Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>We have a Negative view on this nearly 3 trillion won rights offering by Samsung Biologics.</li>
<li>The expected price of the rights offering is 599,000 won which is 18.9% below current share price and would represent about 7% shares dilution.</li>
<li>Despite the long-term positive prospects of consolidating results from Samsung Bioepsis, we believe the acquisition price was a bit too high at more than 100% higher than Biogen's valuation multiples.</li>
</ul>


We have a Negative view on this nearly 3 trillion won rights offering by Samsung Biologics.
The expected price of the rights offering is 599,000 won which is 18.9% below current share price and would represent about 7% shares dilution.
Despite the long-term positive prospects of consolidating results from Samsung Bioepsis, we believe the acquisition price was a bit too high at more than 100% higher than Biogen's valuation multiples.


Samsung Biologics: Rights Offering of 3 Trillion Won to Acquire Remaining Stake in Samsung Bioepsis

Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Equity Capital Markets

Samsung Biologics   / Equity Capital Markets

<ul>
<li>Samsung Biologics announced that it would purchase all 10,341,852 shares of Samsung Bioepis owned by Biogen for ₩2.77T. For this, it also announced a ₩3T new share issuance.</li>
<li>The discount rate is 15%, tighter than the usual 20%. Despite that, this offering still deserves attention from an arb perspective as we may see more forfeited shares than expected.</li>
<li>Entry timing? I'll aim at the rights trading window. As a short hedge, I will look at C&amp;T, which is expected to have a higher price synch rate with Biologics.</li>
</ul>


Samsung Biologics announced that it would purchase all 10,341,852 shares of Samsung Bioepis owned by Biogen for ₩2.77T. For this, it also announced a ₩3T new share issuance.
The discount rate is 15%, tighter than the usual 20%. Despite that, this offering still deserves attention from an arb perspective as we may see more forfeited shares than expected.
Entry timing? I'll aim at the rights trading window. As a short hedge, I will look at C&amp;T, which is expected to have a higher price synch rate with Biologics.


Samsung Biologics Offering: Deal Summary & Trading Dynamics

Founder/CEO of ROK Advisory, ROK Advisory LLC

Ken S. Kim

Founder/CEO of ROK Advisory

ROK Advisory LLC

ROK is an independent research advisory firm. We guide you to minimize the information gap between foreign and local investors in Northeast Asia with a focus in Korea, Taiwan and Japan.

Independent Research Advisory Firm

<ul>
<li>
<a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a> was rather stingy with their capital returns after a stellar 2021</li>
<li>The longer term capital commitment plan of its 2 largest holdings gives a higher indication that M&amp;A should be coming</li>
<li>
<a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a> and <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a> account for nearly 30% of KOSPI weight.  Talk about big fish small puddle</li>
</ul>



Samsung Electronics (005930 KS) was rather stingy with their capital returns after a stellar 2021
The longer term capital commitment plan of its 2 largest holdings gives a higher indication that M&amp;A should be coming

LG Energy Solution (373220 KS) and Samsung Electronics (005930 KS) account for nearly 30% of KOSPI weight.  Talk about big fish small puddle


Will Samsung Get EV Envy from LG Energy Solution Listing?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Korean EV battery unit play <a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a> briefly doubled on its debut yesterday before closing 65.8% higher. </li>
<li>Following that gain, LG Energy is now the second-largest company in KOSPI after <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>.</li>
<li>
<a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a> has given back all its gains from earlier this month, and currently trades at ~60% discount to NAV. </li>
</ul>


Korean EV battery unit play LG Energy Solution (373220 KS) briefly doubled on its debut yesterday before closing 65.8% higher. 
Following that gain, LG Energy is now the second-largest company in KOSPI after Samsung Electronics (005930 KS).

LG Chem Ltd (051910 KS) has given back all its gains from earlier this month, and currently trades at ~60% discount to NAV. 


LG Chem: Still Cheap After LG Energy's Big Debut

Quantitative Analysis

<ul>
<li>In this insight, we discuss the dividends announcements which have been made by some of the largest Korean companies (25) in the past two days.</li>
<li>The average percentage difference in the actual versus the consensus estimate DPS in 2021 is 37.4% for these 25 companies.</li>
<li>Kia Motors now has a very nice dividend yield of 3.8%. DPS increased at an impressive rate of 200% YoY in 2021. </li>
</ul>


In this insight, we discuss the dividends announcements which have been made by some of the largest Korean companies (25) in the past two days.
The average percentage difference in the actual versus the consensus estimate DPS in 2021 is 37.4% for these 25 companies.
Kia Motors now has a very nice dividend yield of 3.8%. DPS increased at an impressive rate of 200% YoY in 2021. 


Key Highlights of 25 Major Korean Companies Making Dividends Announcements for 2021

South Korea

Samsung Electronics Co., Ltd. manufactures a wide range of consumer and industrial electronic equipment and products such as semiconductors, personal computers, peripherals, monitors, televisions, and home appliances including air conditioners and microwave ovens. The Company also produces Internet access network systems and telecommunications equipment including mobile phones.

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Samsung Electronics (SMSN LI)

Samsung Biologics: Rights Offering of 3 Trillion Won to Acquire Remaining Stake in Samsung Bioepsis

Despite the long-term positive prospects of consolidating results from Samsung Bioepsis, we believe the acquisition price was a bit too high at...

Douglas Kim

Samsung Biologics Offering: Deal Summary & Trading Dynamics

Samsung Biologics announced that it would purchase all of Samsung Bioepis shares owned by Biogen. So, it also announced a ₩3T rights offering. This...

Sanghyun Park

Will Samsung Get EV Envy from LG Energy Solution Listing?

Does LG Energy Solution listing force Samsung Electronics to make a M&A decision sooner versus later? Lot of ego at stake and Samsung did say at...

Ken S. Kim

LG Chem: Still Cheap After LG Energy's Big Debut

Go outright long in L Chem or hedge against a basket of domestic chemical peers. LGES won't be shortable until the 11 March.

David Blennerhassett

Key Highlights of 25 Major Korean Companies Making Dividends Announcements for 2021

In this insight, we discuss the dividends announcements which have been made by some of the largest Korean companies (25) in the past two days.

Douglas Kim

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