Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Schemes In HK can and will fail. But rarely like <strong><a href="https://www.smartkarma.com/entities/golden-throat-holdings-group" target="_blank" data-smartkarma-citation="entities:22664:1" rel="noopener">Golden Throat (6896 HK)</a> </strong>did. And not one that was ostensibly pitched at a fair price. </li>
<li>A staggering 55.656mn or 68.875% of Disinterested Shareholders in person or via proxy voted <em><a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1130/2021113001688.pdf" target="_blank" rel="noopener">against</a></em> the Scheme. That's also ~7.5% of total shares out. </li>
<li>There was insider trading on the 5 August. Shares declined 6% in two trading days ahead of the vote. Plus 68mn shares moved out of CCASS. Something is not right.</li>
</ul>


Schemes In HK can and will fail. But rarely like Golden Throat (6896 HK) did. And not one that was ostensibly pitched at a fair price. 
A staggering 55.656mn or 68.875% of Disinterested Shareholders in person or via proxy voted against the Scheme. That's also ~7.5% of total shares out. 
There was insider trading on the 5 August. Shares declined 6% in two trading days ahead of the vote. Plus 68mn shares moved out of CCASS. Something is not right.


Golden Throat (6896 HK): This One Left A Bitter Aftertaste

<ul>
<li>
<a href="https://www.smartkarma.com/entities/razer-inc" target="_blank" data-smartkarma-citation="entities:24380:1" rel="noopener">Razer Inc (1337 HK)</a> has announced a pre-conditional <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1202/2021120200081.pdf" target="_blank" rel="noopener">Scheme</a> from its founders and CVC at HK$2.82/share, a 55.8% premium to the undisturbed price. The Offer price will NOT be increased.</li>
<li>The Founder Group holds 56.77%. Disinterested Shareholders comprise 42.78%. The blocking stake at the Scheme Meeting is 4.278% of shares out. </li>
<li>The pre-conditions include PRC anti-trust approval. This <em>should</em> not be an issue. But timing is the key risk to the deal. No dividends will be paid before the Effective Date. </li>
</ul>



Razer Inc (1337 HK) has announced a pre-conditional Scheme from its founders and CVC at HK$2.82/share, a 55.8% premium to the undisturbed price. The Offer price will NOT be increased.
The Founder Group holds 56.77%. Disinterested Shareholders comprise 42.78%. The blocking stake at the Scheme Meeting is 4.278% of shares out. 
The pre-conditions include PRC anti-trust approval. This should not be an issue. But timing is the key risk to the deal. No dividends will be paid before the Effective Date. 


<div>
<p>On the 12 August  <a href="https://www.smartkarma.com/entities/golden-throat-holdings-group" target="_blank" data-smartkarma-citation="entities:22664:1" rel="noopener">Golden Throat Holdings (6896 HK)</a>, a leading manufacturer of lozenges in China,  <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0812/2021081200754.pdf" target="_blank" rel="noopener">announced</a> an Offer from PE outfit Affirma, by way of a Scheme, at HK$2.80/share, a 55.6% premium to the undisturbed price. The Offer Price would not be increased. </p>
</div>
<div>
<p>Both the Founder Group (61.33% of shares out) and Rollover Shareholders (12.57%) have given Affirma irrevocables, but all will need to abstain from voting at the Court Meeting.</p>
<p>This Offer looked done and the gross spread has been gradually declining over time. </p>
<p>The Scheme Document is now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1029/2021102900193.pdf" target="_blank" rel="noopener">out</a>. The Court Meeting will be held on the 30 November with expected payment on the 21 December, one week earlier than my initial forecast. The IFA considers the Offer to be fair and reasonable. </p>
</div>
<div>
<p>More below the fold.</p>
</div>


On the 12 August  Golden Throat Holdings (6896 HK), a leading manufacturer of lozenges in China,  announced an Offer from PE outfit Affirma, by way of a Scheme, at HK$2.80/share, a 55.6% premium to the undisturbed price. The Offer Price would not be increased. 


Both the Founder Group (61.33% of shares out) and Rollover Shareholders (12.57%) have given Affirma irrevocables, but all will need to abstain from voting at the Court Meeting.
This Offer looked done and the gross spread has been gradually declining over time. 
The Scheme Document is now out. The Court Meeting will be held on the 30 November with expected payment on the 21 December, one week earlier than my initial forecast. The IFA considers the Offer to be fair and reasonable. 


More below the fold.


Golden Throat (6896 HK): Scheme Doc Out. Court Meeting On 30 November

<div>
<p>Following a <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0805/2021080500377.pdf" target="_blank" rel="noopener">suspension</a> "<em>pursuant to the Code of Takeovers and Mergers</em>" on the 5 August  <a href="https://www.smartkarma.com/entities/golden-throat-holdings-group" target="_blank" data-smartkarma-citation="entities:22664:1" rel="noopener">Golden Throat Holdings (6896 HK)</a>, a leading manufacturer of lozenges in China, has now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0812/2021081200754.pdf" target="_blank" rel="noopener">announced</a> an Offer from PE outfit Affirma, by way of a Scheme, at HK$2.80/share, a 55.6% premium to the undisturbed price.</p>
<p>The Offer Price will not be increased. Golden Throat does not intend to declare any dividends during the Offer period. </p>
<p>Both the Founder Group and Rollover Shareholders have given Affirma irrevocables.</p>
<p>The Founder Group collectively holds 457,076,300 shares or 61.33% of shares out. These shares form part of the Scheme shares. The Rollover Shareholders collectively hold 92,956,400 shares or 12.57% of shares out.</p>
</div>
<p>Standard Scheme conditions apply. None of the Founder Shareholders nor the Rollover Shareholders will attend or vote at the Court Meeting to approve the Scheme, nor vote at the General Meeting on the ordinary resolution to approve the Rollover Arrangement.</p>
<div>
<p>This Offer looks done.</p>
</div>
<div>
<p>More below the fold.</p>
</div>


Following a suspension "pursuant to the Code of Takeovers and Mergers" on the 5 August  Golden Throat Holdings (6896 HK), a leading manufacturer of lozenges in China, has now announced an Offer from PE outfit Affirma, by way of a Scheme, at HK$2.80/share, a 55.6% premium to the undisturbed price.
The Offer Price will not be increased. Golden Throat does not intend to declare any dividends during the Offer period. 
Both the Founder Group and Rollover Shareholders have given Affirma irrevocables.
The Founder Group collectively holds 457,076,300 shares or 61.33% of shares out. These shares form part of the Scheme shares. The Rollover Shareholders collectively hold 92,956,400 shares or 12.57% of shares out.

Standard Scheme conditions apply. None of the Founder Shareholders nor the Rollover Shareholders will attend or vote at the Court Meeting to approve the Scheme, nor vote at the General Meeting on the ordinary resolution to approve the Rollover Arrangement.

This Offer looks done.


More below the fold.


Golden Throat (6896 HK): Affirma and Founder Group Cough Up

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/golden-throat-holdings-group" target="_blank" data-smartkarma-citation="entities:22664:1" rel="noopener">Golden Throat Holdings (6896 HK)</a> is a leading manufacturer of lozenges in China. After market close on Thursday, it announced a privatisation offer by way of a scheme of arrangement from Aureli Investments. The offeror will offer HK$2.80 cash per scheme share. The bid represents a premium of 55.6% over the closing price of HK$1.80 per share on the undisturbed date (4 August 2021 prior to irregular price movements) and a premium of 25.6% over the closing price of HK$2.23 per share on the last trading date (5 August 2021 prior to the trading halt). </p><p>On 10 August, Golden Throat issued a positive profit alert. The 1H21 net profit is expected to be around RMB80.0 million in comparison to the 1H20 net profit of RMB15.8 million. The profit increase was due to a recovery in 1H21 sales to the pre-COVID-19 pandemic levels. </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 189.3 million shares or 25.60% of shares outstanding, the 10% blocking stake is 18.9 million shares or 2.56% 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>

Golden Throat Holdings (6896 HK) is a leading manufacturer of lozenges in China. After market close on Thursday, it announced a privatisation offer by way of a scheme of arrangement from Aureli Investments. The offeror will offer HK$2.80 cash per scheme share. The bid represents a premium of 55.6% over the closing price of HK$1.80 per share on the undisturbed date (4 August 2021 prior to irregular price movements) and a premium of 25.6% over the closing price of HK$2.23 per share on the last trading date (5 August 2021 prior to the trading halt). On 10 August, Golden Throat issued a positive profit alert. The 1H21 net profit is expected to be around RMB80.0 million in comparison to the 1H20 net profit of RMB15.8 million. The profit increase was due to a recovery in 1H21 sales to the pre-COVID-19 pandemic levels. 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 189.3 million shares or 25.60% of shares outstanding, the 10% blocking stake is 18.9 million shares or 2.56% 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. 

Hong Kong

Natural Beauty Bio-Technology Limited researches and develops, manufactures and sells aroma therapeutic, beauty and skin care products, marketed and distributes through a sales network in China. The Company also provides skin treatments and SPA services through its beauty centers offering tailor-made equipment by the pr ofessional beauticians.

Ming Fai International Holdings Limited manufactures and supplies amenity products and accessories to the hotel, hospitality, and travel industries. The Company's products include personal healthcare and other in-room accessories and airline amenity kits and accessories.

HIN Sang Group International Holding Co., Ltd. sells and distributes personal care products, health care products and household products purchased from authorized dealers and independent traders and sold onward to small independent pharmacy stores in Hong Kong.

Hin Sang Group International Hldg (6893 HK)

Zhongzheng International Company Limited, through its subsidiaries, manufactures and sells healthcare and household products. The Company also provides internet-related services and develops and sells enterprise application software. Zhongzheng International provides services in Hong Kong.

Shunten International (Holdings) Limited operates as a health care products distribution company. The Company sales health products, beauty supplements products, and other products. Shunten International (Holdings) also provides online advertising agency and online payment services.

Lam Soon (Hong Kong) Limited, through its subsidiaries, manufactures and distributes a range of food products, including flour, edible oils and vegetable fats. The Company also manufactures and distributes household cleaning products, including dishwashing detergent, laundry powder, fabric softener, and floor cleanser.

China Starch Holdings Limited manufactures cornstarch. The Company also manufactures L-lysine hydrochloride salt and other ancillary corn-refined and corn-base products such as corn slurry, corn germ, corn fiber, corn glutten meal, and agricultural fertilizers.

Tibet Water Resources Ltd. produces branded premium bottled mineral water. The Company is focused on institutional sales such as rail transport operators, commercial banks, airlines, government organizations, and other major corporations in China.

Four Seas Mercantile Holdings Limited, through its subsidiaries, manufactures and trades snack foods, confectionery, beverages, and frozen food products. The Company also manufactures and sells ham and ham related products.

Vedan International (Holdings) Limited manufactures and sells fermentation-based food additive and biochemical products, cassava starch-based industrial products, specialty chemical products, and beverages.

COTA CO., LTD. manufactures and sells hair care products.  The Company offers an extensive line of perm, coloring, styling, and treatment products.

Nature's Sunshine Products, Inc. manufactures and distributes nutritional and personal care products.  The Company's products include herbal products, vitamins, homeopathics, oils and lotions, aloe vera gel, herbal shampoo, toothpaste, and skin cleanser.  Nature's Sunshine markets its products in the United States and internationally.

Henan Rebecca Hair Products Co., Ltd. manufactures wigs, fiber hair, and hair pieces used for hair styling, hair extension, and training purposes in beauty salons. The Company exports its products mainly to the United States and Europe.

Henan Rebecca Hair Products Co., (600439 CH)

YA-MAN LTD. is a manufacturer of home facial equipment, and also sells its facial massager, cosmetics and laundry.

Liuzhou Liangmianzhen Co., Ltd. manufactures and markets oral hygiene products, cleaning products and feminine hygiene products. The company's main products include a variety of toothpaste with ingredients from traditional Chinese medicines. Liuzhou Liangmianzhen uses LMZ brand name.

Liuzhou Liangmianzhen Co, Ltd. (600249 CH)

Perfect Group Corp., Ltd. manufactures oral cleaning care products. The Company produces and sells toothbrushes, flosses, mouthwashes, oral spray, wipes, toothpastes, and other products. Perfect Group markets its products throughout China.

MANDOM CORPORATION manufactures and markets a variety of cosmetic products for men and women.  The Company's products include hair care and skin care cosmetics.

Shanghai Jiaoda Onlly Co., Ltd. develops, manufactures, and markets biological products, healthcare food, ginseng products, and other nutritional supplements. Through its subsidiaries, the Company also provides advertising, medical, travel, and food services.

Chlitina Holding Limited manufactures, markets, and distributes beauty and skin care products. The company promotes its business through franchise chain stores.

Cupid Ltd. manufactures and markets condoms. The Company sells its products in India and elsewhere throughout the world.

Golden Throat Holdings Group Company Limited manufactures throat lozenges.  The Company offers its products throughout China.

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Golden Throat Holdings (6896 HK)

Golden Throat (6896 HK): This One Left A Bitter Aftertaste

There is something totally off about this deal. Currently trading at $1.60/share, 11.1% below the "true" undisturbed price. I wouldn't touch this....

David Blennerhassett

Golden Throat (6896 HK): Scheme Doc Out. Court Meeting On 30 November

The current gross/annualised spread (at HK$2.70/share as I type) is 3.7%/28.5%. That looks attractive although it is not a super liquid arb situation.

David Blennerhassett

Golden Throat (6896 HK): Affirma and Founder Group Cough Up

Assuming this completes late-December, the current gross/annualised spread is 8.1%/23.1%. This still looks like an attractive opportunity, although...

David Blennerhassett

Golden Throat’s Privatisation Bid

Golden Throat announced a privatisation offer at HK$2.80 cash per scheme share, a 25.6% premium to the last close. We think the offer price is...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Golden Throat (6896 HK): This One Left A Bitter Aftertaste

There is something totally off about this deal. Currently trading at $1.60/share, 11.1% below the "true" undisturbed price. I wouldn't touch this....

David Blennerhassett

Razer (1337 HK): $2.82/Share Final Offer

I'd be a buyer up to $2.50/share or 13%/27% gross/annualised. That may seem wide, but given Hong Kong's M&A bloodbath this year, this seems a...

David Blennerhassett

Golden Throat (6896 HK): Scheme Doc Out. Court Meeting On 30 November

The current gross/annualised spread (at HK$2.70/share as I type) is 3.7%/28.5%. That looks attractive although it is not a super liquid arb situation.

David Blennerhassett

Golden Throat (6896 HK): Affirma and Founder Group Cough Up

Assuming this completes late-December, the current gross/annualised spread is 8.1%/23.1%. This still looks like an attractive opportunity, although...

David Blennerhassett

Golden Throat’s Privatisation Bid

Golden Throat announced a privatisation offer at HK$2.80 cash per scheme share, a 25.6% premium to the last close. We think the offer price is...

Arun George