Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On Friday, post-close, there was a flurry of excitement as YFO put out a press release amending the start date of the planned Tender Offer to early November.</li>
<li>Not long after, there was another release by <a href="https://www.smartkarma.com/entities/toyo-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:1176:1" rel="noopener">Toyo Construction (1890 JP)</a> itself. </li>
<li>You have to read both for what they are. And as they say.... Get your programs here!</li>
</ul>


On Friday, post-close, there was a flurry of excitement as YFO put out a press release amending the start date of the planned Tender Offer to early November.
Not long after, there was another release by Toyo Construction (1890 JP) itself. 
You have to read both for what they are. And as they say.... Get your programs here!


Toyo Construction (1890 JP) - There's Nuance in Them Thar Press Releases

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

<ul>
<li>JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.</li>
<li>A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.</li>
<li>Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in <em>August 2023</em> based on trading data as of end-<em>August 2022</em>.</li>
</ul>


JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2023 based on trading data as of end-August 2022.


NTT (Nippon Telegraph & Telephone) / Event-Driven

<ul>
<li>The last of the three-leg rebalance for TOPIX and JPNK400 index weights takes place Wednesday 29 June at the close. This one is a bit larger than expected in April.</li>
<li>There were a large number of cancellations of shares by TSE Prime members in May which ups the predicted value to be traded. </li>
<li>Interestingly, because lots of names have seen share cancellations and FFW drops, the average passive ownership of TSE Float (not other providers' float) has gone up significantly through this process. </li>
</ul>


The last of the three-leg rebalance for TOPIX and JPNK400 index weights takes place Wednesday 29 June at the close. This one is a bit larger than expected in April.
There were a large number of cancellations of shares by TSE Prime members in May which ups the predicted value to be traded. 
Interestingly, because lots of names have seen share cancellations and FFW drops, the average passive ownership of TSE Float (not other providers' float) has gone up significantly through this process. 


Last Leg of TOPIX and JPNK400 FFW Rebal - ¥780bn One-Way Flow Wednesday

<ul>
<li>Three weeks ago, Yamauchi No 10 Family Office (YFO) announced its intentions to launch a Tender Offer by end-June. <a href="https://www.smartkarma.com/entities/toyo-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:1176:1" rel="noopener">Toyo Construction (1890 JP)</a> got upset and called YFO names.</li>
<li>TC announced a Poison Pill, they talked, TC accused YFO in the AGM Convocation of "extreme dishonesty." They have since met again, and finally signed a long standstill agreement. </li>
<li>But the Poison Pill will be put to shareholders (ISS recommends against), and shareholders have to decide from the public documents whether they believe Toyo Construction. </li>
</ul>


Three weeks ago, Yamauchi No 10 Family Office (YFO) announced its intentions to launch a Tender Offer by end-June. Toyo Construction (1890 JP) got upset and called YFO names.
TC announced a Poison Pill, they talked, TC accused YFO in the AGM Convocation of "extreme dishonesty." They have since met again, and finally signed a long standstill agreement. 
But the Poison Pill will be put to shareholders (ISS recommends against), and shareholders have to decide from the public documents whether they believe Toyo Construction. 


Toyo Construction - YFO Standstill Against TC Hostility

<ul>
<li>
<a href="https://www.smartkarma.com/entities/toyo-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:1176:1" rel="noopener">Toyo Construction (1890 JP)</a> today released a change to its Target Opinion Statement for Infroneer's takeover bid at ¥770/share. It supports the tender itself, but withdraws its recommendation investors tender.</li>
<li>Infroneer refused to raise their price, so this effectively kills their bid (though they will extend). TC will engage with Yamauchi Family Office which has separately offered to bid ¥1,000/share.</li>
<li>The dynamics have now changed. This is a range trade, and will likely take time unless Infroneer says "I'll sell at ¥1,000/share."</li>
</ul>



Toyo Construction (1890 JP) today released a change to its Target Opinion Statement for Infroneer's takeover bid at ¥770/share. It supports the tender itself, but withdraws its recommendation investors tender.
Infroneer refused to raise their price, so this effectively kills their bid (though they will extend). TC will engage with Yamauchi Family Office which has separately offered to bid ¥1,000/share.
The dynamics have now changed. This is a range trade, and will likely take time unless Infroneer says "I'll sell at ¥1,000/share."


ToyoKen (1890)- Infroneer Declines to Bid Up, YFO Now In Driver's Seat - Now It's A Range Trade

Japan

INFRONEER Holdings Inc. offers infrastructure construction services. The Company provides energy construction, road construction, airport construction, exhibition hall construction, and more. INFRONEER Holdings also produces construction equipment.

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INFRONEER Holdings (5076 JP)

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