Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<a href="https://www.smartkarma.com/entities/scientific-games-corp-a" target="_blank" data-smartkarma-citation="entities:9746:1" rel="noopener">Scientific Games Corp A (SGMS US)</a> aims to raise around US$3.7bn (A$5bn) via selling a majority of its stake in SG Lottery (SGL) in an Australian IPO.SGL runs a global lottery business supplying lottery products and services across the lottery ecosystem. It works with various governments globally who use its products and services to run their lotteries. As of FY20, SGL had more than 130 customers in over 50 countries. Revenue from North America and Europe accounted for 73% and 24% of its FY20 revenue, respectively.SGL generates most of its sales from instant lottery products. It has supplied instant lottery products to 40 of the 46 US jurisdictions that sell instant lottery products and has sold instant lottery products to customers in approximately 50 countries. Its  relationship with its top 10 customers have been ongoing for an average 35 years.SGL has been reporting steady past growth and margins have been relatively stable as well.

Scientific Games Corp A (SGMS US) aims to raise around US$3.7bn (A$5bn) via selling a majority of its stake in SG Lottery (SGL) in an Australian IPO.SGL runs a global lottery business supplying lottery products and services across the lottery ecosystem. It works with various governments globally who use its products and services to run their lotteries. As of FY20, SGL had more than 130 customers in over 50 countries. Revenue from North America and Europe accounted for 73% and 24% of its FY20 revenue, respectively.SGL generates most of its sales from instant lottery products. It has supplied instant lottery products to 40 of the 46 US jurisdictions that sell instant lottery products and has sold instant lottery products to customers in approximately 50 countries. Its  relationship with its top 10 customers have been ongoing for an average 35 years.SGL has been reporting steady past growth and margins have been relatively stable as well.

SG Lottery Pre-IPO - First Look at Possibly Australia’s Largest IPO in 2021

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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Construction materials testing company <a href="https://www.smartkarma.com/entities/intega-group-ltd" target="_blank" data-smartkarma-citation="entities:30558:1" rel="noopener">Intega Group Ltd (ITG AU)</a> has <a href="https://www.asx.com.au/asxpdf/20211004/pdf/4517hssbst3c5v.pdf" target="_blank" rel="noopener">announced</a> it has entered into a Scheme Implementation Deed (SID) with Dutch outfit Kiwa. 
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The SID is struck at A$0.90/share, a 58% premium to last close. The deal is the culmination of strategic review announced on the <a href="https://www.asx.com.au/asxpdf/20210609/pdf/44x7brvr82sqt2.pdf" target="_blank" rel="noopener">9 June</a> to "maximise value" for its shareholders.
Apart from the standard shareholder approval attached to a Scheme, the transaction is subject to FIRB approval. Should that regulatory approval not occur before 31 December 2021, Intega is permitted to pay a special dividend of A$2.3mn each month (~A$0.005/share) between 1 January 2022 and 30 June 2022. These dividends will be in addition to the A$0.90/share cash consideration.
Crescent Capital Partners, with 52.1% of shares out, supports the SID and will vote in favour.
This looks done (with an expected completion mid-December) and should trade tight to terms.
More below the fold. 
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Construction materials testing company Intega Group Ltd (ITG AU) has announced it has entered into a Scheme Implementation Deed (SID) with Dutch outfit Kiwa. 


The SID is struck at A$0.90/share, a 58% premium to last close. The deal is the culmination of strategic review announced on the 9 June to "maximise value" for its shareholders.
Apart from the standard shareholder approval attached to a Scheme, the transaction is subject to FIRB approval. Should that regulatory approval not occur before 31 December 2021, Intega is permitted to pay a special dividend of A$2.3mn each month (~A$0.005/share) between 1 January 2022 and 30 June 2022. These dividends will be in addition to the A$0.90/share cash consideration.
Crescent Capital Partners, with 52.1% of shares out, supports the SID and will vote in favour.
This looks done (with an expected completion mid-December) and should trade tight to terms.
More below the fold. 





Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Sandfire Resources Limited / Event-Driven

On 23 September pre-market open, <a href="https://www.smartkarma.com/entities/sandfire-resources-limited" target="_blank" data-smartkarma-citation="entities:1259:1" rel="noopener">Sandfire Resources Limited (SFR AU)</a> requested for a trading halt. A short time later, the company announced the acquisition of the MATSA mining complex from Mubadala and Trafigura for US$1.865bn (A$2.572bn).The acquisition is expected to be completed in the March 2022 quarter and is subject to Spanish Foreign Direct Investment Approval and anti-trust merger control approval.The acquisition will be funded by an A$120m strategic placement to AustralianSuper, a A$165m institutional placement, a A$963m fully underwritten 1 for 1 accelerated non-renounceable entitlement offer (ANREO), debt and cash on hand.Just over 231m shares will be issued at A$5.40/share, a 13.2% discount to the last close of A$6.22/share, and a 6.2% discount to TERP.The increase in market cap as a result of the placement and entitlement offer will result in <a href="https://www.smartkarma.com/entities/sandfire-resources-limited" target="_blank" data-smartkarma-citation="entities:1259:1" rel="noopener">Sandfire Resources Limited (SFR AU)</a> becoming a high probability inclusion to the <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> at the December rebalance.With a number of M&amp;A deals targeting <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> constituents, there will be more changes to the index over the next couple of regular rebalances (and in the interim as well).

On 23 September pre-market open, Sandfire Resources Limited (SFR AU) requested for a trading halt. A short time later, the company announced the acquisition of the MATSA mining complex from Mubadala and Trafigura for US$1.865bn (A$2.572bn).The acquisition is expected to be completed in the March 2022 quarter and is subject to Spanish Foreign Direct Investment Approval and anti-trust merger control approval.The acquisition will be funded by an A$120m strategic placement to AustralianSuper, a A$165m institutional placement, a A$963m fully underwritten 1 for 1 accelerated non-renounceable entitlement offer (ANREO), debt and cash on hand.Just over 231m shares will be issued at A$5.40/share, a 13.2% discount to the last close of A$6.22/share, and a 6.2% discount to TERP.The increase in market cap as a result of the placement and entitlement offer will result in Sandfire Resources Limited (SFR AU) becoming a high probability inclusion to the S&amp;P/ASX 200 (AS51 INDEX) at the December rebalance.With a number of M&amp;A deals targeting S&amp;P/ASX 200 (AS51 INDEX) constituents, there will be more changes to the index over the next couple of regular rebalances (and in the interim as well).

Sandfire Resources (SFR AU): Acquisition, ANREO and ASX200 Inclusion

On 20 September, <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> announced that it had received an unsolicited, indicative, non-binding and conditional proposal from the infrastructure affiliate of <a href="https://www.smartkarma.com/entities/brookfield-asset-manage-cl-a-0483cfb5-71a5-4931-af80-901e5f30aace" target="_blank" data-smartkarma-citation="entities:23741:1" rel="noopener">Brookfield Asset Management (BAM US)</a> to acquire all the shares in <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> via a Scheme of Arrangement at an indicative price of A$2.50/share in cash.<a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> finished the day 19.2% higher at A$2.36 on volumes that were nearly 3 times the ADV.In a surprising development, earlier today, <a href="https://www.smartkarma.com/entities/apa-group" target="_blank" data-smartkarma-citation="entities:18658:1" rel="noopener">APA Group (APA AU)</a> announced that it has made a non-binding indicative proposal to acquire all the shares in <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> via a Scheme of Arrangement at an indicative price of A$2.60/share in cash and scrip.What makes this even more surprising is that <a href="https://www.smartkarma.com/entities/apa-group" target="_blank" data-smartkarma-citation="entities:18658:1" rel="noopener">APA Group (APA AU)</a> and <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> were in discussions earlier. <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> knew that a revised offer from <a href="https://www.smartkarma.com/entities/apa-group" target="_blank" data-smartkarma-citation="entities:18658:1" rel="noopener">APA Group (APA AU)</a> was forthcoming, yet went ahead and gave Brookfield an 8 week period of exclusivity for due diligence.<a href="https://www.smartkarma.com/entities/apa-group" target="_blank" data-smartkarma-citation="entities:18658:1" rel="noopener">APA Group (APA AU)</a> has clearly laid out why its proposal is superior to the proposal from <a href="https://www.smartkarma.com/entities/brookfield-asset-manage-cl-a-0483cfb5-71a5-4931-af80-901e5f30aace" target="_blank" data-smartkarma-citation="entities:23741:1" rel="noopener">Brookfield Asset Management (BAM US)</a> and this could get interesting with a possibility of even higher bids coming in for <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a>.<a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a> is a member of the S&amp;P/ASX 100, <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> and S&amp;P/ASX 300 Indices. Once the stock is delisted, it will be replaced in the indices with the highest ranking stocks that are not part of the index. With the wave of ongoing M&amp;A activity, there will be a lot of additions to the indices in the next few months.

On 20 September, Ausnet Services (AST AU) announced that it had received an unsolicited, indicative, non-binding and conditional proposal from the infrastructure affiliate of Brookfield Asset Management (BAM US) to acquire all the shares in Ausnet Services (AST AU) via a Scheme of Arrangement at an indicative price of A$2.50/share in cash.Ausnet Services (AST AU) finished the day 19.2% higher at A$2.36 on volumes that were nearly 3 times the ADV.In a surprising development, earlier today, APA Group (APA AU) announced that it has made a non-binding indicative proposal to acquire all the shares in Ausnet Services (AST AU) via a Scheme of Arrangement at an indicative price of A$2.60/share in cash and scrip.What makes this even more surprising is that APA Group (APA AU) and Ausnet Services (AST AU) were in discussions earlier. Ausnet Services (AST AU) knew that a revised offer from APA Group (APA AU) was forthcoming, yet went ahead and gave Brookfield an 8 week period of exclusivity for due diligence.APA Group (APA AU) has clearly laid out why its proposal is superior to the proposal from Brookfield Asset Management (BAM US) and this could get interesting with a possibility of even higher bids coming in for Ausnet Services (AST AU).Ausnet Services (AST AU) is a member of the S&amp;P/ASX 100, S&amp;P/ASX 200 (AS51 INDEX) and S&amp;P/ASX 300 Indices. Once the stock is delisted, it will be replaced in the indices with the highest ranking stocks that are not part of the index. With the wave of ongoing M&amp;A activity, there will be a lot of additions to the indices in the next few months.

AusNet (AST AU): Bidding War Between Brookfield & APA Brewing?

S&amp;P Dow Jones Indices will announce changes to the S&amp;P/ASX 100 and <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> as part of the December index review on 3 December and the changes will be effective after the close of trading on 17 December.The review period for the rebalance ends on 19 November, so we are exactly two-thirds of the way through the review period.As of the close on 20 September, we see <a href="https://www.smartkarma.com/entities/pilbara-minerals-ltd" target="_blank" data-smartkarma-citation="entities:7460:1" rel="noopener">Pilbara Minerals (PLS AU)</a> as a potential inclusion to the S&amp;P/ASX100 and <a href="https://www.smartkarma.com/entities/link-administration-holdings-ltd" target="_blank" data-smartkarma-citation="entities:970:1" rel="noopener">Link Administration Holdings (LNK AU)</a> as a potential deletion.For the <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a>, potential inclusions are <a href="https://www.smartkarma.com/entities/imugene-ltd" target="_blank" data-smartkarma-citation="entities:20276:1" rel="noopener">Imugene Ltd (IMU AU)</a>, <a href="https://www.smartkarma.com/entities/paladin-energy-ltd" target="_blank" data-smartkarma-citation="entities:10117:1" rel="noopener">Paladin Energy (PDN AU)</a>, <a href="https://www.smartkarma.com/entities/amalgamated-holdings-ltd" target="_blank" data-smartkarma-citation="entities:20978:1" rel="noopener">Event Hospitality and Entertainment (EVT AU)</a>, <a href="https://www.smartkarma.com/entities/liontown-resources-ltd" target="_blank" data-smartkarma-citation="entities:20488:1" rel="noopener">Liontown Resources (LTR AU)</a> and <a href="https://www.smartkarma.com/entities/arena-reit" target="_blank" data-smartkarma-citation="entities:12209:1" rel="noopener">Arena Reit (ARF AU)</a>, while potential deletions are <a href="https://www.smartkarma.com/entities/kogan-com-ltd" target="_blank" data-smartkarma-citation="entities:23575:1" rel="noopener">Kogan.com (KGN AU)</a>, <a href="https://www.smartkarma.com/entities/redbubble-ltd" target="_blank" data-smartkarma-citation="entities:24321:1" rel="noopener">Redbubble Ltd (RBL AU)</a>, <a href="https://www.smartkarma.com/entities/monadelphous-group-ltd" target="_blank" data-smartkarma-citation="entities:553:1" rel="noopener">Monadelphous (MND AU)</a>, <a href="https://www.smartkarma.com/entities/omni-bridgeway-ltd" target="_blank" data-smartkarma-citation="entities:8840:1" rel="noopener">Imf Bentham Ltd (OBL AU)</a> and <a href="https://www.smartkarma.com/entities/spark-new-zealand-ltd-3dcc706a-f086-4dd4-882b-2a42a36ccf8d" target="_blank" data-smartkarma-citation="entities:26915:1" rel="noopener">Spark New Zealand (SPK AU)</a>.With multiple M&amp;A deal pending, including <a href="https://www.smartkarma.com/entities/afterpay-limited" target="_blank" data-smartkarma-citation="entities:26940:1" rel="noopener">Afterpay Touch (APT AU)</a>, <a href="https://www.smartkarma.com/entities/sydney-airport" target="_blank" data-smartkarma-citation="entities:19063:1" rel="noopener">Sydney Airport (SYD AU)</a>, <a href="https://www.smartkarma.com/entities/ausnet-services" target="_blank" data-smartkarma-citation="entities:10293:1" rel="noopener">Ausnet Services (AST AU)</a>, <a href="https://www.smartkarma.com/entities/oil-search-ltd" target="_blank" data-smartkarma-citation="entities:773:1" rel="noopener">Oil Search Ltd (OSH AU)</a> and <a href="https://www.smartkarma.com/entities/spark-infrastructure-group" target="_blank" data-smartkarma-citation="entities:595:1" rel="noopener">Spark Infrastructure (SKI AU)</a>, there could be more additions to the index if deals are completed or highly likely to be completed by end November.Short interest on most potential inclusions is quite low, while the short interest on many potential exclusions is quite high.

S&amp;P Dow Jones Indices will announce changes to the S&amp;P/ASX 100 and S&amp;P/ASX 200 (AS51 INDEX) as part of the December index review on 3 December and the changes will be effective after the close of trading on 17 December.The review period for the rebalance ends on 19 November, so we are exactly two-thirds of the way through the review period.As of the close on 20 September, we see Pilbara Minerals (PLS AU) as a potential inclusion to the S&amp;P/ASX100 and Link Administration Holdings (LNK AU) as a potential deletion.For the S&amp;P/ASX 200 (AS51 INDEX), potential inclusions are Imugene Ltd (IMU AU), Paladin Energy (PDN AU), Event Hospitality and Entertainment (EVT AU), Liontown Resources (LTR AU) and Arena Reit (ARF AU), while potential deletions are Kogan.com (KGN AU), Redbubble Ltd (RBL AU), Monadelphous (MND AU), Imf Bentham Ltd (OBL AU) and Spark New Zealand (SPK AU).With multiple M&amp;A deal pending, including Afterpay Touch (APT AU), Sydney Airport (SYD AU), Ausnet Services (AST AU), Oil Search Ltd (OSH AU) and Spark Infrastructure (SKI AU), there could be more additions to the index if deals are completed or highly likely to be completed by end November.Short interest on most potential inclusions is quite low, while the short interest on many potential exclusions is quite high.

ASX100/​200 Index Rebalance Preview: Potential December Changes With Large Impact

Australia

Sydney Airport operates the Sydney, Australia airport. The Company develops and maintains the airport infrastructure and leases terminal space to airlines and retailers.

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Sydney Airport (SYD AU)

SG Lottery Pre-IPO - First Look at Possibly Australia’s Largest IPO in 2021

Scientific Games Corp A (SGMS US) aims to raise around US$3.7bn (A$5bn) via selling a majority of its stake in SG Lottery (SGL) in an Australian IPO.

Sumeet Singh

Intega (ITG AU) Enters Scheme With Kiwa

This is done. Trading at a gross/annualised spread of 2.8%/15.4%. That looks attractive, although this is not a very liquid arb situation.

David Blennerhassett

Sandfire Resources (SFR AU): Acquisition, ANREO and ASX200 Inclusion

Sandfire Resources is buying the MATSA mine in Spain and conducting a placement and entitlement offer to raise funds. This will lead to a big jump...

Brian Freitas

AusNet (AST AU): Bidding War Between Brookfield & APA Brewing?

Yesterday, Brookfield made an offer for AusNet at A$2.5/share in cash. Today, APA Group made an offer at A$2.6/share in cash + scrip. This could go...

Brian Freitas

ASX100/200 Index Rebalance Preview: Potential December Changes With Large Impact

There could be 1 change to the ASX100 and 5 changes to the ASX200 at the December rebalance. With a long M&A pipeline, there could be additional...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

SG Lottery Pre-IPO - First Look at Possibly Australia’s Largest IPO in 2021

Scientific Games Corp A (SGMS US) aims to raise around US$3.7bn (A$5bn) via selling a majority of its stake in SG Lottery (SGL) in an Australian IPO.

Sumeet Singh

Intega (ITG AU) Enters Scheme With Kiwa

This is done. Trading at a gross/annualised spread of 2.8%/15.4%. That looks attractive, although this is not a very liquid arb situation.

David Blennerhassett

Sandfire Resources (SFR AU): Acquisition, ANREO and ASX200 Inclusion

Sandfire Resources is buying the MATSA mine in Spain and conducting a placement and entitlement offer to raise funds. This will lead to a big jump...

Brian Freitas

AusNet (AST AU): Bidding War Between Brookfield & APA Brewing?

Yesterday, Brookfield made an offer for AusNet at A$2.5/share in cash. Today, APA Group made an offer at A$2.6/share in cash + scrip. This could go...

Brian Freitas

ASX100/​200 Index Rebalance Preview: Potential December Changes With Large Impact

There could be 1 change to the ASX100 and 5 changes to the ASX200 at the December rebalance. With a long M&A pipeline, there could be additional...

Brian Freitas

ASX100/200 Index Rebalance Preview: Potential December Changes With Large Impact