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

Japan Best Rescue System Co / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/japan-best-rescue-system-co" target="_blank" data-smartkarma-citation="entities:13367:1" rel="noopener">Japan Best Rescue System Co (2453 JP)</a>/JBR has recommended an MBK Partners-backed MBO tender offer of JPY1,000 per share, a 53.8% premium to the undisturbed price (13 November). </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 66.67% ownership ratio.</li>
<li>Irrevocables to accept the offer represent a 53.62% ownership ratio. The minimum acceptance condition requires a 28.1% minority acceptance rate, which is helped by the significant premium. </li>
</ul>



Japan Best Rescue System Co (2453 JP)/JBR has recommended an MBK Partners-backed MBO tender offer of JPY1,000 per share, a 53.8% premium to the undisturbed price (13 November). 
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 66.67% ownership ratio.
Irrevocables to accept the offer represent a 53.62% ownership ratio. The minimum acceptance condition requires a 28.1% minority acceptance rate, which is helped by the significant premium. 


Japan Best Rescue System (2453 JP): MBK Partners Backed MBO Tender Offer at JPY1,000

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>This MBO by MBK is a strong premium because of a low recent price, but it pays a low P/FCF multiple for growth, and no synergies counted.</li>
<li>Yet another MBO where insiders and friends take advantage of structural inferiority of minority shareholders. Something Should Be Done.</li>
<li>What do Minority Shareholders in Japan Say When They Meet Death? "OK, Today it is then." (with apologies to Game Of Thrones).</li>
</ul>


This MBO by MBK is a strong premium because of a low recent price, but it pays a low P/FCF multiple for growth, and no synergies counted.
Yet another MBO where insiders and friends take advantage of structural inferiority of minority shareholders. Something Should Be Done.
What do Minority Shareholders in Japan Say When They Meet Death? "OK, Today it is then." (with apologies to Game Of Thrones).


Japan Best Rescue (2453) MBO at ¥1,000; High Premium, Low Multiple, No Money For Synergies or Growth

David Blennerhassett

<ul>
<li>The Korean Financial Services Commission and the Financial Supervisory Service held a press briefing, unveiling the comprehensive prohibition of short selling from the 6th November, until June 30th next year.</li>
<li>Recco or Ascendant for <a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys (HOLI US)</a>? Ascendant could easily get &gt;50% of shares out, and spill the board. Recco, with no shares held, looks to have a weaker hand. </li>
<li>
<a href="https://www.smartkarma.com/entities/sankyo-co-ltd" target="_blank" data-smartkarma-citation="entities:12385:1" rel="noopener">Sankyo (6417 JP)</a> is cheap. It will never trade at 20x expected PER because of the nature of the business; right now, on an ex-cash basis, it trades 1.6x ex-cash PER.</li>
</ul>


The Korean Financial Services Commission and the Financial Supervisory Service held a press briefing, unveiling the comprehensive prohibition of short selling from the 6th November, until June 30th next year.
Recco or Ascendant for Hollysys (HOLI US)? Ascendant could easily get &gt;50% of shares out, and spill the board. Recco, with no shares held, looks to have a weaker hand. 

Sankyo (6417 JP) is cheap. It will never trade at 20x expected PER because of the nature of the business; right now, on an ex-cash basis, it trades 1.6x ex-cash PER.


Last Week in Event SPACE: Korea's Short Selling, Hollysys, Sankyo, Descente

<ul>
<li>
<a href="https://www.smartkarma.com/entities/descente-ltd" target="_blank" data-smartkarma-citation="entities:8225:1" rel="noopener">Descente Ltd (8114 JP)</a> saw Itochu report it had continued its streak of consecutive days of buying, extending it to 115. Now they own 44.1% of voting rights.</li>
<li>ANTA gave hints to the progress of Descente China in the Interim Results, and Q3 Operational Update. Descente analysts are 20% ahead of guidance, but they're probably low still. </li>
<li>Descente reports Q2 tomorrow. I expect the numbers and presentation to surprise at the Net Profit level. I expect a forecast revision. </li>
</ul>



Descente Ltd (8114 JP) saw Itochu report it had continued its streak of consecutive days of buying, extending it to 115. Now they own 44.1% of voting rights.
ANTA gave hints to the progress of Descente China in the Interim Results, and Q3 Operational Update. Descente analysts are 20% ahead of guidance, but they're probably low still. 
Descente reports Q2 tomorrow. I expect the numbers and presentation to surprise at the Net Profit level. I expect a forecast revision. 


Descente (8114) : Itochu Still Buying and ANTA Gives You Earnings Hints

<ul>
<li>The TOPIX October Free Float Weight Review details are out. This is the biggest FFW review of the year. This year, it's $11.3bn a side. </li>
<li>As discussed in <a href="https://www.smartkarma.com/insights/japan-post-bank-7182-the-october-topix-ffw-adjustment" target="_blank" data-smartkarma-citation="insights:110290" rel="noopener">Japan Post Bank (7182) - The October TOPIX FFW Adjustment</a>, JPB is the big buy. $2bn/23d of ADV. There is $2bn to buy of trading cos too.</li>
<li>There are lots of large names to trade in both directions. If you have interests to sell the buys and vice versa, it is good to know the flows.</li>
</ul>


The TOPIX October Free Float Weight Review details are out. This is the biggest FFW review of the year. This year, it's $11.3bn a side. 
As discussed in Japan Post Bank (7182) - The October TOPIX FFW Adjustment, JPB is the big buy. $2bn/23d of ADV. There is $2bn to buy of trading cos too.
There are lots of large names to trade in both directions. If you have interests to sell the buys and vice versa, it is good to know the flows.


October 2023 TOPIX Free Float Review - $22.6bn to Trade and JPB (7182) The Biggie

Japan

ITOCHU Corporation is a general trading firm handling textiles, wood, machinery, metals, food, chemicals, construction materials, commodities, and energy related products such as oil and gas. The Company operates around the world. Itochu diversifies by operating in satellite communication and data communication businesses.

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Itochu Corp (8001 JP)

Japan Best Rescue System (2453 JP): MBK Partners Backed MBO Tender Offer at JPY1,000

Irrevocables to accept the offer represent a 53.62% ownership ratio. The minimum acceptance condition requires a 28.1% minority acceptance rate,...

Arun George

Japan Best Rescue (2453) MBO at ¥1,000; High Premium, Low Multiple, No Money For Synergies or Growth

Another hour, another MBO. This time MBK doing an MBO on Japan Best Rescue, a great little rollup of subscription and insurance services. At a low...

Travis Lundy

Last Week in Event SPACE: Korea's Short Selling, Hollysys, Sankyo, Descente

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Descente (8114) : Itochu Still Buying and ANTA Gives You Earnings Hints

Descente reports tomorrow. Itochu reported a higher stake at the end of last week (115 days of buying in a row) and I expect they continue. I think...

Travis Lundy

October 2023 TOPIX Free Float Review - $22.6bn to Trade and JPB (7182) The Biggie

The TOPIX FFW trade approaches. 4+ trading days left. So far the Top 40 Buys vs Sells are +1+% since I wrote two weeks ago. Shin-Etsu/Ibiden is...

Travis Lundy

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