Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<p>Last Week in Event <strong>SPACE</strong> ...</p>
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<li>With <strong><a href="https://www.smartkarma.com/entities/li-fung-ltd" target="_blank" data-smartkarma-citation="entities:6290:1" rel="noopener">Li &amp; Fung Ltd (494 HK)</a></strong> operations appearing more structurally, and permanently, impaired, as opposed to facing short-term challenges, the privatisation Offer is looking more attractive.</li>
<li>The later payment date for <strong><a href="https://www.smartkarma.com/entities/hitachi-high-technologies-co" target="_blank" data-smartkarma-citation="entities:7046:1" rel="noopener">Hitachi High Technologies Co (8036 JP)</a></strong> lowers the IRR of buying shares in near-space quite significantly. It could mean the shares drop further than thought. </li>
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<a href="https://www.smartkarma.com/entities/allied-group-ltd" target="_blank" data-smartkarma-citation="entities:4387:1" rel="noopener"><strong>Allied (373 HK)</strong></a> and 74.99%-held <a href="https://www.smartkarma.com/entities/allied-properties-hk-ltd" target="_blank" data-smartkarma-citation="entities:19953:1" rel="noopener"><strong>Allied Properties Hk (56 HK)</strong></a> are both suspended pursuant to the Takeovers Code, with APH expected to be privatised. This should not trigger downstream MGOs for its three key listed holdings.</li>
<li>Stay bearish on <strong><a href="https://www.smartkarma.com/entities/singapore-airlines-ltd" target="_blank" data-smartkarma-citation="entities:74:1" rel="noopener">Singapore Airlines (SIA SP)</a></strong>. There will be plenty of time to own this stock later. The Rights Entitlements (both to Rights Shares and Rights MCBs), if traded on the exchange as they should be, will initially see short-covering and may trade rich, then they and the shares should trade down. </li>
<li>TOPIX ETF buying by the BOJ should support a Long <strong><a href="https://www.smartkarma.com/entities/renesas-electronics-corp" target="_blank" data-smartkarma-citation="entities:15933:1" rel="noopener">Renesas Electronics (6723 JP)</a></strong>, Short <strong><a href="https://www.smartkarma.com/entities/tokyo-electron-ltd" target="_blank" data-smartkarma-citation="entities:280:1" rel="noopener">Tokyo Electron (8035 JP)</a></strong> trade which looks attractive purely based on the deviation from historical ratios.</li>
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<li>Plus, other events, CCASS movements and Mood Spins.</li>
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<p><em>(This insight covers specific insights &amp; comments involving <strong>S</strong>tubs, <strong>P</strong>airs, <strong>A</strong>rbitrage, share <strong>C</strong>lassifications, and <strong>E</strong>vents - or <strong>SPACE</strong> - in the past week)</em></p>


Last Week in Event SPACE ...



With Li &amp; Fung Ltd (494 HK) operations appearing more structurally, and permanently, impaired, as opposed to facing short-term challenges, the privatisation Offer is looking more attractive.
The later payment date for Hitachi High Technologies Co (8036 JP) lowers the IRR of buying shares in near-space quite significantly. It could mean the shares drop further than thought. 

Allied (373 HK) and 74.99%-held Allied Properties Hk (56 HK) are both suspended pursuant to the Takeovers Code, with APH expected to be privatised. This should not trigger downstream MGOs for its three key listed holdings.
Stay bearish on Singapore Airlines (SIA SP). There will be plenty of time to own this stock later. The Rights Entitlements (both to Rights Shares and Rights MCBs), if traded on the exchange as they should be, will initially see short-covering and may trade rich, then they and the shares should trade down. 
TOPIX ETF buying by the BOJ should support a Long Renesas Electronics (6723 JP), Short Tokyo Electron (8035 JP) trade which looks attractive purely based on the deviation from historical ratios.




Plus, other events, CCASS movements and Mood Spins.


(This insight covers specific insights &amp; comments involving Stubs, Pairs, Arbitrage, share Classifications, and Events - or SPACE - in the past week)

Last Week in Event SPACE: Li & Fung, Hitachi Hi-Chem, Allied Prop, Sing Air, Renesas/Tokyo Electron

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<p>The Composite Document for China Merchants Group Limited's (CMG) Offer for <a href="https://www.smartkarma.com/entities/dalian-port-pda-co-ltd-h" target="_blank" data-smartkarma-citation="entities:12817:1" rel="noopener">Dalian Port (Pda) Co Ltd H (2880 HK)</a> was <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2019/1004/ltn20191004213.pdf" target="_blank" rel="noopener">dispatched</a> on the 5th October.  This is an unconditional MGO. If you buy and tender, you will receive the consideration price within 7 business days following the date of receipt by the registrar of the acceptance of the tender. This also means, buying today, or probably tomorrow at the latest, to give you adequate time to turn around your acceptance.</p>
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<p>The MGO was triggered following the restructuring of various PRC-government-related companies, collectively holding 68.37% into Dalian Port. CMG intends to maintain Dalian Port's listing and will take steps to restore the public float should the need arise.</p>
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<p>By my reckoning, the 25% free float has now been breached. This is not cause for concern, nor even if the float dips below 15%. But the mechanics of what can transpire are worth noting. Plus, there is always the remote chance CMG avails itself of the opportunity to compulsorily acquire shares.</p>
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<p>More detail below.</p>
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<p><em>This insight is more a technical read into the Hong Kong <a href="https://www.sfc.hk/web/EN/assets/components/codes/files-current/web/codes/the-codes-on-takeovers-and-mergers-and-share-buy-backs/the-codes-on-takeovers-and-mergers-and-share-buy-backs.pdf" target="_blank" rel="noopener">Code</a> on Takeovers. My prior insights on this transaction - see the right-hand side for links - go into more detail on the Offer itself.</em></p>
<p><em>Please see the <a href="https://www.smartkarma.com/insights/quiddity-hong-kong-m-a-guide-2019" target="_blank" data-smartkarma-citation="insights:29174" rel="noopener">Quiddity Hong Kong M&amp;A Guide 2019</a> for more details on the ins and outs (and foibles) of the Hong Kong rules, regulations, and practices in M&amp;A. For other guides in the series, click <a href="https://www.smartkarma.com/search?q=quiddity%20M%26A%20guide%202019" target="_blank" rel="noopener">here</a> and scroll down to where the highlighted titles appear.</em></p>
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The Composite Document for China Merchants Group Limited's (CMG) Offer for Dalian Port (Pda) Co Ltd H (2880 HK) was dispatched on the 5th October.  This is an unconditional MGO. If you buy and tender, you will receive the consideration price within 7 business days following the date of receipt by the registrar of the acceptance of the tender. This also means, buying today, or probably tomorrow at the latest, to give you adequate time to turn around your acceptance.


The MGO was triggered following the restructuring of various PRC-government-related companies, collectively holding 68.37% into Dalian Port. CMG intends to maintain Dalian Port's listing and will take steps to restore the public float should the need arise.


By my reckoning, the 25% free float has now been breached. This is not cause for concern, nor even if the float dips below 15%. But the mechanics of what can transpire are worth noting. Plus, there is always the remote chance CMG avails itself of the opportunity to compulsorily acquire shares.


More detail below.



This insight is more a technical read into the Hong Kong Code on Takeovers. My prior insights on this transaction - see the right-hand side for links - go into more detail on the Offer itself.
Please see the Quiddity Hong Kong M&amp;A Guide 2019 for more details on the ins and outs (and foibles) of the Hong Kong rules, regulations, and practices in M&amp;A. For other guides in the series, click here and scroll down to where the highlighted titles appear.


Hong Kong

Portico International Holdings Ltd designs, manufactures, and retails ladies' and men's fashion garments, and sells accessories such as shoes, handbags, scarves, and fragrances in China and Hong Kong under its brand name PORT INTERNATIONAL.

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Portico International Holdings (589 HK)

Last Week in Event SPACE: Li & Fung, Hitachi Hi-Chem, Allied Prop, Sing Air, Renesas/Tokyo Electron

Last Week in Event SPACE ... With Li & Fung Ltd (494 HK) operations appearing more structurally, and permanently, impaired, as opposed to...

David Blennerhassett

Dalian Port And "Truth In Statements"

The Composite Document for China Merchants Group Limited's (CMG) Offer for Dalian Port (Pda) Co Ltd H (2880 HK) was dispatched on the 5th...

David Blennerhassett

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