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.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cpmc-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10427:1" rel="noopener">CPMC Holdings (906 HK)</a> disclosed that <a href="https://www.smartkarma.com/entities/org-technology-co-ltd-a" target="_blank" data-smartkarma-citation="entities:17510:1" rel="noopener">ORG Technology Co., Ltd. A (002701 CH)</a>, the second-largest shareholder, is considering a competing voluntary conditional general cash offer.</li>
<li>It is rare to bid against an SOE bidder. ORG likely has implicit SOE support to launch a competing offer due to the need for Chinese regulatory approvals. </li>
<li>The possible scenarios suggest Mr Zhang Wei is the winning bid’s kingmaker. Mr Wei sold down 260K shares at HK$6.35 on 8 December, indicating a willingness to exit.</li>
</ul>



CPMC Holdings (906 HK) disclosed that ORG Technology Co., Ltd. A (002701 CH), the second-largest shareholder, is considering a competing voluntary conditional general cash offer.
It is rare to bid against an SOE bidder. ORG likely has implicit SOE support to launch a competing offer due to the need for Chinese regulatory approvals. 
The possible scenarios suggest Mr Zhang Wei is the winning bid’s kingmaker. Mr Wei sold down 260K shares at HK$6.35 on 8 December, indicating a willingness to exit.


CPMC Holdings (906 HK): Possible Scenarios as ORG Mulls a Competing Offer

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>In what I viewed as one of the cleaner deals, <a href="https://www.smartkarma.com/entities/cpmc-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10427:1" rel="noopener">CPMC Holdings (906 HK)</a> announced a pre-conditional Offer from SASAC and the National Council for Social Security Fund of China.</li>
<li>A decent premium to undisturbed, a low tendering threshold, and a large shareholder giving an irrevocable - this looked done. </li>
<li>Now ORG Development Limited/<a href="https://www.smartkarma.com/entities/org-technology-co-ltd-a" target="_blank" data-smartkarma-citation="entities:17510:1" rel="noopener">ORG Technology Co., Ltd. A (002701 CH)</a>, holding 24.4% of shares out, is mulling a competing conditional general cash Offer. One of these Offers will get up.</li>
</ul>


In what I viewed as one of the cleaner deals, CPMC Holdings (906 HK) announced a pre-conditional Offer from SASAC and the National Council for Social Security Fund of China.
A decent premium to undisturbed, a low tendering threshold, and a large shareholder giving an irrevocable - this looked done. 
Now ORG Development Limited/ORG Technology Co., Ltd. A (002701 CH), holding 24.4% of shares out, is mulling a competing conditional general cash Offer. One of these Offers will get up.


<ul>
<li>A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.</li>
<li>ECM developments - <a href="https://www.smartkarma.com/entities/rept-battero-energy" target="_blank" data-smartkarma-citation="entities:36626:1" rel="noopener">REPT BATTERO Energy (1998104D CH)</a> IPO and <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a>'s US$4.0 Billion Secondary Offering and US$1.4 Billion Buyback.</li>
<li>Event-Driven developments - <a href="https://www.smartkarma.com/entities/benefit-one-inc" target="_blank" data-smartkarma-citation="entities:14502:1" rel="noopener">Benefit One Inc (2412 JP)</a>, <a href="https://www.smartkarma.com/entities/tokyo-rakutenchi-co-ltd" target="_blank" data-smartkarma-citation="entities:2078:1" rel="noopener">Tokyo Rakutenchi (8842 JP)</a>, <a href="https://www.smartkarma.com/entities/cpmc-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10427:1" rel="noopener">CPMC Holdings (906 HK)</a>, <a href="https://www.smartkarma.com/entities/weiqiao-textile-co" target="_blank" data-smartkarma-citation="entities:3690:1" rel="noopener">Weiqiao Textile Co (2698 HK)</a>, <a href="https://www.smartkarma.com/entities/eoflow-co-ltd" target="_blank" data-smartkarma-citation="entities:36100:1" rel="noopener">Eoflow (294090 KS)</a>, <a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys Automation Technologies (HOLI US)</a>. </li>
</ul>


A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments - REPT BATTERO Energy (1998104D CH) IPO and Denso Corp (6902 JP)'s US$4.0 Billion Secondary Offering and US$1.4 Billion Buyback.
Event-Driven developments - Benefit One Inc (2412 JP), Tokyo Rakutenchi (8842 JP), CPMC Holdings (906 HK), Weiqiao Textile Co (2698 HK), Eoflow (294090 KS), Hollysys Automation Technologies (HOLI US). 


Weekly Deals Digest (10 Dec) - CPMC, Weiqiao, Benefit One, Tokyo Rakutenchi, Eoflow, Rept Battero

<ul>
<li>Packaging play <a href="https://www.smartkarma.com/entities/cpmc-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10427:1" rel="noopener">CPMC Holdings (906 HK)</a> has <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2023/1206/2023120601566.pdf" target="_blank" rel="noopener">announced</a> a pre-conditional Offer from SASAC and the National Council for Social Security Fund of China.</li>
<li>The joint offerors have offered $6.87/share, an okay 32.1% premium to last close. Pre-cons involve the standard PRC regulators. The Offer itself is contingent on a 50% acceptance hurdle. </li>
<li>
<a href="https://www.smartkarma.com/entities/china-foods-ltd" target="_blank" data-smartkarma-citation="entities:6077:1" rel="noopener">China Foods (506 HK)</a> has given an irrevocable for its 29.7% stake.  This will turn unconditional. The timing of the Offer is interesting as a VP is under graft investigation.</li>
</ul>


Packaging play CPMC Holdings (906 HK) has announced a pre-conditional Offer from SASAC and the National Council for Social Security Fund of China.
The joint offerors have offered $6.87/share, an okay 32.1% premium to last close. Pre-cons involve the standard PRC regulators. The Offer itself is contingent on a 50% acceptance hurdle. 

China Foods (506 HK) has given an irrevocable for its 29.7% stake.  This will turn unconditional. The timing of the Offer is interesting as a VP is under graft investigation.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/cpmc-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10427:1" rel="noopener">CPMC Holdings (906 HK)</a> has announced a pre-conditional voluntary offer from Changping Industrial at HK$6.87 per share, a 32.1% premium to the undisturbed price (16 August). </li>
<li>The pre-condition mainly relates to Chinese approvals. The offer is conditional on the offeror and concert parties representing more than 50% of voting rights.</li>
<li>The 50% minimum acceptance condition should be met due to COFCO’s irrevocable and the second-largest shareholders' past dealings with COFCO. At the last close, the gross spread was 6.0%.</li>
</ul>



CPMC Holdings (906 HK) has announced a pre-conditional voluntary offer from Changping Industrial at HK$6.87 per share, a 32.1% premium to the undisturbed price (16 August). 
The pre-condition mainly relates to Chinese approvals. The offer is conditional on the offeror and concert parties representing more than 50% of voting rights.
The 50% minimum acceptance condition should be met due to COFCO’s irrevocable and the second-largest shareholders' past dealings with COFCO. At the last close, the gross spread was 6.0%.


CPMC Holdings (906 HK): Pre-Conditional Voluntary Offer at HK$6.87

China

Shanghai Zi Jiang Enterprise Group Co., Ltd. manufactures and markets packaging materials.  The Company's products include PET (polyethylene terephthalate) bottles, caps and labels, aluminum-plated paper and paperboard, casted polypropylene (CPP) films, PE (polyethylene) curtain coating films, plastic anti-theft caps, and other related materials.

Shanghai Zijiang Enterprise Group (600210 CH)

Shenzhen Beauty Star Co., Ltd. manufactures and distributes plastic containers and plastic products. It also vacuum coats plastic products and content fills plastic tubes for cosmetics.

Shantou Dongfeng Printing Company Limited designs, manufactures and sells cigarette packet printings and related packaging materials. The Company's main products include cigarette packets used in cigarette brand packaging.

Jiangsu Shuangxing Color Plastic New Materials Company Limited develops, produces and sells plastic packaging materials. The Company's main product are polyester film, aluminized, PVC film, etc.

Jiangsu Shgxg Clr Plstc New Mtrls (002585 CH)

Shenzhen Jinjia Color Printing Group Co., Ltd. mainly designs trademarks, prints and manufactures standard cigarette boxes for cigarette companies. The Company is also engaged in printing other packaging materials.

Shenzhen Jinjia Color Printing Gp (002191 CH)

Huangshan Novel Co., Ltd. manufactures and markets color printed composite packaging products and vacuum aluminum coated products.

Shanghai Baosteel Packaging Co. Ltd., manufactures steel products. The Company also provides metal packaging services. Shanghai Baosteel Packaging serves customers and clients internationally.

Shanghai Baosteel Packaging-A (601968 CH)

ORG Technology Co., Ltd. develops, designs, manufactures and sells food and beverages metal packaging products. The Company's main products include food and beverage cans.

Sunrise Group Company Limited is a metal containers manufacturer. The Company produces cans and other metal packaging products.

Zhejiang Great Southeast Company Ltd. manufactures a wide range of plastic packaging products. The Company produces plastic film, plastic bags, and other plastic packaging.

Essel Propack Ltd. manufactures fully collapsible (soft squeeze) laminated tubes, flexible packaging and laminated paper. The Company's products are sold to pharmaceutical, consumer products and food packaging companies. Essel Propack's 100% owned subsidiary, Essel Overseas Ltd., is mainly engaged in export business.

Time Technoplast Limited manufactures and sells technology based polymer products for a wide variety of industries.

Cheng Loong Corp. manufactures, designs and markets paper products.  The Company produces a variety of papers, paper boxes, paper boards, office paper products, facial tissues, toilet paper, and paper towels.  The Company also develops real estate.

Zignago Vetro SpA produces glass bottles for the beverage and food market, cosmetic and perfumes markets. The Company also produces specialty glasses.

PT Fajar Surya Wisesa Tbk manufactures industrial paper such as container boards, boxboard, and coated paper for use in the packaging of consumer and industrial goods. The Company's products are sold locally and also exported to other Asian countries, Australia, and the Middle East.

Jai Corporation Ltd. manufactures galvanized plain and corrugated steel sheets; and polypropylene and polyethylene fabrics and sacks.

FP CORPORATION manufactures polystyrene and other synthetic resin food containers.  The Company produces a variety of products, including trays, lunch boxes, and other food containers.  FP also wholesales packing materials and machinery.  The Company focuses on recycle and environment friendly products.

FUJI SEAL INTERNATIONAL, INC. manufactures various packaging-related materials and machinery.  The Company's products include cap seals and labels and plastic containers.  Fuji Seal International also develops shrink wrap seals and tack labels.  The Company has production bases in the United States, England, Netherlands, and Thailand.

Cascades Inc. produces paper and packaging products.  The Company manufactures, converts, and markets specialty products, including boxboard, fine papers, tissue paper, and containerboard.  Cascades and its subsidiaries operate in Canada, the United States, France, Sweden, Germany, and Great Britain.

Youlchon Chemical Co., Ltd. develops and manufactures packaging materials such as single and multilayer oriented polypropylene films and corrugated cardboards for use in consumer product labeling and packaging applications.  The Company also produces laminated tubes to pack toothpaste, cosmetics, and adhesives.  In addition, Youlchon manufactures carrier tapes which carry electronic parts.

CPMC Holdings Ltd. manufactures food packaging products.

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CPMC Holdings (906 HK)