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 <a href="https://asia.nikkei.com/Spotlight/Toshiba-in-turmoil/Japanese-consortium-makes-final-offer-on-Toshiba-buyout" target="_blank" rel="noopener">Nikkei reports</a> that Japan Industrial Partners (JIP), the preferred bidder, has finally secured financing and submitted a final offer to <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>’s Board.</li>
<li>Nikkei notes that JIP expects to spend about JPY2 trillion on the acquisition suggesting an offer price around JPY4,750 per share, -4% below the undisturbed price of JPY4,957.60 (21 April).</li>
<li>The hard part now is getting the Board to accept the unremarkable offer and the banks’ conditions. If the Board succumbs, the next challenge is to get shareholders to accept.</li>
</ul>


The Nikkei reports that Japan Industrial Partners (JIP), the preferred bidder, has finally secured financing and submitted a final offer to Toshiba Corp (6502 JP)’s Board.
Nikkei notes that JIP expects to spend about JPY2 trillion on the acquisition suggesting an offer price around JPY4,750 per share, -4% below the undisturbed price of JPY4,957.60 (21 April).
The hard part now is getting the Board to accept the unremarkable offer and the banks’ conditions. If the Board succumbs, the next challenge is to get shareholders to accept.


Toshiba (6502 JP): Formal Offer Lodged, Now for the Hard Part

Japan Specialist

Mark Chadwick

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  SPX resumes rally as Powell Speech affirms 5% Peak rates;   Beta dominates as Energy and Tech lead; Oil rebound as EIA sees higher Oil +  Saudis lift prices</li>
<li>JAPAN.  NKY Futs -0.1% (flat) vs Cash;  Inbound headwinds as China excludes Japan from Group tours;  Son skips Softbank brief in wake of Vision fund disaster; Nintendo/Switch - its Over!</li>
<li>DAILY NUGGETS. Nintendo - Game Over. Is our view.  The Switch is getting old and we are past the peak..</li>
</ul>


OVERSEAS.  SPX resumes rally as Powell Speech affirms 5% Peak rates;   Beta dominates as Energy and Tech lead; Oil rebound as EIA sees higher Oil +  Saudis lift prices
JAPAN.  NKY Futs -0.1% (flat) vs Cash;  Inbound headwinds as China excludes Japan from Group tours;  Son skips Softbank brief in wake of Vision fund disaster; Nintendo/Switch - its Over!
DAILY NUGGETS. Nintendo - Game Over. Is our view.  The Switch is getting old and we are past the peak..


Good Morning Japan |Peak Rates Still 5% Post Powell - Beta Roars Back; Inbound-China Excludes Japan

<ul>
<li>OVERSEAS.  SPX Pulls Back for 2nd day as Spy Balloons dominate - mkts just stretched;  Google responds to ChatGPT with BARD; Dell cuts headcount as PC struggle continues</li>
<li>JAPAN. NKY Fut flat vs Cash; USDJPY 132.63; Govt denies BOJ-Amamiya claim(really !); Son to skip Softban earnings call; Masa Takafumi wins Grammy with Sakura!</li>
<li>DAILY NUGGET. MHI  formalizes exit from Spacejet. No surprise as it has been on ice for 2 years.   Opportunity to put a positive spin on the $7bn failure.</li>
</ul>


OVERSEAS.  SPX Pulls Back for 2nd day as Spy Balloons dominate - mkts just stretched;  Google responds to ChatGPT with BARD; Dell cuts headcount as PC struggle continues
JAPAN. NKY Fut flat vs Cash; USDJPY 132.63; Govt denies BOJ-Amamiya claim(really !); Son to skip Softban earnings call; Masa Takafumi wins Grammy with Sakura!
DAILY NUGGET. MHI  formalizes exit from Spacejet. No surprise as it has been on ice for 2 years.   Opportunity to put a positive spin on the $7bn failure.


Good Morning Japan | Spy Balloons?? SPX Holds; Google Responds with BARD; BOJ AMAMIYA Story Refuted!

<ul>
<li>
<a href="https://www.bloomberg.com/news/articles/2023-01-31/japan-banks-extend-deadline-for-toshiba-bid-s-loan-decision#xj4y7vzkg" target="_blank" rel="noopener">Bloomberg reports</a> that Japan Industrial Partners (JIP), the preferred bidder, has again extended the deadline for securing bank financing of around JPY1.2 trillion (US$8.8 billion).</li>
<li>A new issue has pushed the deadline to 3 February. If JIP manages to secure financing for an offer of around JPY5,100, the next challenge is securing Board support.</li>
<li>The 3QFY2022 update on 14 February needs to avoid further downgrades to keep the deal alive. Toshiba’s multiples are unattractive to peers. Remain on the sidelines for now.</li>
</ul>



Bloomberg reports that Japan Industrial Partners (JIP), the preferred bidder, has again extended the deadline for securing bank financing of around JPY1.2 trillion (US$8.8 billion).
A new issue has pushed the deadline to 3 February. If JIP manages to secure financing for an offer of around JPY5,100, the next challenge is securing Board support.
The 3QFY2022 update on 14 February needs to avoid further downgrades to keep the deal alive. Toshiba’s multiples are unattractive to peers. Remain on the sidelines for now.


Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms

<ul>
<li>OVERSEAS.  SPX positive on day, +2.5%WoW; SOX +5.4%WoW;  PCE Inflation sets stage for benign Fed; INTEL, KLC puts damper on tech party; TELSA delivers again; AMEX not seeing consumer weakness; </li>
<li>JAPAN. NKY Futs vs Cash +0.1%; USDJPY 129.88; Tokyo Dec CPI highest since 1981; GS sees highest base pay hike in decades.;  Fanuc 3Q beats on Robots; Sagawa hikes prices</li>
<li>DAILY. NUGGETS. Stealth Immigration - Foreigner workers in Japan hit all time high 1.82 million/2.7% of labour force. Clear policy on Immigration needed to help secure Japan's  future. </li>
</ul>


OVERSEAS.  SPX positive on day, +2.5%WoW; SOX +5.4%WoW;  PCE Inflation sets stage for benign Fed; INTEL, KLC puts damper on tech party; TELSA delivers again; AMEX not seeing consumer weakness; 
JAPAN. NKY Futs vs Cash +0.1%; USDJPY 129.88; Tokyo Dec CPI highest since 1981; GS sees highest base pay hike in decades.;  Fanuc 3Q beats on Robots; Sagawa hikes prices
DAILY. NUGGETS. Stealth Immigration - Foreigner workers in Japan hit all time high 1.82 million/2.7% of labour force. Clear policy on Immigration needed to help secure Japan's  future. 


Good Morning Japan |SPX Break Out In Sight ! ; PCE Inflation Delivers; Fed +25bps ? ; Awful INTEL

Japan

FANUC CORPORATION manufactures factory automation (FA) systems and equipments, and robots. The Company's products include computerized numerically-controlled (CNC) equipment, servo motors, laser systems, industrial robots, wire-cut electric discharge machines, and CNC drill.  Fanuc participates in a joint venture with General Electric in the FA field.

KOMATSU LTD. manufactures and sells construction and mining machinery, including excavators, bulldozers, and wheel loaders.  The Company, operating on a global scale, also produces forklift trucks and engineering equipment such as press system.

KUBOTA CORPORATION manufactures industrial machinery, farm machinery, and fluid piping systems.  The Company's products include ductile iron pipes, engines, tractors, combine harvesters, reaper binders, rice planters, and excavators.  Kubota also produces forged iron products, housing equipment, and environmental control plants.

SMC CORPORATION manufactures directional control devices such as power, hand, and air valves.  The Company also produces air filters, cylinders, and actuators along with other pneumatic equipment.  SMC seeks to become a comprehensive maker of automated equipment through the market demand of information and communications products.

KOMATSU LTD. manufactures and sells construction and mining machinery, including excavators, bulldozers, and wheel loaders. The Company, operating on a global scale, also produces forklift trucks and engineering equipment such as press system.

KUBOTA CORPORATION manufactures industrial machinery, farm machinery, and fluid piping systems. The Company's products include ductile iron pipes, engines, tractors, combine harvesters, reaper binders, rice planters, and excavators. Kubota also produces forged iron products, housing equipment, and environmental control plants.

EBARA CORPORATION manufactures pneumatic and hydraulic pumps and related equipment.  The Company's products include fuel, oil, water, and firefighting pumps, as well as steam turbines and boilers.  Ebara Corporation also engineers garbage incinerators, smoke desulfurizers, and other products related to environmental technology.

Minebea Mitsumi manufactures and markets miniature and instrument ball bearings.  The Company also makes DC motors, servo motors, stepping motors, spindle motors, pivot assemblies, rod-end and spherical bearings, fasteners, and computer keyboards. Minebea Mitsumi has production facilities in Thailand and Singapore.

Kawasaki Heavy Industries, Ltd. designs, develops, and manufactures transport equipment and industrial heavy machinery for military and commercial use.  The Company produces ships, railroad cars, aircraft engines and parts, hydraulic and gas turbines, submarine engines, boilers, and industrial robots.  Kawasaki Heavy Industries offers engineering and construction services to industrial plants.

DAIFUKU CO., LTD. designs, manufactures, and sells material handling equipment such as automated storage systems, conveyors, and automatic sorters.  The Company's products are used for automation in manufacturing and distribution businesses.

CRRC Corporation Limited manufactures rolling stock products. The Company produces locomotives, passenger carriages, freight wagons, vehicles key components, and other products. CRRC also provides vehicle repairing, investment management, and other services.

Stanley Black & Decker Inc. is a diversified global provider of hand tools, power tools and related accessories, mechanical access and electronic security solutions, healthcare solutions, engineered fastening systems, and more.

Graco Inc. supplies technology for the management of fluids in both industrial and commercial applications.  The Company designs, manufactures, and markets systems to move, measure, control, dispense, and apply fluid materials.  Graco's products are used for applying paints and coatings, high-pressure cleaning of equipment, and lubricating and maintaining vehicles and other equipment.

China CSSC Holdings Ltd. offers shipbuilding, ship components, ship repairing and diesel engines manufacturing. The Company distributes its products within the domestic market and to overseas markets.

Nordson Corporation designs, manufactures, and markets systems that apply adhesives, sealants, and coatings to consumer and industrial products during manufacturing operations.  The Company's products include customized electronic controls for the precise application and curing of materials to meet customers' requirements.  Nordson operates around the world.

China Shipbuilding Industry Company Limited designs, manufactures, sells and leases ship parts.  The Company's products include engines and parts, auxiliay engines and transportation equipment.

Parker-Hannifin Corporation manufactures motion control products, including fluid power systems, electromechanical controls, and related components.  The Company also produces fluid purification, fluid flow, process instrumentation, air conditioning, refrigeration, and electromagnetic shielding and thermal management products.

Cummins India Limited manufactures internal combustion engines, including diesel, reciprocating piston, gas turbine and gasoline engines. The Company also manufactures generating sets and public transport-type passenger motor vehicles, including luxury coaches and air-field buses.  In addition, Cummins India Ltd. operates a computerized and fully-equipped research and development facility.

IDEX Corporation designs, manufactures, and markets a variety of pump products, dispensing equipment, and other engineered products.  The Company's products include industrial pumps, lubrication systems, banding and clamping devices, and rescue tools.  IDEX markets its products to customers in the United States and overseas.

Xylem, Inc. is a designer, manufacturer, equipment and service provider for water and wastewater applications addressing the full-cycle of water from collection, distribution, and use to the return of water to the environment. The Company's products include water and wastewater pumps, treatment and testing equipment, industrial pumps, valves, heat exchangers, and dispensing equipment.

Mitsubishi Heavy Industries, Ltd. is a comprehensive heavy machinery maker. The Company manufactures machinery, ships, turbines and engines, prime movers, aircrafts, and machine parts for military and commercial use.  Mitsubishi Heavy Industries also researches and develops nuclear power plants.

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Mitsubishi Heavy Industries (7011 JP)

Toshiba (6502 JP): Formal Offer Lodged, Now for the Hard Part

The hard part now is getting the Board to accept the unremarkable offer and the banks’ conditions. If the Board succumbs, the next challenge is to...

Arun George

Good Morning Japan |Peak Rates Still 5% Post Powell - Beta Roars Back; Inbound-China Excludes Japan

NKY indicated flate; Inbound headwinds as China exludes Japan from Group tours; Son skips Softbank brief in wake of Vision fund disaster; Nintendo...

Mark Chadwick

Good Morning Japan | Spy Balloons?? SPX Holds; Google Responds with BARD; BOJ AMAMIYA Story Refuted!

NKY Fut flat vs Cash; USDJPY 132.63; Govt denies BOJ-Amamiya claim(really !); Son to skip Softban earnings call; Masa Takafumi wins Grammy with...

Mark Chadwick

Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms

The ongoing financing deadline extensions and a looming 3Q update add to the deal uncertainty. While the price ratio is undemanding, Toshiba’s...

Arun George

Good Morning Japan |SPX Break Out In Sight ! ; PCE Inflation Delivers; Fed +25bps ? ; Awful INTEL

NKY Futs vs Cash +0.1%; Tokyo Dec CPI highest since 1981; GS sees highest base pay hike in decades.; Fanuc 3Q beats on Robots; Sagawa hikes...

Mark Chadwick

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