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/chindata-group-holdings-adr" target="_blank" data-smartkarma-citation="entities:29274:1" rel="noopener">Chindata Group (CD US)</a>’s US$8.60 per ADS offer from Bain Capital is conditional on dissenting shareholders representing less than 12% of outstanding shares. </li>
<li>Oasis Management, an activist fund, <a href="https://investor.chindatagroup.com/static-files/87aad398-55ac-469c-959f-849e42247988" target="_blank" rel="noopener">recently disclosed</a> a shareholding representing 65.9 million ordinary shares, 8.99% of outstanding shares and 1.24% of voting interest. </li>
<li>Precedent transactions where the dissent condition was exceeded suggest two possibilities – the offeror waives the condition or persuades sufficient shareholders to withdraw as dissenters.</li>
</ul>



Chindata Group (CD US)’s US$8.60 per ADS offer from Bain Capital is conditional on dissenting shareholders representing less than 12% of outstanding shares. 
Oasis Management, an activist fund, recently disclosed a shareholding representing 65.9 million ordinary shares, 8.99% of outstanding shares and 1.24% of voting interest. 
Precedent transactions where the dissent condition was exceeded suggest two possibilities – the offeror waives the condition or persuades sufficient shareholders to withdraw as dissenters.


Chindata (CD US): Maximum Dissent Condition in Focus as Oasis Builds a Stake

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

First Trust Dj Internet Ind / Technical Analysis

<ul>
<li>Last week (8/22/23) we discussed our expectations for an oversold bounce due to an overwhelming number of indexes/Sectors/industries testing multi-month supports, combined with Treasury yields and the DXY testing resistance.</li>
<li>The bounce has begun with the SPP ending higher last week for the first time in a month, and it is possible we have seen the lows for this pause/pullback.</li>
<li>A meaningful correction cannot happen if the SPX is above 4300-4325, but we would not be surprised to see another month or more of consolidation between 4300 and 4600.</li>
</ul>


Last week (8/22/23) we discussed our expectations for an oversold bounce due to an overwhelming number of indexes/Sectors/industries testing multi-month supports, combined with Treasury yields and the DXY testing resistance.
The bounce has begun with the SPP ending higher last week for the first time in a month, and it is possible we have seen the lows for this pause/pullback.
A meaningful correction cannot happen if the SPX is above 4300-4325, but we would not be surprised to see another month or more of consolidation between 4300 and 4600.


Oversold Bounce Underway Amid Consolidation Phase; Buys in IT Consulting, Uranium, Technology

<ul>
<li>
<a href="https://www.smartkarma.com/entities/chindata-group-holdings-adr" target="_blank" data-smartkarma-citation="entities:29274:1" rel="noopener">Chindata Group (CD US)</a> has entered a definite agreement with Bain Capital at US$8.60 per ADS, 7.5% higher than its previous offer of US$8.00 per ADS.</li>
<li>Completion is conditional on shareholder approval, dissenting shareholders representing less than 12% of outstanding shares and any applicable regulatory approvals. The completion conditions should be met.</li>
<li>CMC’s offer, while higher, does not meet the "<em>superior proposal</em>" criterion. At the last close price and December-end completion, the gross and annualised spread is 6.0% and 16.6%, respectively.</li>
</ul>



Chindata Group (CD US) has entered a definite agreement with Bain Capital at US$8.60 per ADS, 7.5% higher than its previous offer of US$8.00 per ADS.
Completion is conditional on shareholder approval, dissenting shareholders representing less than 12% of outstanding shares and any applicable regulatory approvals. The completion conditions should be met.
CMC’s offer, while higher, does not meet the "superior proposal" criterion. At the last close price and December-end completion, the gross and annualised spread is 6.0% and 16.6%, respectively.


Chindata (CD US): Bain’s Binding Proposal at US$8.60 Per ADS

<ul>
<li>China Merchants Capital (CMC) <a href="https://en.cmcapital.com.cn/list/669" target="_blank" rel="noopener">disclosed</a> a competing preliminary non-binding proposal to acquire <a href="https://www.smartkarma.com/entities/chindata-group-holdings-adr" target="_blank" data-smartkarma-citation="entities:29274:1" rel="noopener">Chindata Group (CD US)</a> at US$9.20 per ADS, a 15.0% premium to Bain Capital’s US$8.00 per ADS offer.</li>
<li>Astonishingly, Chindata did not publicly disclose the CMC offer, which was sent to the special committee on 9 June, i.e., 34 days ago.</li>
<li>CMC must get Bain Capital’s support due to its 92.34% voting rights. The presence of a credible competing proposal will require Bain Capital to match CMC’s offer.</li>
</ul>


China Merchants Capital (CMC) disclosed a competing preliminary non-binding proposal to acquire Chindata Group (CD US) at US$9.20 per ADS, a 15.0% premium to Bain Capital’s US$8.00 per ADS offer.
Astonishingly, Chindata did not publicly disclose the CMC offer, which was sent to the special committee on 9 June, i.e., 34 days ago.
CMC must get Bain Capital’s support due to its 92.34% voting rights. The presence of a credible competing proposal will require Bain Capital to match CMC’s offer.


Chindata (CD US): China Merchants Capital’s Rival Privatisation Offer

Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

NTT (Nippon Telegraph & Telephone) / Equity Bottom-Up

<ul>
<li>NTT's global data center business has 6% market share with annual revenue growth of 20% that is twice the industry average</li>
<li>We have updated our model and valuation summary to reflect the transfer of NTT Ltd, which operates the GDC business, into NTT Data</li>
<li>Our valuation remains unchanged although we have lowered our target price ¥4,500 to ¥4,450 for payment of the H1 dividend.  NTT remains a top pick in our coverage</li>
</ul>


NTT's global data center business has 6% market share with annual revenue growth of 20% that is twice the industry average
We have updated our model and valuation summary to reflect the transfer of NTT Ltd, which operates the GDC business, into NTT Data
Our valuation remains unchanged although we have lowered our target price ¥4,500 to ¥4,450 for payment of the H1 dividend.  NTT remains a top pick in our coverage


NTT (Buy) - Investor Day Highlights Global Data Center Business

United States

Equinix Inc is a global colocation company offering data center space and power to customers. The Company centers offer direct interconnections to network providers, cloud service providers, and other customers. Equinix has extensive operations in North America, Europe, Asia, Dubai, and Brazil.

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Equinix Inc (EQIX US)

Chindata (CD US): Maximum Dissent Condition in Focus as Oasis Builds a Stake

The transaction received shareholder approval. Dissenting shareholders represent 22.79% of outstanding shares vs. the requirement of less than 12%...

Arun George

Oversold Bounce Underway Amid Consolidation Phase; Buys in IT Consulting, Uranium, Technology

Our 8/22 expectations for oversold bounce coming to fruition as major multi-month supports hold $SPX $DJI $XLK $ACWI, & Treasury yields $TNX $TYX...

Vermilion Research

Chindata (CD US): Bain’s Binding Proposal at US$8.60 Per ADS

Bain's revised offer is still unattractive, but the completion conditions should be met. At the last close price and December-end completion, the...

Arun George

Chindata (CD US): China Merchants Capital’s Rival Privatisation Offer

CMC must get Bain Capital’s support due to its 92.34% voting rights. The presence of a credible competing proposal will require Bain Capital to...

Arun George

NTT (Buy) - Investor Day Highlights Global Data Center Business

NTT’s data center business is growing 20%+/year before currency tailwinds as the NTT Data integration kicks off. We have updated our model and SOTP...

Kirk Boodry

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