Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Mitsubishi Logisnext Co., Ltd. / Event-Driven

<ul>
<li>There was a Nikkei article in December about the <a href="https://www.smartkarma.com/entities/mitsubishi-heavy-industries" target="_blank" data-smartkarma-citation="entities:13613:1" rel="noopener">Mitsubishi Heavy Industries (7011 JP)</a> selling its interests in <a href="https://www.smartkarma.com/entities/mitsubishi-logisnext-co-ltd" target="_blank" data-smartkarma-citation="entities:11662:1" rel="noopener">Mitsubishi Logisnext Co., Ltd. (7105 JP)</a>. </li>
<li>The stock popped. Then popped some more. It was not expensive yet, but no longer dirt cheap. Now the stock is falling as Trump Tariffs threaten to throttle exports.</li>
<li>The reasons why this takeout price could be "high" are unchanged. Tariffs meant to drive US-manufacturing don't reduce need for forklifts. Logisnext is not badly placed.</li>
</ul>


There was a Nikkei article in December about the Mitsubishi Heavy Industries (7011 JP) selling its interests in Mitsubishi Logisnext Co., Ltd. (7105 JP). 
The stock popped. Then popped some more. It was not expensive yet, but no longer dirt cheap. Now the stock is falling as Trump Tariffs threaten to throttle exports.
The reasons why this takeout price could be "high" are unchanged. Tariffs meant to drive US-manufacturing don't reduce need for forklifts. Logisnext is not badly placed.


Mitsubishi Logisnext (7105) - Worth Buying The Dip On Likely Sale

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

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<ul>
<li>
<a href="https://www.smartkarma.com/entities/mitsubishi-logisnext-co-ltd" target="_blank" rel="noopener">Mitsubishi Logisnext Co., Ltd. (7105 JP)</a> shares rose 26% after the Nikkei reported that <a href="https://www.smartkarma.com/entities/mitsubishi-heavy-industries" target="_blank" data-smartkarma-citation="entities:13613:1" rel="noopener">Mitsubishi Heavy Industries (7011 JP)</a> is contemplating selling its 64.5% stake. </li>
<li>Logisnext confirmed the sale process. In a fair process, minorities should receive the tender offer price plus the proportionate share of Mitsubishi Heavy Industries’ TOB tax benefits. </li>
<li>Despite the rise in share price, Logisnext trades at a discount to peer multiples. At an offer of JPY2,000, Logisnext would trade in line with median peer multiples.</li>
</ul>



Mitsubishi Logisnext Co., Ltd. (7105 JP) shares rose 26% after the Nikkei reported that Mitsubishi Heavy Industries (7011 JP) is contemplating selling its 64.5% stake. 
Logisnext confirmed the sale process. In a fair process, minorities should receive the tender offer price plus the proportionate share of Mitsubishi Heavy Industries’ TOB tax benefits. 
Despite the rise in share price, Logisnext trades at a discount to peer multiples. At an offer of JPY2,000, Logisnext would trade in line with median peer multiples.


Mitsubishi Logisnext (7105 JP): Mitsubishi Heavy Industries (7011 JP) Seeks to Exit

<ul>
<li>A Nikkei <a href="https://asia.nikkei.com/Business/Business-deals/Japan-s-Mitsubishi-Heavy-to-sell-forklift-unit-Logisnext" target="_blank" rel="noopener">article</a> this morning several hours pre-open said that <a href="https://www.smartkarma.com/entities/mitsubishi-heavy-industries" target="_blank" data-smartkarma-citation="entities:13613:1" rel="noopener">Mitsubishi Heavy Industries (7011 JP)</a> was preparing to sell its listed forklift subsidiary <a href="https://www.smartkarma.com/entities/mitsubishi-logisnext-co-ltd" target="_blank" data-smartkarma-citation="entities:11662:1" rel="noopener">Mitsubishi Logisnext Co., Ltd. (7105 JP)</a>. </li>
<li>The story says "Investors had been pressuring Mitsubishi Heavy to spin off or delist Logisnext" and we know the TSE dislikes dual listings. I would have expected a buy-in but...</li>
<li>There are a number of reasons why a buyer could find this asset attractive. I suggest reading all the way through and the tone of the Conclusions.</li>
</ul>


A Nikkei article this morning several hours pre-open said that Mitsubishi Heavy Industries (7011 JP) was preparing to sell its listed forklift subsidiary Mitsubishi Logisnext Co., Ltd. (7105 JP). 
The story says "Investors had been pressuring Mitsubishi Heavy to spin off or delist Logisnext" and we know the TSE dislikes dual listings. I would have expected a buy-in but...
There are a number of reasons why a buyer could find this asset attractive. I suggest reading all the way through and the tone of the Conclusions.


Mitsubishi Logisnext (7105) - The Next Target in Logistics Space?

David Blennerhassett

<ul>
<li>At a zero net debt zero net cash (securities liquidated) Adjusted Price/Earnings Ratio of 11.3x expected Net Income, the multiple offered <a href="https://www.smartkarma.com/entities/makino-milling-machine-co" target="_blank" data-smartkarma-citation="entities:5200:1" rel="noopener">Makino Milling Machine (6135 JP)</a> is not a knock-out.</li>
<li>
<a href="https://www.smartkarma.com/entities/enn-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:316:1" rel="noopener">ENN Energy (2688 HK)</a> investors hoping for a clean (er) exit, or where the back-end terms were clearly defined, will be disappointed. And minorities are active in this name. Avoid</li>
<li>New Trump Tariffs are not based on any actual tariffs, or non-tariff measures. The simple/explicit assumption is that if you run a trade surplus with the US, you are cheating.</li>
</ul>


At a zero net debt zero net cash (securities liquidated) Adjusted Price/Earnings Ratio of 11.3x expected Net Income, the multiple offered Makino Milling Machine (6135 JP) is not a knock-out.

ENN Energy (2688 HK) investors hoping for a clean (er) exit, or where the back-end terms were clearly defined, will be disappointed. And minorities are active in this name. Avoid
New Trump Tariffs are not based on any actual tariffs, or non-tariff measures. The simple/explicit assumption is that if you run a trade surplus with the US, you are cheating.


Last Week in Event SPACE: Makino, ENN Energy, Trump Tariffs, HKBN

<ul>
<li>Reportedly, Ito Junro's MBO for <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I (3382 JP)</a> includes a US assets IPO to help pay down MBO debt to Japanese banks.  Possible strategic mistake by Ito-san here.</li>
<li>Starwood/Warburg Pincus' firm Offer for <a href="https://www.smartkarma.com/entities/esr-group-ltd" target="_blank" data-smartkarma-citation="entities:27983:1" rel="noopener">ESR Group (1821 HK)</a> secures support from 30.79% of the register.</li>
<li>We may be wrong on <a href="https://www.smartkarma.com/entities/sanrio-co-ltd" target="_blank" data-smartkarma-citation="entities:16476:1" rel="noopener">Sanrio (8136 JP)</a> by a big factor but the multiple and the concentration risk of momentum factor means you are in an illiquid stock.</li>
</ul>


Reportedly, Ito Junro's MBO for Seven &amp; I (3382 JP) includes a US assets IPO to help pay down MBO debt to Japanese banks.  Possible strategic mistake by Ito-san here.
Starwood/Warburg Pincus' firm Offer for ESR Group (1821 HK) secures support from 30.79% of the register.
We may be wrong on Sanrio (8136 JP) by a big factor but the multiple and the concentration risk of momentum factor means you are in an illiquid stock.


Last Week in Event SPACE: Seven & I Holdings, ESR Group, Sanrio, HKBN

Japan

Mitsubishi Logisnext Co., Ltd. manufactures industrial vehicles and logistics systems. The Company's products include battery forklifts, unmanned forklifts, monorails, automated warehouses, powered moving shelves, and other logistics related products.

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Mitsubishi Logisnext Co., Ltd. (7105 JP)

Mitsubishi Logisnext (7105) - Worth Buying The Dip On Likely Sale

Logisnext is dipping on market dip (some would put it more strongly). This deal is not specifically tariff-risk (imho) because US mfg plants are an...

Travis Lundy

Mitsubishi Logisnext (7105 JP): Mitsubishi Heavy Industries (7011 JP) Seeks to Exit

Despite the rise in share price, Logisnext trades at a discount to peer multiples. At an offer of JPY2,000, Logisnext would trade in line with...

Arun George

Mitsubishi Logisnext (7105) - The Next Target in Logistics Space?

The Nikkei carried an article this AM pre-open saying Mit Heavy was looking to sell Mitsubishi Logisnext. Forklift makers aren't having a great...

Travis Lundy

Last Week in Event SPACE: Makino, ENN Energy, Trump Tariffs, HKBN

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

Last Week in Event SPACE: Seven & I Holdings, ESR Group, Sanrio, HKBN

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

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