Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>Air New Zealand (AIR) was aiming to raise around US$827m (NZ$1.2bn) via a renounceable rights issue. It has now launched a shortfall of around US$153m, at last close.</li>
<li>We have covered the background of the rights and expected shortfall in our earlier note, <a href="https://www.smartkarma.com/insights/air-new-zealand-rights-and-possible-shortfall-delayed-boarding-but-its-priced-to-fly" target="_blank" data-smartkarma-citation="insights:67651" rel="noopener">Air New Zealand Rights and Possible Shortfall - Delayed Boarding but Its Priced to Fly</a>.</li>
<li>In this note, we talk about the recent updates and shortfall pricing.</li>
</ul>


Air New Zealand (AIR) was aiming to raise around US$827m (NZ$1.2bn) via a renounceable rights issue. It has now launched a shortfall of around US$153m, at last close.
We have covered the background of the rights and expected shortfall in our earlier note, Air New Zealand Rights and Possible Shortfall - Delayed Boarding but Its Priced to Fly.
In this note, we talk about the recent updates and shortfall pricing.


Air New Zealand Shortfall - Not a Great Take-Up Probably Because of the Large Retail Holding

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>The independent expert (IE) considers the offer to be fair and reasonable. We think that IE’s valuation approach is sound.  </li>
<li>The key condition is the scheme approval by shareholders. The scheme meeting is scheduled for 11 am on 3 February 2022 and the implementation date is 9 March 2022. </li>
<li>We continue to think that offer is attractive. At last close prices, the gross spread is 2.1% and the annualised spread to the implementation date is 9.9%. </li>
</ul>


The independent expert (IE) considers the offer to be fair and reasonable. We think that IE’s valuation approach is sound.  
The key condition is the scheme approval by shareholders. The scheme meeting is scheduled for 11 am on 3 February 2022 and the implementation date is 9 March 2022. 
We continue to think that offer is attractive. At last close prices, the gross spread is 2.1% and the annualised spread to the implementation date is 9.9%. 


Sydney Airport Scheme Meeting on 3 Feb 2022, IE Opinion

Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

<ul>
<li>In March, Japan Airport Terminal raised 56.5 billion yen through equity financing. I attended an analyst meeting and would like to share my thoughts on the company.</li>
<li>JAT will start investing in the next fiscal year, and balance sheet is expected to expand. If operating cash flow doesn't grow, equity finance is likely to be taken out.</li>
<li>ROE isn't included in the numerical targets. Considering the fact that treasury stock was sold in the equity financing, the management has distanced itself from focusing on shareholder interests.</li>
</ul>


In March, Japan Airport Terminal raised 56.5 billion yen through equity financing. I attended an analyst meeting and would like to share my thoughts on the company.
JAT will start investing in the next fiscal year, and balance sheet is expected to expand. If operating cash flow doesn't grow, equity finance is likely to be taken out.
ROE isn't included in the numerical targets. Considering the fact that treasury stock was sold in the equity financing, the management has distanced itself from focusing on shareholder interests.


Japan's Governance: Equity Finance Update: Japan Airport Terminal (9706）

<p><a href="https://www.smartkarma.com/entities/sydney-airport" target="_blank" data-smartkarma-citation="entities:19063:1" rel="noopener">Sydney Airport (SYD AU)</a> is Australia’s largest airport and the only listed airport on ASX. Sydney Airport has received a binding proposal and entered a scheme implementation deed (SID) with the Sydney Aviation Alliance consortium.</p><p>The offer price is A$8.75 per share is a 52% premium to the unaffected price of A$5.75 (1 July). The offer is also a marginal 3.6% bump to the first revised offer of A$8.45 per share received from the consortium on 16 August.</p><p>UniSuper will reinvest its 15.01% equity interest for an equivalent equity interest in the consortium’s holding vehicle. The scheme is conditional on shareholder approval, ACCC approval, FIRB approval and EU merger clearance. The scheme meeting is scheduled for 24 January 2022 with an implementation date of 21 February 2022.  </p><div class="content-highlight"><p>The offer will prove attractive to shareholders who are looking for valuation certainty in an environment where the pace of the recovery in international air travel remains unclear. At the last close price of A$8.46, the gross spread is 3.4% and the annualised spread to the implementation date is 12.3%.</p></div>

Sydney Airport (SYD AU) is Australia’s largest airport and the only listed airport on ASX. Sydney Airport has received a binding proposal and entered a scheme implementation deed (SID) with the Sydney Aviation Alliance consortium.The offer price is A$8.75 per share is a 52% premium to the unaffected price of A$5.75 (1 July). The offer is also a marginal 3.6% bump to the first revised offer of A$8.45 per share received from the consortium on 16 August.UniSuper will reinvest its 15.01% equity interest for an equivalent equity interest in the consortium’s holding vehicle. The scheme is conditional on shareholder approval, ACCC approval, FIRB approval and EU merger clearance. The scheme meeting is scheduled for 24 January 2022 with an implementation date of 21 February 2022.  The offer will prove attractive to shareholders who are looking for valuation certainty in an environment where the pace of the recovery in international air travel remains unclear. At the last close price of A$8.46, the gross spread is 3.4% and the annualised spread to the implementation date is 12.3%.

Sydney Airport Enters a Scheme Implementation Deed

<p><a href="https://www.smartkarma.com/entities/sydney-airport" target="_blank" data-smartkarma-citation="entities:19063:1" rel="noopener">Sydney Airport (SYD AU)</a> is Australia’s largest airport and the only listed airport on ASX. Sydney Airport has granted a consortium (Sydney Aviation Alliance) non-exclusive due diligence access based on a further revised indicative proposal of A$8.75 cash per share. The revised indicative offer is A$8.75 per share is a 52% premium to the unaffected price of A$5.75 (1 July). The revised indicative offer is also a marginal 3.6% bump to the first revised offer of A$8.45 per share received from the consortium on 16 August.</p><p>Pushing for a better price is part of the M&amp;A game. The Board were said to be seeking a price around A$9.00 per share, according to press reports. However, the Board faced increasing shareholder pushback to engage with the consortium and facilitate due diligence. The consortium viewed A$9.00 per share as excessive but shareholder feedback suggested that the price of A$8.75 per share would get the Board onside. UniSuper, the largest independent shareholder, will rollover its shares instead of receiving cash under the scheme and will be required to vote as a separate class on the scheme. </p><p>The Board intends to recommend the revised offer subject to a binding scheme implementation agreement and no superior offer. The due diligence which is expected to take four weeks should be relatively straightforward due to the consortium’s expertise in airport infrastructure. The deal requires regulatory approval from the Australian Competition and Consumer Commission (ACCC) and the Foreign Investment Review Board. The ACCC will commence a review of the proposed transaction “<em>in due course</em>” and the review should take about three months to complete. The shareholder vote for approval is likely to be held in 1Q22. </p><div class="content-highlight"><p>Overall, we think that the further revised indicative offer is attractive and marginally above the pre-COVID-19 rights adjusted share price high reached in December 2019. The offer will prove attractive to shareholders who are looking for valuation certainty in an environment where the pace of the recovery in international air travel remains unclear. At the last close price of A$8.23, the shares are trading at a 6.3% gross spread to the indicative offer.</p></div>

Sydney Airport (SYD AU) is Australia’s largest airport and the only listed airport on ASX. Sydney Airport has granted a consortium (Sydney Aviation Alliance) non-exclusive due diligence access based on a further revised indicative proposal of A$8.75 cash per share. The revised indicative offer is A$8.75 per share is a 52% premium to the unaffected price of A$5.75 (1 July). The revised indicative offer is also a marginal 3.6% bump to the first revised offer of A$8.45 per share received from the consortium on 16 August.Pushing for a better price is part of the M&amp;A game. The Board were said to be seeking a price around A$9.00 per share, according to press reports. However, the Board faced increasing shareholder pushback to engage with the consortium and facilitate due diligence. The consortium viewed A$9.00 per share as excessive but shareholder feedback suggested that the price of A$8.75 per share would get the Board onside. UniSuper, the largest independent shareholder, will rollover its shares instead of receiving cash under the scheme and will be required to vote as a separate class on the scheme. The Board intends to recommend the revised offer subject to a binding scheme implementation agreement and no superior offer. The due diligence which is expected to take four weeks should be relatively straightforward due to the consortium’s expertise in airport infrastructure. The deal requires regulatory approval from the Australian Competition and Consumer Commission (ACCC) and the Foreign Investment Review Board. The ACCC will commence a review of the proposed transaction “in due course” and the review should take about three months to complete. The shareholder vote for approval is likely to be held in 1Q22. Overall, we think that the further revised indicative offer is attractive and marginally above the pre-COVID-19 rights adjusted share price high reached in December 2019. The offer will prove attractive to shareholders who are looking for valuation certainty in an environment where the pace of the recovery in international air travel remains unclear. At the last close price of A$8.23, the shares are trading at a 6.3% gross spread to the indicative offer.

Sydney Airport’s Further Revised Offer Gets the Board’s Approval

Japan

Japan Airport Terminal Co., Ltd. constructs, manages and maintains passenger terminals and airport facilities at Haneda and Narita airports.  The Company operates parking-lots, souvenir shops, and duty-free stores.  Japan Airport Terminal, through its subsidiaries, manages restaurants and in-flight meal services.

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Japan Airport Terminal Co (9706 JP)

Air New Zealand Shortfall - Not a Great Take-Up Probably Because of the Large Retail Holding

Air New Zealand (AIR) was aiming to raise around US$827m (NZ$1.2bn) via a renounceable rights issue. It has now launched a shortfall of around...

Sumeet Singh

Sydney Airport Scheme Meeting on 3 Feb 2022, IE Opinion

We continue to think that offer is attractive. At last close prices, the gross spread is 2.1% and the annualised spread to the implementation date...

Arun George

Japan's Governance: Equity Finance Update: Japan Airport Terminal (9706）

It will not be easy to reconcile its basic philosophy, "Harmony between public nature and corporate," with the corporate governance concept based...

Metrical Inc

Sydney Airport Enters a Scheme Implementation Deed

Sydney Airport has entered a SID with the Sydney Aviation Alliance at A$8.75 per share. At the last close, the gross spread is 3.4% and the...

Arun George

Sydney Airport’s Further Revised Offer Gets the Board’s Approval

Sydney Airport has granted DD to a Sydney Aviation Alliance based on a revised price of A$8.75. The offer is attractive and at the last price of...

Arun George

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