Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Back on the 17 February, <a href="https://www.smartkarma.com/entities/aag-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:501:1" rel="noopener">AAG Energy Holdings (2686 HK)</a> announced an underwhelming Offer of HK$1.85/share (declared final) by way of a Scheme from major shareholder <a href="https://www.smartkarma.com/entities/xinjiang-xintai-natural-gas-a" target="_blank" data-smartkarma-citation="entities:27036:1" rel="noopener">Xinjiang Xintai (603393 CH)</a>.</li>
<li>Yesterday, Xinjiang Xintai shareholders approved the proposal. This was expected - it's a total bargain. </li>
<li>AAG shareholders will likely get to vote on the Scheme in early May. They should vote it down.</li>
</ul>


Back on the 17 February, AAG Energy Holdings (2686 HK) announced an underwhelming Offer of HK$1.85/share (declared final) by way of a Scheme from major shareholder Xinjiang Xintai (603393 CH).
Yesterday, Xinjiang Xintai shareholders approved the proposal. This was expected - it's a total bargain. 
AAG shareholders will likely get to vote on the Scheme in early May. They should vote it down.


AAG Energy (2686 HK): Pre-Cons Done. Still A Rubbish Offer

<ul>
<li>On the 17 February, <a href="https://www.smartkarma.com/entities/aag-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:501:1" rel="noopener">AAG Energy Holdings (2686 HK)</a> announced an Offer of HK$1.85/share (declared final) by way of a Scheme from major shareholder <a href="https://www.smartkarma.com/entities/xinjiang-xintai-natural-gas-a" target="_blank" data-smartkarma-citation="entities:27036:1" rel="noopener">Xinjiang Xintai Natural Gas (603393 CH).</a>
</li>
<li>At a 10.1% premium to undisturbed and just a 2.2% premium over the highest closing price of HK$1.81/share in the past year, the Consideration price was unreasonable. </li>
<li>FY22 numbers are now out, which further illustrates the Offer price's inadequacy. AAG's trailing PER and EV/EBITDA are  3.6x and 1.4x. Net cash accounts for 41% of AAG's market cap.</li>
</ul>


On the 17 February, AAG Energy Holdings (2686 HK) announced an Offer of HK$1.85/share (declared final) by way of a Scheme from major shareholder Xinjiang Xintai Natural Gas (603393 CH).

At a 10.1% premium to undisturbed and just a 2.2% premium over the highest closing price of HK$1.81/share in the past year, the Consideration price was unreasonable. 
FY22 numbers are now out, which further illustrates the Offer price's inadequacy. AAG's trailing PER and EV/EBITDA are  3.6x and 1.4x. Net cash accounts for 41% of AAG's market cap.


AAG Energy (2686 HK): Full-Year Results Lay Bare Xinjiang Xintai's Low-Balled Offer

<ul>
<li>On the 14 May 2018, coalbed methane producer <a href="https://www.smartkarma.com/entities/aag-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:501:1" rel="noopener">AAG Energy Holdings (2686 HK)</a> announced a partial offer (50.5%) from <a href="https://www.smartkarma.com/entities/xinjiang-xintai-natural-gas-a" target="_blank" data-smartkarma-citation="entities:27036:1" rel="noopener">Xinjiang Xintai Natural Gas (603393 CH)</a> at HK$1.75/share. </li>
<li>Xinjiang Xintai has returned to the pit with a $1.85/share Offer by way of a Scheme. The Cancellation Price will NOT be increased.</li>
<li>This is hardly a knockout price, at a 10.1% premium to undisturbed; and just a 2.2% premium over the highest closing price of HK$1.81/share in the past year.</li>
</ul>


On the 14 May 2018, coalbed methane producer AAG Energy Holdings (2686 HK) announced a partial offer (50.5%) from Xinjiang Xintai Natural Gas (603393 CH) at HK$1.75/share. 
Xinjiang Xintai has returned to the pit with a $1.85/share Offer by way of a Scheme. The Cancellation Price will NOT be increased.
This is hardly a knockout price, at a 10.1% premium to undisturbed; and just a 2.2% premium over the highest closing price of HK$1.81/share in the past year.


AAG Energy (2686 HK): Xinjiang Xintai 's Underwhelming Scheme Offer

<ul>
<li>Back on the 14 May 2018, <a href="https://www.smartkarma.com/entities/aag-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:501:1" rel="noopener">AAG Energy Holdings (2686 HK)</a> <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2018/0514/ltn201805141016.pdf" target="_blank" rel="noopener">announced</a> a partial offer (50.5%) from <a href="https://www.smartkarma.com/entities/xinjiang-xintai-natural-gas-a" target="_blank" data-smartkarma-citation="entities:27036:1" rel="noopener">Xinjiang Xintai Natural Gas (603393 CH)</a> at HK$1.75/share. </li>
<li>This morning AAG was suspended pursuant to Hong Kong Code on Takeovers and Mergers.</li>
<li>I expect a Scheme Offer from Xinjiang Xintai, which currently holds 56.98%. Potentially, <a href="https://www.smartkarma.com/entities/fosun-international-ltd" target="_blank" data-smartkarma-citation="entities:433:1" rel="noopener">Fosun (656 HK)</a> has returned to the well.</li>
</ul>


Back on the 14 May 2018, AAG Energy Holdings (2686 HK) announced a partial offer (50.5%) from Xinjiang Xintai Natural Gas (603393 CH) at HK$1.75/share. 
This morning AAG was suspended pursuant to Hong Kong Code on Takeovers and Mergers.
I expect a Scheme Offer from Xinjiang Xintai, which currently holds 56.98%. Potentially, Fosun (656 HK) has returned to the well.


AAG Energy (2686 HK) Suspended: Xinjiang Xintai Offer?

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Hungary: Faster earnings growth should drive GDP higher in coming months. Mexico: Expected to raise rates 50bps next Thursday in the wake of inflation reported this week at 5.3% (the highest rate in 8 years).  This is a critical positive development for the Peso. Saudi Arabia: Has the most to lose from lower prices as this complicates attempts to diversify their economy.  Iran is less concerned as they are just coming off of sanctions and any revenue they get is better than before.  Iraq would…

Who Wins and Who Loses from Oil Under $50? Hint: Invest in Asia

China

Taiyuan Coal Gasification Co., Ltd. produces and markets coal, coke, gas, and related chemical products.  The Company's products are supplied  to north China and east China areas.

Taiyuan Coal Gasification Company, (000968 CH)

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Taiyuan Coal Gasification Company, (000968 CH)

AAG Energy (2686 HK): Pre-Cons Done. Still A Rubbish Offer

I would vote down this Scheme. I would, however, still buy here given the low Offer premium and limited downside. Currently trading at HK$1.62...

David Blennerhassett

AAG Energy (2686 HK): Full-Year Results Lay Bare Xinjiang Xintai's Low-Balled Offer

I would vote down this Scheme. I would, however, still buy here given the low Offer premium and limited downside. Currently trading at HK$1.67...

David Blennerhassett

AAG Energy (2686 HK): Xinjiang Xintai 's Underwhelming Scheme Offer

A 10.1% premium compares to the Offer price premiums for Sino Gas and Senex of 19% and 25%. I 'd still buy here given the low Offer premium and...

David Blennerhassett

AAG Energy (2686 HK) Suspended: Xinjiang Xintai Offer?

If simply using the average premium to last close in HK takeovers of 37% in 2022, then an Offer price of ~HK$2.30 is feasible, which is a lifetime...

David Blennerhassett

Who Wins and Who Loses from Oil Under $50? Hint: Invest in Asia

Hungary: Faster earnings growth should drive GDP higher in coming months.Mexico: Expected to raise rates 50bps next Thursday in the wake of...

David Riedel

Price Gauge

52-week Range

Market Cap (USDm)

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