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>Sixth Street and BGH Capital entered into a cooperation agreement with the aim to acquire <a href="https://www.smartkarma.com/entities/pushpay-holdings-ltd" target="_blank" data-smartkarma-citation="entities:13737:1" rel="noopener">Pushpay Holdings (PPH NZ)</a> through a scheme of arrangement. They have a combined 20.3% stake. </li>
<li>In addition to Sixth Street/BGH, Pushpay also noted expressions of interest from multiple parties. The high recurring revenue, profitability and cash generation make it a target. </li>
<li>As the Australian takeover premium ranges from 20% to 40%, we think that a bid of at least A$1.46 (30% takeover premium) will be necessary for due diligence access. </li>
</ul>


Sixth Street and BGH Capital entered into a cooperation agreement with the aim to acquire Pushpay Holdings (PPH NZ) through a scheme of arrangement. They have a combined 20.3% stake. 
In addition to Sixth Street/BGH, Pushpay also noted expressions of interest from multiple parties. The high recurring revenue, profitability and cash generation make it a target. 
As the Australian takeover premium ranges from 20% to 40%, we think that a bid of at least A$1.46 (30% takeover premium) will be necessary for due diligence access. 


BGH and Sixth Street to Lob an Offer for Pushpay?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Church donor management tech play <strong><a href="https://www.smartkarma.com/entities/pushpay-holdings-ltd" target="_blank" data-smartkarma-citation="entities:13737:1" rel="noopener">Pushpay Holdings (PPH NZ)</a></strong> said it "<em>recently received unsolicited, non-binding and conditional expressions of interest or approaches from third parties</em>".</li>
<li>No price was mentioned. Shares promptly gained 24% on the news. </li>
<li>Separately, Pushpay reaffirmed its EBITDA guidance for FY22. Those results will be announced on the 11 May.</li>
</ul>


Church donor management tech play Pushpay Holdings (PPH NZ) said it "recently received unsolicited, non-binding and conditional expressions of interest or approaches from third parties".
No price was mentioned. Shares promptly gained 24% on the news. 
Separately, Pushpay reaffirmed its EBITDA guidance for FY22. Those results will be announced on the 11 May.


Expressions Of Interest Resurrect Pushpay

Thematic (Sector/Industry)

<div>
<p>In my insight <em><a href="https://skr.ma/5UGLq" target="_blank" rel="noopener">Virtual IPOs/Direct Listings: Uninhibited Price Discovery</a></em> on the 29 November last year, I mentioned a white paper on special purpose acquisition company (SPAC) may be issued by the SGX in the first half of the following year. </p>
<p>Last week the Business Times <a href="https://www.businesstimes.com.sg/companies-markets/sgx-looking-into-listing-of-special-purpose-acquisition-companies" target="_blank" rel="noopener">reported</a> that a consultation could be launched by the SGX as early as this quarter.</p>
<p>SPACs, or blank-check companies, racked up ~US$80bn in the US in 2020. Once listed and cashed-up, SPACs target investment acquisitions or mergers, providing an alternate back-door listing opportunity for companies. In effect, SPACs synthetically combines a credit instrument with equity upside. </p>
<p>SPACs are non-existent in Asia. SGX's expected consultation paper may herald a strategic push by the bourse to become Asia's SPAC hub. With some US-based SPACs packaging Southeast Asian assets, SGX's motives may well be one of "<em>if you can't beat them, join them</em>".</p>
</div>


In my insight Virtual IPOs/Direct Listings: Uninhibited Price Discovery on the 29 November last year, I mentioned a white paper on special purpose acquisition company (SPAC) may be issued by the SGX in the first half of the following year. 
Last week the Business Times reported that a consultation could be launched by the SGX as early as this quarter.
SPACs, or blank-check companies, racked up ~US$80bn in the US in 2020. Once listed and cashed-up, SPACs target investment acquisitions or mergers, providing an alternate back-door listing opportunity for companies. In effect, SPACs synthetically combines a credit instrument with equity upside. 
SPACs are non-existent in Asia. SGX's expected consultation paper may herald a strategic push by the bourse to become Asia's SPAC hub. With some US-based SPACs packaging Southeast Asian assets, SGX's motives may well be one of "if you can't beat them, join them".


Singapore Exchange: Asia's Future SPAC Hub

<p>Necessity is the mother of financial innovation. The non-traditional listings of <a href="https://www.smartkarma.com/entities/spotify-technology-sa" target="_blank" data-smartkarma-citation="entities:26772:1" rel="noopener">Spotify Technology SA (SPOT US)</a>, <a href="https://www.smartkarma.com/entities/slack-technologies-inc" target="_blank" data-smartkarma-citation="entities:27904:1" rel="noopener">Slack Technologies Inc (WORK US)</a> and <a href="https://www.smartkarma.com/entities/palantir-technologies-inc" target="_blank" data-smartkarma-citation="entities:27728:1" rel="noopener">Palantir Technologies Inc (PLTR US)</a> exhibit an increasing trend toward direct listings, in place of traditional IPOs incorporating lock-up agreements and dysfunctional pricing and allocation process.</p>
<p>This week Airbnb announced plans to go public next year joining the ranks of companies like Spotify and Slack that have used a direct listing to go public.</p>
<p>Is this IPO shortcut route appropriate for all companies? What are the pros and cons? And closer to home, which exchanges are open these virtual IPOs?</p>
<p>In this insight, I address the questions above, discuss various discussions with exchanges in the Asia-Pac regions, and also analyse alternative IPO routes such as special purpose acquisition company (SPACs).</p>
<div class="content-highlight">
<h2>What's Original?</h2>
<p style="text-align: start;">This insight explores the process, benefits, and track record to date of direct listings in equity markets, through to the current developments in Asia.</p>
</div>

Necessity is the mother of financial innovation. The non-traditional listings of Spotify Technology SA (SPOT US), Slack Technologies Inc (WORK US) and Palantir Technologies Inc (PLTR US) exhibit an increasing trend toward direct listings, in place of traditional IPOs incorporating lock-up agreements and dysfunctional pricing and allocation process.
This week Airbnb announced plans to go public next year joining the ranks of companies like Spotify and Slack that have used a direct listing to go public.
Is this IPO shortcut route appropriate for all companies? What are the pros and cons? And closer to home, which exchanges are open these virtual IPOs?
In this insight, I address the questions above, discuss various discussions with exchanges in the Asia-Pac regions, and also analyse alternative IPO routes such as special purpose acquisition company (SPACs).

What's Original?
This insight explores the process, benefits, and track record to date of direct listings in equity markets, through to the current developments in Asia.


Virtual IPOs/Direct Listings: Uninhibited Price Discovery

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<p>Pushpay offers a software which allow attendees of church to make donations through mobile payments. The company operates predominantly in the US and the company is poised to benefit from growth in faith donations market in the US. The digital payments still account for a negligible share in the US church donations segment and Pushpay being a leading player in this niche market exposes the company with significant potential. Pushpay has just started making operating profits and we expect the company’s margins to expand further going forward.</p>

Pushpay offers a software which allow attendees of church to make donations through mobile payments. The company operates predominantly in the US and the company is poised to benefit from growth in faith donations market in the US. The digital payments still account for a negligible share in the US church donations segment and Pushpay being a leading player in this niche market exposes the company with significant potential. Pushpay has just started making operating profits and we expect the company’s margins to expand further going forward.

New Zealand

Pushpay Holdings Limited operates as a holding company. The Company, through its subsidiaries, designs and develops mobile payment application and solutions that allows users to donate to charities and non-profit organization. Pushpay Holdings conducts its business worldwide.

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Pushpay Holdings (PPH NZ)

BGH and Sixth Street to Lob an Offer for Pushpay?

Sixth Street and BGH entered into a cooperation agreement with the aim to acquire Pushpay. They have a combined 20.3% stake. We think that a bid of...

Arun George

Expressions Of Interest Resurrect Pushpay

Given the multitude of interest in Pushpay, any successful premium would exceed the recent share price gain. Trading a discount to historical...

David Blennerhassett

Singapore Exchange: Asia's Future SPAC Hub

Often the disinclination to introduce change is due to an absence of public market sophistication or a deep ecosystem. The SGX should make amends...

David Blennerhassett

Virtual IPOs/Direct Listings: Uninhibited Price Discovery

There’s no cookie-cutter approach that should be employed for every company seeking to go public. But late-stage, venture-backed technology...

David Blennerhassett

Pushpay (Asia Payments): Have Faith

Pushpay offers a software which allow attendees of church to make donations through mobile payments. The company operates predominantly in the US...

Shifara Samsudeen, ACMA, CGMA

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