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

Hollysys Automation Technologies / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys Automation Technologies (HOLI US)</a> has agreed to be acquired by Ascendent Capital, the largest shareholder, for US$26.50, a 16.7% premium to the last close.   </li>
<li>The Board's claims of realising the highest shareholder value are not credible. The Board fails to explain why Ascendent’s offer is superior to Recco’s, although both have the same value.</li>
<li>Deal fatigue (the process first started in December 2020) and the 42% premium to the undisturbed price suggests meeting the simple majority threshold for a statutory merger is achievable.</li>
</ul>



Hollysys Automation Technologies (HOLI US) has agreed to be acquired by Ascendent Capital, the largest shareholder, for US$26.50, a 16.7% premium to the last close.   
The Board's claims of realising the highest shareholder value are not credible. The Board fails to explain why Ascendent’s offer is superior to Recco’s, although both have the same value.
Deal fatigue (the process first started in December 2020) and the 42% premium to the undisturbed price suggests meeting the simple majority threshold for a statutory merger is achievable.


Hollysys (HOLI US): Questionable Process Results in Ascendent’s Winning US$26.50 Bid

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

iShares MSCI Brazil Capped ETF / Technical Analysis

<ul>
<li>In our October 26, 2023 Int'l Compass we discussed our expectations for a bounce in global equities (MSCI ACWI). So far, that has been the low.</li>
<li>Then, in our November 2, 2023 report, we discussed the bullish implications of the false breakdown in MSCI ACWI (local currency), before discussing expectations for a year-end rally on Nov.16</li>
<li>We see a massive opportunity in global gold/silver miners with gold nearing multi-year breakout. Also buy opportunities: Utilities in Europe, UK, and India; Materials, Industrials, Transportation, Real Estate, and Technology</li>
</ul>


In our October 26, 2023 Int'l Compass we discussed our expectations for a bounce in global equities (MSCI ACWI). So far, that has been the low.
Then, in our November 2, 2023 report, we discussed the bullish implications of the false breakdown in MSCI ACWI (local currency), before discussing expectations for a year-end rally on Nov.16
We see a massive opportunity in global gold/silver miners with gold nearing multi-year breakout. Also buy opportunities: Utilities in Europe, UK, and India; Materials, Industrials, Transportation, Real Estate, and Technology


Bullish Outlook Intact; Upgrading Brazil to Overweight; Buying Global Gold/Silver Miners + More Buys

<ul>
<li>The <a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys Automation Technologies (HOLI US)</a> Board has finally succumbed to shareholder pressure by targeting a special meeting of shareholders in the week commencing 22 January 2024.</li>
<li>The special meeting is a side event as the Board targets a binding proposal by mid-December, with some bidders proceeding to the confirmatory due diligence stage.</li>
<li>The BVI takeover structure and Hollysys’ undemanding valuation facilitate a competitive bidding process. A 10% uplift to the current highest offer (Recco’s US$26.50 offer) is possible.</li>
</ul>


The Hollysys Automation Technologies (HOLI US) Board has finally succumbed to shareholder pressure by targeting a special meeting of shareholders in the week commencing 22 January 2024.
The special meeting is a side event as the Board targets a binding proposal by mid-December, with some bidders proceeding to the confirmatory due diligence stage.
The BVI takeover structure and Hollysys’ undemanding valuation facilitate a competitive bidding process. A 10% uplift to the current highest offer (Recco’s US$26.50 offer) is possible.


Hollysys (HOLI US): Progress as a Binding Proposal Targeted for Mid-December

<ul>
<li>Ascendent Capital has made a <a href="https://app.quotemedia.com/data/downloadFiling?webmasterId=101533&amp;ref=317844343&amp;type=PDF&amp;symbol=HOLI&amp;cdn=eb09d796c5e38b2cb3fcc4b11a699c1a&amp;companyName=Hollysys+Automation+Technologies+Ltd.&amp;formType=SC+13D&amp;dateFiled=2023-11-06" target="_blank" rel="noopener">non-binding proposal</a> for <a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys Automation Technologies (HOLI US)</a> at US$26.00 per share, a 4.0% premium to the MBO and Recco proposal of US$25.00 per share. </li>
<li>Ascendent has also become the largest shareholder by securing 13.69% of outstanding shares at an average price of A$20.84 per share. Ascendant is supportive of the special meeting request.</li>
<li>The Board has tried several delaying tactics, but the emergence of Ascendant ramps up the pressure on the Board to conduct a transparent sale process and address shareholder concerns. </li>
</ul>


Ascendent Capital has made a non-binding proposal for Hollysys Automation Technologies (HOLI US) at US$26.00 per share, a 4.0% premium to the MBO and Recco proposal of US$25.00 per share. 
Ascendent has also become the largest shareholder by securing 13.69% of outstanding shares at an average price of A$20.84 per share. Ascendant is supportive of the special meeting request.
The Board has tried several delaying tactics, but the emergence of Ascendant ramps up the pressure on the Board to conduct a transparent sale process and address shareholder concerns. 


Hollysys (HOLI US): Ascendent Capital Joins the Fray

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hollysys-automation-technologies" target="_blank" data-smartkarma-citation="entities:26078:1" rel="noopener">Hollysys Automation Technologies (HOLI US)</a> update notes a new MBO proposal at US$25 per share, a bidders shortlist in several weeks and an update on the special meeting. </li>
<li>The update suggests several potential bidders and enough shareholders with the required record date to convene the special meeting to appoint independent directors. </li>
<li>The MBO proposal, while potentially a delaying tactic, suggests that the Board are under pressure for a solution and is aiming for a friendly takeover. </li>
</ul>



Hollysys Automation Technologies (HOLI US) update notes a new MBO proposal at US$25 per share, a bidders shortlist in several weeks and an update on the special meeting. 
The update suggests several potential bidders and enough shareholders with the required record date to convene the special meeting to appoint independent directors. 
The MBO proposal, while potentially a delaying tactic, suggests that the Board are under pressure for a solution and is aiming for a friendly takeover. 


Hollysys (HOLI US): MBO Proposal and Updates

France

Schneider Electric SE manufactures power distribution and automation systems. The Company produces circuit breakers, remote installation management equipment, panelboards, programmable logic controllers, industrial control products, detectors, human-machine interfaces, and process controls.  Schneider's products are sold various brands.

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Schneider Electric Se (SU FP)

Hollysys (HOLI US): Questionable Process Results in Ascendent’s Winning US$26.50 Bid

Despite a dubious sales process, deal fatigue and the 42% premium to the undisturbed price should help get the vote up. At the last close, the...

Arun George

Bullish Outlook Intact; Upgrading Brazil to Overweight; Buying Global Gold/Silver Miners + More Buys

Our bullish outlook on global equities $ACWI remains intact. We are also upgrading Brazil $EWZ to overweight. We continue to expect a rally into...

Vermilion Research

Hollysys (HOLI US): Progress as a Binding Proposal Targeted for Mid-December

An SEC filing on Friday disclosed that Ascendent Capital (13.7% shareholder) entered a confidentiality agreement with Hollysys, which includes a...

Arun George

Hollysys (HOLI US): Ascendent Capital Joins the Fray

The Recco consortium has bumped its non-binding offer to US$26.50 per share, 1.9% higher than Ascendent’s offer. Recco notes that “shareholders...

Arun George

Hollysys (HOLI US): MBO Proposal and Updates

The MBO proposal, while potentially a delaying tactic, suggests that the Board are under pressure for a solution and is aiming for a friendly...

Arun George

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