted in the next couple months.

Jeisys Medical (287410 KS) is a KOSDAQ 150 Index (KOSDQ150 INDEX) constituent and there will be a replacement for the stock in the index.
Recent ad hoc replacements to the KOSDAQ 150 Index (KOSDQ150 INDEX) have traded well and that warrants positioning for this event.


KOSDAQ150 Index Adhoc Rebalance Preview: Replacements for Jeisys Medical

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/webzen-inc" target="_blank" data-smartkarma-citation="entities:12799:1" rel="noopener">Webzen Inc (069080 KS)</a> will replace <a href="https://www.smartkarma.com/entities/connectwave-co-ltd" target="_blank" data-smartkarma-citation="entities:7191:1" rel="noopener">Connectwave (119860 KS)</a> in the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a> effective 16 August.</li>
<li>There is over 2 days of ADV to trade on both stocks though the flows are not very large.</li>
<li>The <a href="https://www.smartkarma.com/entities/connectwave-co-ltd" target="_blank" data-smartkarma-citation="entities:7191:1" rel="noopener">Connectwave (119860 KS)</a> delisting will also have an impact on the changes to the KRX New Deal Internet Index in September.</li>
</ul>



Webzen Inc (069080 KS) will replace Connectwave (119860 KS) in the KOSDAQ 150 Index (KOSDQ150 INDEX) effective 16 August.
There is over 2 days of ADV to trade on both stocks though the flows are not very large.
The Connectwave (119860 KS) delisting will also have an impact on the changes to the KRX New Deal Internet Index in September.


KOSDAQ150 Adhoc Index Rebalance: Webzen to Replace Connectwave

South Korea

Connectwave Co., Ltd. operates as an online shopping portal site. The Company provides price comparing and shopping information providing service. Connectwave also generates income from advertisement.

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Connectwave (119860 KS)

MBK's ConnectWave Tender Offer: Details & Trading Angles

KRX plans to implement an ad-hoc change to the KOSDAQ 150 due to the delisting of ConnectWave (119860). ConnectWave (119860) will be removed from...

Sanghyun Park

KOSDAQ150 Index Adhoc Rebalance: HLB Therapeutics Replaces Jeisys Medical

HLB Therapeutics will replace Jeisys Medical in the KOSDAQ150 Index next week. Passives need to buy 1.8x ADV and sell 4x ADV. Historically, ad hoc...

Brian Freitas

Will New KOSDAQ 150 Member HLB Therapeutics Show Webzen-Like Price Moves?

This post covers the KOSDAQ 150 ad-hoc change, where HLB Therapeutics replaces Jeisys Medical, and explores whether HLB Therapeutics will...

Sanghyun Park

KOSDAQ150 Index Adhoc Rebalance Preview: Replacements for Jeisys Medical

Archimed holds 91.35% of the shares in Jeisys Medical. With trading halted in Jeisys, the KRX could announce a replacement for the KOSDAQ150 Index....

Brian Freitas

KOSDAQ150 Adhoc Index Rebalance: Webzen to Replace Connectwave

Webzen will replace Connectwave in the KOSDAQ150 Index effective 16 August. Passives need to trade over 2x ADV in both stocks. There are...

Brian Freitas

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