Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>RMB dual counter started trading. <a href="https://www.smartkarma.com/entities/great-wall-motor-co-ltd-cb302af9-398c-4d2d-ba39-023e43287eef" target="_blank" data-smartkarma-citation="entities:128:1" rel="noopener">Great Wall Motor (2333 HK)</a>'s A-shares trade at 3x the multiple. THAT is a big discount to harvest. </li>
<li>
<a href="https://www.smartkarma.com/entities/china-feihe-ltd" target="_blank" data-smartkarma-citation="entities:24413:1" rel="noopener">China Feihe (6186 HK)</a>'s CFO exits an indirect stake of 6.38% around Feihe's all-time low. </li>
<li>
<a href="https://www.smartkarma.com/entities/ecopro-co-ltd" target="_blank" data-smartkarma-citation="entities:19029:1" rel="noopener">EcoPro Co Ltd (086520 KS)</a> has swatted aside analyst downgrades and the indictment of its chairman to touch an all-time high</li>
</ul>


RMB dual counter started trading. Great Wall Motor (2333 HK)'s A-shares trade at 3x the multiple. THAT is a big discount to harvest. 

China Feihe (6186 HK)'s CFO exits an indirect stake of 6.38% around Feihe's all-time low. 

EcoPro Co Ltd (086520 KS) has swatted aside analyst downgrades and the indictment of its chairman to touch an all-time high


Last Week in Event SPACE: Great Wall Motor, China Feihe, EcoPro, PCCW

European Event-Driven Analyst

Jesus Rodriguez Aguilar

<ul>
<li>Silver Lake announced it waived the minimum acceptance threshold of 50% + 1 share in  its offer for <a href="https://www.smartkarma.com/entities/software-ag" target="_blank" data-smartkarma-citation="entities:21717:1" rel="noopener">Software AG (SOW GR)</a> . The acceptance period has been extended until 28 June.</li>
<li>Bain Capital abandons the pursuit and will sell its 10.01% stake to Silver Lake, which will now controls 41%, plus another 10% from a convertible bond.</li>
<li>Silver Lake is now pressing the minority shareholders to tender. Spread is 1.44%/15.13% (gross/annualised), assuming settlement on 31 July. I believe that Silver Lake will be successful. Long and tender.</li>
</ul>


Silver Lake announced it waived the minimum acceptance threshold of 50% + 1 share in  its offer for Software AG (SOW GR) . The acceptance period has been extended until 28 June.
Bain Capital abandons the pursuit and will sell its 10.01% stake to Silver Lake, which will now controls 41%, plus another 10% from a convertible bond.
Silver Lake is now pressing the minority shareholders to tender. Spread is 1.44%/15.13% (gross/annualised), assuming settlement on 31 July. I believe that Silver Lake will be successful. Long and tender.


Silver Lake/Software AG: Bain Clears the Way

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

<ul>
<li>The June 2023 index changes for the DAX index family were confirmed after the close yesterday.</li>
<li>As expected, there were no changes announced for the DAX index.</li>
<li>There will be four changes for MDAX, one change for SDAX, and one change for TecDAX.</li>
</ul>


The June 2023 index changes for the DAX index family were confirmed after the close yesterday.
As expected, there were no changes announced for the DAX index.
There will be four changes for MDAX, one change for SDAX, and one change for TecDAX.


Quiddity Flow Expectations for DAX Jun 23 Rebal: Evotec Is the Main Surprise

<ul>
<li>In this insight, we take a look at Quiddity's estimates for the names leading the race to become ADDs/DELETEs for the DAX, MDAX, and SDAX Indices.</li>
<li>As things stand, there will not be any ADDs or DELs from the DAX index or the SDAX index.</li>
<li>There could be two ADDs/DELs for the MDAX index in the June 2023 rebalance.</li>
</ul>


In this insight, we take a look at Quiddity's estimates for the names leading the race to become ADDs/DELETEs for the DAX, MDAX, and SDAX Indices.
As things stand, there will not be any ADDs or DELs from the DAX index or the SDAX index.
There could be two ADDs/DELs for the MDAX index in the June 2023 rebalance.


Quiddity Leaderboard-DAX Jun 23: Two Changes for the MDAX Index

<ul>
<li>Bain goes mildly hostile, with a €34/share indicative offer (20.5x EV/Fwd EBIT on IBES consensus), above 11.1x last-10y average. Further, if it fully succeeded, it'd raise to €36/share (21.6x).</li>
<li>Software AG dislikes the improved indicative offer. The situation reminds of the battle for <a href="https://www.smartkarma.com/entities/caverion-corp" target="_blank" data-smartkarma-citation="entities:21753:1" rel="noopener">Caverion Corp (CAV1V FH)</a>, now being played, in which precisely Bain has been the unexpected loser.</li>
<li>At this point, it seems Silver Lake will have to raise its offer again. I raise my TP to €34. Long (possible upside to Bain's €36/share, 6.1% gross).</li>
</ul>


Bain goes mildly hostile, with a €34/share indicative offer (20.5x EV/Fwd EBIT on IBES consensus), above 11.1x last-10y average. Further, if it fully succeeded, it'd raise to €36/share (21.6x).
Software AG dislikes the improved indicative offer. The situation reminds of the battle for Caverion Corp (CAV1V FH), now being played, in which precisely Bain has been the unexpected loser.
At this point, it seems Silver Lake will have to raise its offer again. I raise my TP to €34. Long (possible upside to Bain's €36/share, 6.1% gross).


Germany

TeamViewer AG operates as a holding company for TeamViewer Group which is operating a global connectivity platform. TeamViewer offers software solutions to remotely access and connect any computer, tablet, laptop, mobile device, and IoT endpoint such as industrial machines to allow remote control, management, and monitoring of devices as well as interaction and collaboration.

EQS Group AG provides online corporate communications services. The Company's services include financial disclosure, distribution of press releases, corporate websites, financial portals, webcasts, online reports and mobile platforms.

CANCOM SE is an integrated information technology (IT) services provider. The Company provides IT products and services. CANCOM's products and services include security, network and system solutions, communication, storage, backup and archive services, and IT management.

The Naga Group AG designs and produces application software. The Company conceptualizes, develops, and launches technology ventures for financial industries. Naga Group serves customers in Germany.

GFT Technologies SE offers software development and consulting services to clients primarily in the area of web-based IT systems. The Company offers IT-business consulting, digital design, system implementation, and support services. GFT Technologies also provides customer training.

Bechtle AG retails computer and office supplies.  The Company markets personal computers, workstations, computer peripherals, mobile devices, computer software, computer networking products, presentation equipment, paper, computer consumables, office furniture, and telecommunications equipment.  Bechtle sells its products through its catalog and Internet website.

SNP Schneider-Neureither & Partner AG provides software and software related services for the business landscape transformation. The Company's software is used by businesses to implement changes to their IT landscape, business processes and structures. SNP also offer consulting services.

Snp Schneider-Neureither & Partner Ag (SHF GY)

Datagroup SE provides information technology services. The Company offers data center, application development, IT consulting, and other related services. Datagroup operates worldwide.

Siltronic AG manufactures hyperpure silicon wafers. The Company offers products including non-polished and epitaxial coated wafers with different diameter sizes. Siltronic caters its products worldwide for use in computers, smartphones, flat-panel displays, navigation systems, automotive engine control systems, and many other applications.

Aixtron SE engineers and manufactures metal organic chemical vapor deposition (MOCVD) equipment for the semiconductor industry.  The Company's customers use its equipment to produce compound semiconductor layer structures for use in LED, laser, solar cell, transistor, telecommunications, and other applications. Aixtron markets its products worldwide.

Kingdee International Software Group Company Limited, through its subsidiaries, develops and sells enterprise management software, e-commerce application software and middleware software.  The Company also provides internet-based services and setting up e-commerce platforms for enterprises. In addition, Kingdee provides solution consulting and technical support services.

Kingsoft Corporation Ltd. develops and markets computer software.  The Company develops role-playing computer games and security, word processing, and spreadsheet software.

Beijing Venustech Inc. provides a variety of information security products, information security services and information security solutions.  The Company's products and services are intrusion detection systems, intrusion prevention systems, firewalls, real-time monitoring and security management certification training services.

Jiangsu Hoperun Software Company Limited provides software outsourcing services for professional fields. The Company's main products include supply chain management software, intelligent terminal embedded software, and smart grid IT software outsourcing services.

Sapiens International Corporation N.V. is a global provider of information technology (IT) solutions. The Company's solutions modernize business processes and enable insurance organizations and other companies to adapt quickly to change. Sapiens modular solutions align IT with the business demands for speed, flexibility, and efficiency.

NCSOFT Corporation develops and markets on-line games that enable users to play over the Internet and computer software, such as web editing software.  The Company also designs and constructs databases, Intranet, and commercial Internet access systems.

RingCentral, Inc. is a provider of software-as-a-service, or SaaS, solutions for business communications. The Company offers a multi-user, enterprise-grade communications solution that enables customers and their employees to communicate via voice, text, HD video and web conferencing and fax, on multiple devices, including smartphones, tablets, PCs and desk phones.

Beijing Shiji Information Technology Co.,Ltd. develops and sells management information system software for the Hotel industry. The Company also provides IT system integration and IT technology support services.

Beijing Shiji Information Technology Co., Ltd. (002153 CH)

Beijing Shiji Information Technology Co., Ltd.

Progress Software Corporation develops, markets, and distributes application development, deployment, and integration software to business, industry, and government worldwide.  The Company's products include databases, application servers, messaging servers, and development tools for Internet/Web, extranet, and intranet applications as well as for client/server and host applications.

Glodon Company Limited develops application softwares for basic construction industry. The Company's products include construction engineering cost management software and project cost management software. The Company also provides related training and consulting services.

Software AG operates as a software development company. The Company enables enterprises to integrate, connect, and manage IoT components, as well as analyze data and predict future events based on artificial intelligence. Software serves customers worldwide.

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Software (SOW GR)

Last Week in Event SPACE: Great Wall Motor, China Feihe, EcoPro, PCCW

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David Blennerhassett

Silver Lake/Software AG: Bain Clears the Way

With the minimum acceptance condition dropped and Bain selling its 10% to Silver Lake, the takeover seems clear. The market has reluctantly...

Jesus Rodriguez Aguilar

Quiddity Flow Expectations for DAX Jun 23 Rebal: Evotec Is the Main Surprise

Drug discovery company Evotec AG (EVT GR) was a surprise addition to the MDAX index. The stock was previously an ineligible candidate but its...

Janaghan Jeyakumar, CFA

Quiddity Leaderboard-DAX Jun 23: Two Changes for the MDAX Index

There are seven days left in the reference period. The index changes will be confirmed after the close on 5th June 2023 and the inclusions...

Janaghan Jeyakumar, CFA

Rocket Software (Bain) Ups the Game

On late evening 9 May, Rocket Software, a US competitor controlled by Bain Capital, submitted a revised legally non-binding expression of interest...

Jesus Rodriguez Aguilar

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