IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

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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/daiken-corp" target="_blank" data-smartkarma-citation="entities:15544:1" rel="noopener">Daiken Corp (7905 JP)</a> has recommended <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a>’s tender offer of JPY3,000 per share, a 28.8% premium to the undisturbed price (10 August).</li>
<li>The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the tender offer is set at a 31.83% ownership ratio.</li>
<li>The minimum acceptance condition (lower limit) requires a 50.0% minority acceptance rate (majority of minority condition). The tender offer is light vs historical multiples but represents a 5-year high price.</li>
</ul>



Daiken Corp (7905 JP) has recommended Itochu Corp (8001 JP)’s tender offer of JPY3,000 per share, a 28.8% premium to the undisturbed price (10 August).
The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the tender offer is set at a 31.83% ownership ratio.
The minimum acceptance condition (lower limit) requires a 50.0% minority acceptance rate (majority of minority condition). The tender offer is light vs historical multiples but represents a 5-year high price.


Daiken Corporation (7905 JP): Itochu's JPY3,000 Tender Offer

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Itochu owns 36.3% of building materials and engineering firm <a href="https://www.smartkarma.com/entities/daiken-corp" target="_blank" data-smartkarma-citation="entities:15544:1" rel="noopener">Daiken Corp (7905 JP)</a>. They have launched a tender with gimmicky Majority-of-Minority to buy the rest at ¥3,000/share, 4.7x FY2024e EBITDA. </li>
<li>That's low-ish, but given securities holdings, inventory, and net receivables at 4+x EBITDA it's probably too cheap, but it gets quite close to the minimum threshold just with cross-holders.</li>
<li>This deal price doesn't include synergies (according to the valuations and the SC) but a bump would need an agitator. Hope alone won't get it.</li>
</ul>


Itochu owns 36.3% of building materials and engineering firm Daiken Corp (7905 JP). They have launched a tender with gimmicky Majority-of-Minority to buy the rest at ¥3,000/share, 4.7x FY2024e EBITDA. 
That's low-ish, but given securities holdings, inventory, and net receivables at 4+x EBITDA it's probably too cheap, but it gets quite close to the minimum threshold just with cross-holders.
This deal price doesn't include synergies (according to the valuations and the SC) but a bump would need an agitator. Hope alone won't get it.


Itochu Takeout of Daiken (7905) - Too Low at ¥3,000/Share But May Be Tough To Oppose

Japan

DAIKEN CORPORATION manufactures mineral and wooden fiberboards.  The Company also makes special plywood for ships, rolling stock, and musical instruments. Daiken operates engineering services and real estate business.

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Daiken Corporation (7905 JP): Itochu's JPY3,000 Tender Offer

The lower limit requires a 50.0% minority acceptance rate (majority of minority condition). The tender offer is light vs historical multiples but...

Arun George

Itochu Takeout of Daiken (7905) - Too Low at ¥3,000/Share But May Be Tough To Oppose

Itochu is taking out its equity affiliate building materials and engineering firm Daiken (7905). Itochu lowballed, raised, the raised 3x more, but...

Travis Lundy