Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven


For the month of May, 11 new deals were discussed on Smartkarma with an overall announced deal size of ~US$7.3bn.



Clicking on the company name in the table below will take you to the entity page where you can read the initial insight(s) written by Smartkarma contributors on these new deals and follow-up discussions, or simply click on the insight link(s) below the name.







New Deals


Industry


Size (US$bn)


Type


Premium




Australia




APN Property Group (APD AU) 
Property
0.2
Scheme
50%


APN Prop (APD AU): Dexus' Done Deal



Boral Ltd (BLD AU) 
Construction
4.8
Off-market
Nil


Boral Ltd (BLD AU): Seven's Nil Premium



Japara Healthcare (JHC AU) 
Healthcare
0.2
Scheme
30%


Japara Healthcare (JHC AU): Here Comes The Calvary


 



Hong Kong




Chong Hing Bank (1111 HK) 
Banking
0.2
Scheme
51.2%



Chong Hing Bank (1111 HK): Takeover Talk As Shares Pop
Chong Hing Bank (1111 HK): Yue Xiu's Offer Is Light



 



Japan




Aomori Bank (8342 JP) / Michinoku Bank (8350 JP) 
Bank
0.6
Merger



Aomori Bank &amp; Michinoku Bank Merger - Nothing To Write Home About Yet



EPS Holdings (4282 JP) 
Data/software
0.1
Tender Offer
35.5%


Another Too-Cheap MBO as Founder Takes Out EPS


 Locoguide (4497 JP) / Kufu (4399 JP)

Real estate
0.4
Merger



Locoguide (4497 JP) - Kufu (4399 JP): Merger Is a Done Deal



Maruka Machinery (7594 JP) / Furusato Industries (8087 JP) 
Trading
0.4
Merger



A Complex SmallCap Merger in Japan: Maruka (7594) And Furusato (8087)



Secom Joshinetsu (4342 JP) 
Security
0.3
Tender Offer
66.2%


Secom To Finally Buy Out Affiliate Secom Joshinetsu (4342)








Malaysia




Can-One Bhd (CAN MK) 
Manufacturing
0.1
MTO
15.8%


Can-One (CAN MK)? Yeoh Can Lah!



IHH Healthcare (IHH MK) 
Healthcare
N/A
N/A
N/A


IHH Healthcare (IHH MK): More Medicine For Mitsui?


Source: Smartkarma Insights






The above does not include BetMakers Technology Group (BET AU) lobbing a non-binding offer of A$4bn (A$1bn cash, $3bn scrip into BET) for Tabcorp Ltd (TAH AU)'s wagering and media division, and Apollo's prior tilt - Tabcorp (TAH AU): Apollo Shows Its Hand.

Nor does the table include the rumoured merger between  Angang Steel Co Ltd (H) (347 HK) and Bengang Steel (000761 CH) - Amalgamated Steel: Merging Angang &amp; Bengang As, Bs, and Hs.



The average premium for the new deals announced (or first discussed) in May was ~41%, with a year-to-date average of ~31% (78 deals). This compares to the average premium for all deals in 2020 (158 deals) and 2019 (145 deals) of 31% and 31.5% respectively. 




Summary of News in May of Arb Situations On Smartkarma's Radar



(Again, click on the company names to take to you to the insights and/or discussion posts for a more comprehensive read-through on each situation)






Australia


Comments (with links to announcements &amp; insights)




3P Learning (3PL AU) 

No May update




Bingo Industries (BIN AU) 

1-May: Capital Group announced it has sold its entire 9.7% stake in Bingo Industries (BIN AU).




Crown Resorts (CWN AU) 

10-May: Crown Resorts: Blackstone &amp; Star Place Their Bets
17-May: Crown Says Blackstone's Bid Is Light. Undecided On Star
20-May: Crown Resorts Ltd: Blackstone Offer Rejected, Star Offer May Still Not Reflect True Forward Value




Galaxy Resources (GXY AU) 

No May update




Link Administration Holdings (LNK AU) 

27-May: Link Group (LNK AU): KKR Opens The Bidding For PEXA
31-May: Link Admin (LNK AU) Goes IPO Route For PEXA Afterall




Mainstream Group Holdings Ltd (MAI AU) 

2-May: Mainstream (MAI AU): More-Than-Double in Less than 2 Months After Apex Bump
6-May: Mainstream (MAI AU): Bidding War Continues as SS&amp;C Overbids for the 4th Time
14-May: Mainstream (MAI AU): +120% in ~2 Months but Bidding War Continues....




McPherson's Ltd (MCP AU) 

No May update




Mortgage Choice (MOC AU) 

26-Mau FIRB gives its approval



Primewest Group Ltd (PWG AU)

14-May: Target's Statement and Bidder's Statements were published. Primewest Group Ltd (PWG AU)'s Board has unanimously recommended shareholders to accept the Offer. 




Think Childcare (TNK AU) 

12-May: Think Childcare (TNK AU) has agreed to extend the Exclusivity Period with Busy Bees to 31st May 2021 (vs. original deadline of 14th May). This is still a non-binding deal with an expected completion date to be in 1Q CY22. 




Vitalharvest Freehold Trust (VTH AU) 

1-May: And so it goes - MAFM bumps its Offer for Vitalharvest Freehold Trust (VTH AU) to $1.26.
7-May: MAFM exercises a call option and acquires 16.2% of Vitalharvest Freehold Trust (VTH AU).
28-May Roc bumps its Offer for Vitalharvest Freehold Trust (VTH AU) to $1.29/share.  And says it will overbid any MAFM counter! 




Vocus Communications (VOC AU) 

10-May: Vocus Comms (VOC AU): MIRA/Aware's Done Deal
19-May: Vocus Comms (VOC AU): MIRA/​Aware’s Scheme Doc Despatched. EGM On 22 June










Hong Kong


Comments (with links to announcements &amp; insights)




Beijing Digital Telecom (6188 HK) 

1-May: Beijing Digital (6188 HK): Offer Now Open. IFA Says Fair
20-May: Beijing Digital Telecom (6188 HK)'s MGO is now unconditional in all respects. 




China Machinery Engineering (1829 HK) 

28-May: China Machinery Engineering (1829 HK): Movement In The Works?




China Traditional Chinese Medicine (570 HK) 

7-May: In its monthly update regarding a potential Offer, China Traditional Chinese Medicine (570 HK) says there is no update.




China Youzan Limited (8083 HK) 

10-May: China Youzan (8083 HK): Reality Check As Shares Rollover




Kerry Logistics Network (636 HK) 

4-May: Kerry Logistics Network (636 HK) will hold an EGM on the 26 May for shareholders to vote on the sale of the Hong Kong and Taiwan warehouse businesses to Kerry Holdings. 
26-May: At its SGM, Kerry Logistics Network (636 HK) shareholders overwhelmingly approved the sale of its Hong Kong, Taiwan warehouse business to Kerry Holdings.




New Century REIT (1275 HK) 

No May update




Rivera Holdings (281 HK) 

No April update




Sichuan Languang Justbon Service Group (2606 HK) 

3-May: Languang Justbon (2606 HK): Offer Now Open - For Up To Four Months










India


Comments (with links to insights)




Mphasis Ltd (MPHL IN) 

4-May: The Detailed Public Statement on Mphasis Ltd (MPHL IN) has been released. The Open Offer is scheduled tentatively to run from 18 June to 1 July, which means it is running Very Tight and the option is worth a bit less than I expected. But that just means there is more gamma. One could get big at the high Rs 1600s area. 




Vedanta Ltd (VEDL IN) 

4-May: Vedanta Now Caught Up With Peers - A Different Skew Ahead










Japan


Comments (with links to announcements &amp; insights)




BeNEXT Group (2154 JP) 
No May update



Cocokara Fine (3098 JP) 
No May update



Fuji Kosan Company (5009 JP) 
17-May:  Fuji Kosan Company (5009 JP) has responded to Aslead Strategic Value Fund's Tender Offer with its initial Target Opinion Statement which is "Opinion Withheld." This is because Fuji Kosan hasn't actually done anything yet - two weeks in. They have sent questions to Aslead, and Aslead has five business days to respond. This is slow-walking it. This tender offer is likely to be extended because of that.



Hitachi Metals (5486 JP) 

5-May: Hitachi Metals - Should I Stay or Should I Go Now?




Honshu Chemical Industry (4115 JP) 

13-May: Honshu Chemical (4115) Shareholders Perhaps One Day From a Wrong Price Takeover
16-May:: Honshu Chemical Shareholders Get the Short End of the Stick As The Board Is Ex-Gourd




Invesco Office J Reit (3298 JP) 

6-May:  Invesco Office OPPOSES Starwood Hostile Offer and Gets a Distinctly Beige Knight
11-May:  Starwood Bumps Terms, Lowers Threshold on Invesco Office
13-May:  Invesco Office's Terrible, Horrible, No Good Very Bad Day... Changes Things
20-May:  Invesco Office's Beige Knight (Deemed Dirty Gray By Markets) Suddenly Looks Brighter and Whiter
23-May:  Starwood Responds to Invesco Office's White Knight Proposal
24-May: Starwood has extended their Tender Offer on Invesco Office J Reit (3298 JP) from the 24th of May to 15th of June after the close of the 24th. They did not raise the price. This is basically the equivalent of Starwood calling Invesco's bluff. They can extend again if they want but they are going to make Invesco come out. They can change price later if they think it necessary.



Japan Asia (3751 JP)
No May update



Sawada Holdings (8699 JP) 

9-May:  Sawada Selldown Was NOT Done - Shareholder Structure Looks Different Now
23-May: Sawada Is A Different Stock Now
31-May:  Be Careful of Expectations on Sawada (8699)




Toshiba Corp (6502 JP) 

14-May: Toshiba – Shareholder Returns Trump Weak Guidance
17-May: Toshiba Results &amp; Shareholder Return - Possibly Big Impact Buyback Coming











New Zealand


Comments 




Tilt Renewables Ltd (TLT NZ) 

No May update











Singapore


Comments (with links to announcements)




Procurri Corporation (PROC SP) 

3-May: The Partial Offer has not become unconditional in all respects on the Closing Date and has therefore lapsed










Thailand


Comments




Intouch Holdings (INTUCH TB) 

No May update




Vinythai Public Co (VNT TB) 

No May update






Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

<div>
<p>On 16 November 2020, Australia-based Childcare company <a href="https://www.smartkarma.com/entities/think-childcare-ltd" target="_blank" data-smartkarma-citation="entities:18899:1" rel="noopener">Think Childcare (TNK AU)</a> received a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02308970-3A555430?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Non-binding Indicative Proposal</a> at an Offer Price of A$1.35/share from the PE arm of <a href="https://www.alceon.com.au/" target="_blank" rel="noopener">Alceon Group</a> which is an Australian independent multi-strategy alternative investments firm.</p>
</div>
<div>
<p>A week later, on 23rd Nov 2020, TNK received a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02311977-3A556064?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">competing bid</a> at an Offer Price of A$1.75/share from Busy Bees Early Learning Australia Pty Ltd which is the Australian arm of multinational child care firm Busy Bees Nursery Group which is backed by Ontario Teachers’ Pension Plan (OTPP) and Temasek. I discussed this competitive situation in <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-competitive-bid-by-busy-bees" target="_blank" data-smartkarma-citation="insights:45609" rel="noopener">Think Childcare (TNK AU): Competitive Bid by Busy Bees</a> pointing out the implications of Alceon's matching right and since TNK's share price of A$1.60 translated to a very attractive spread given the high likelihood of a further overbid, I was Bullish on the stock.</p>
</div>
<div>
<blockquote>
<p>I expect TNK shareholders to receive at least A$1.75/share at the end of this competitive situation and I also expect TNK to trade much closer to terms once there is more clarity on Alceon's stance in the next 5 days. (<a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-competitive-bid-by-busy-bees" target="_blank" rel="noopener">written 23 Nov 2020</a>)</p>
</blockquote>
</div>
<div>
<p>Although initially Alceon let their matching right lapse, a month later, on 24th December 2020, they launched a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02326507-3A558868?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">revised non-binding and indicative proposal</a> matching that of Busy Bees' non-binding bid (A$1.75/share) and also announced they had acquired a relevant interest of 19.23% in TNK. Roughly a month later, Busy Bees <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02332137-3A559736?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">revised their competitive bid</a> to A$2.10/share -  a 20% bump from the previous bid level. I discussed this situation again in <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-bigger-bid-by-busy-bees" target="_blank" data-smartkarma-citation="insights:47224" rel="noopener">Think Childcare (TNK AU): Bigger Bid by Busy Bees</a> reiterating my bullish stance on the stock. </p>
</div>
<div>
<blockquote>
<p> I expect TNK shareholders to receive at least A$2.10/share at the end of this competitive situation. (<a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-bigger-bid-by-busy-bees" target="_blank" rel="noopener">written 20 Jan 2021</a>)</p>
</blockquote>
<p>However on 4th March 2021, as the Shares were trading through Terms at A$2.23, considering the deal break risk, I suggested in <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-trading-through-terms-should-you-fold-now" target="_blank" data-smartkarma-citation="insights:48817" rel="noopener">Think Childcare (TNK AU): Trading Through Terms. Should You Fold Now?</a> that it might be time to exit.  </p>
<p><strong>Turns out I was wrong this time. Earlier Today, Busy Bees <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02360625-3A564793?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">launched a revised bid at A$3.20</a>. More below the fold. </strong></p>
<hr>
<div>
<div>
<div class="content-remarks">
<p>For more information about M&amp;A rules, regulations, and practices in Australia, please refer to <a href="https://www.smartkarma.com/insights/quiddity-australia-m-a-guide-2019" target="_blank" data-smartkarma-citation="insights:30118" rel="noopener">Quiddity Australia M&amp;A Guide 2019</a> and <a href="https://www.smartkarma.com/insights/quiddity-m-a-australia-foreign-investment-reforms" target="_blank" data-smartkarma-citation="insights:40210" rel="noopener">Quiddity M&amp;A: Australia Foreign Investment Reforms</a> </p>
</div>
</div>
</div>
</div>


On 16 November 2020, Australia-based Childcare company Think Childcare (TNK AU) received a Non-binding Indicative Proposal at an Offer Price of A$1.35/share from the PE arm of Alceon Group which is an Australian independent multi-strategy alternative investments firm.


A week later, on 23rd Nov 2020, TNK received a competing bid at an Offer Price of A$1.75/share from Busy Bees Early Learning Australia Pty Ltd which is the Australian arm of multinational child care firm Busy Bees Nursery Group which is backed by Ontario Teachers’ Pension Plan (OTPP) and Temasek. I discussed this competitive situation in Think Childcare (TNK AU): Competitive Bid by Busy Bees pointing out the implications of Alceon's matching right and since TNK's share price of A$1.60 translated to a very attractive spread given the high likelihood of a further overbid, I was Bullish on the stock.



I expect TNK shareholders to receive at least A$1.75/share at the end of this competitive situation and I also expect TNK to trade much closer to terms once there is more clarity on Alceon's stance in the next 5 days. (written 23 Nov 2020)



Although initially Alceon let their matching right lapse, a month later, on 24th December 2020, they launched a revised non-binding and indicative proposal matching that of Busy Bees' non-binding bid (A$1.75/share) and also announced they had acquired a relevant interest of 19.23% in TNK. Roughly a month later, Busy Bees revised their competitive bid to A$2.10/share -  a 20% bump from the previous bid level. I discussed this situation again in Think Childcare (TNK AU): Bigger Bid by Busy Bees reiterating my bullish stance on the stock. 



 I expect TNK shareholders to receive at least A$2.10/share at the end of this competitive situation. (written 20 Jan 2021)

However on 4th March 2021, as the Shares were trading through Terms at A$2.23, considering the deal break risk, I suggested in Think Childcare (TNK AU): Trading Through Terms. Should You Fold Now? that it might be time to exit.  
Turns out I was wrong this time. Earlier Today, Busy Bees launched a revised bid at A$3.20. More below the fold. 




For more information about M&amp;A rules, regulations, and practices in Australia, please refer to Quiddity Australia M&amp;A Guide 2019 and Quiddity M&amp;A: Australia Foreign Investment Reforms 





Think Childcare (TNK AU): Busy Bees Delivers a Knock-Out Bid

Last Week in Event SPACE: China Youzan, Mcdonald's, Beijing Jingneng, Ricoh, Melco Resorts, LG Corp

<p>On 16 November 2020, Australia-based Childcare company <a href="https://www.smartkarma.com/entities/think-childcare-ltd" target="_blank" data-smartkarma-citation="entities:18899:1" rel="noopener">Think Childcare (TNK AU)</a> received a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02308970-3A555430?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Non-binding Indicative Proposal</a> at an Offer Price of A$1.35/share from the PE arm of <a href="https://www.alceon.com.au/" target="_blank" rel="noopener">Alceon Group</a> which is an Australian independent multi-strategy alternative investments firm.</p><p>A week later, on 23rd Nov 2020, TNK received a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02311977-3A556064?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">competitive bid</a> at an Offer Price of A$1.75/share from Busy Bees Early Learning Australia Pty Ltd which is the Australian arm of multinational child care firm Busy Bees Nursery Group which is backed by Ontario Teachers’ Pension Plan (OTPP) and Temasek. I discussed this competitive situation in <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-competitive-bid-by-busy-bees" target="_blank" data-smartkarma-citation="insights:45609" rel="noopener">Think Childcare (TNK AU): Competitive Bid by Busy Bees</a> pointing out the implications of Alceon's matching right and since TNK's share price of A$1.60 translated to a very attractive spread given the high likelihood of a further overbid, I was Bullish on the stock.</p><blockquote><p>I expect TNK shareholders to receive <strong>at least A$1.75/share</strong> at the end of this competitive situation and I also expect TNK to trade much closer to terms once there is more clarity on Alceon's stance in the next 5 days. (<strong><a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-competitive-bid-by-busy-bees" target="_blank" rel="noopener">written 23 Nov 2020</a></strong>)</p></blockquote><p>Although initially Alceon let their matching right lapse, a month later, on 24th December 2020, they launched a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02326507-3A558868?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">revised non-binding and indicative proposal</a> matching that of Busy Bees' non-binding bid (A$1.75/share) and also announced they had acquired a relevant interest of 19.23% in TNK. Roughly a month later, Busy Bees <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02332137-3A559736?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">revised their competitive bid</a> to A$2.10/share -  a 20% bump from the previous bid level. I discussed this situation again in <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-bigger-bid-by-busy-bees" target="_blank" data-smartkarma-citation="insights:47224" rel="noopener">Think Childcare (TNK AU): Bigger Bid by Busy Bees</a> reiterating my bullish stance on the stock. </p><blockquote><p> I expect TNK shareholders to receive <strong>at least A$2.10/share</strong> at the end of this competitive situation. (<strong><a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-bigger-bid-by-busy-bees" target="_blank" rel="noopener">written 20 Jan 2021</a></strong>)</p></blockquote><p>Now <a href="https://www.smartkarma.com/entities/think-childcare-ltd" target="_blank" data-smartkarma-citation="entities:18899:1" rel="noopener">Think Childcare (TNK AU)</a> shares are at <strong>A$2.23</strong>. </p><p>The current price translates to a +39% gain for those who bought TNK shares at A$1.60 roughly 3.5 months ago. Below is a discussion on how the risk-return characteristics of this trade have evolved over the last few months and whether that presents a reason to reverse our bullish stance on the situation. </p>

On 16 November 2020, Australia-based Childcare company Think Childcare (TNK AU) received a Non-binding Indicative Proposal at an Offer Price of A$1.35/share from the PE arm of Alceon Group which is an Australian independent multi-strategy alternative investments firm.A week later, on 23rd Nov 2020, TNK received a competitive bid at an Offer Price of A$1.75/share from Busy Bees Early Learning Australia Pty Ltd which is the Australian arm of multinational child care firm Busy Bees Nursery Group which is backed by Ontario Teachers’ Pension Plan (OTPP) and Temasek. I discussed this competitive situation in Think Childcare (TNK AU): Competitive Bid by Busy Bees pointing out the implications of Alceon's matching right and since TNK's share price of A$1.60 translated to a very attractive spread given the high likelihood of a further overbid, I was Bullish on the stock.I expect TNK shareholders to receive at least A$1.75/share at the end of this competitive situation and I also expect TNK to trade much closer to terms once there is more clarity on Alceon's stance in the next 5 days. (written 23 Nov 2020)Although initially Alceon let their matching right lapse, a month later, on 24th December 2020, they launched a revised non-binding and indicative proposal matching that of Busy Bees' non-binding bid (A$1.75/share) and also announced they had acquired a relevant interest of 19.23% in TNK. Roughly a month later, Busy Bees revised their competitive bid to A$2.10/share -  a 20% bump from the previous bid level. I discussed this situation again in Think Childcare (TNK AU): Bigger Bid by Busy Bees reiterating my bullish stance on the stock.  I expect TNK shareholders to receive at least A$2.10/share at the end of this competitive situation. (written 20 Jan 2021)Now Think Childcare (TNK AU) shares are at A$2.23. The current price translates to a +39% gain for those who bought TNK shares at A$1.60 roughly 3.5 months ago. Below is a discussion on how the risk-return characteristics of this trade have evolved over the last few months and whether that presents a reason to reverse our bullish stance on the situation. 

Think Childcare (TNK AU): Trading Through Terms. Should You Fold Now?

<p>On 16 November 2020, Australia-based Childcare company <a href="https://www.smartkarma.com/entities/think-childcare-ltd" target="_blank" data-smartkarma-citation="entities:18899:1" rel="noopener">Think Childcare (TNK AU)</a> received a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02308970-3A555430?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Non-binding Indicative Proposal</a> at an Offer Price of A$1.35/share from the PE arm of <a href="https://www.alceon.com.au/" target="_blank" rel="noopener">Alceon Group</a> which is an Australian independent multi-strategy alternative investments firm. </p><p>In my insight <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-takeover-proposal-from-alceon-group-seems-light" target="_blank" data-smartkarma-citation="insights:45429" rel="noopener">Think Childcare (TNK AU) : Takeover Proposal From Alceon Group Seems Light</a>, I concluded that this Offer Price of A$1.35 seemed light on a growth-adjusted basis and when compared against the valuations of other local and global peers.  I mentioned the possibility of bumpitrage but low liquidity made it iffy and I was not bullish on the trade.</p><p>A week later, on 23rd Nov 2020, TNK received a <em><strong><a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02311977-3A556064?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">competitive bid</a></strong></em> at an Offer Price of A$1.75/share from Busy Bees Early Learning Australia Pty Ltd which is the Australian arm of multinational child care firm Busy Bees Nursery Group which is backed by Ontario Teachers’ Pension Plan (OTPP) and Temasek.</p><p><em>I got bullish</em> and discussed this competitive situation in <a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-competitive-bid-by-busy-bees" target="_blank" data-smartkarma-citation="insights:45609" rel="noopener">Think Childcare (TNK AU): Competitive Bid by Busy Bees</a> pointing out the implications of Alceon's matching right and since TNK's share price of A$1.60 translated to a <em>very</em> attractive spread given the high likelihood of a further overbid, I was Bullish on the stock.</p><blockquote><p><strong>THE TRADE: I would be LONG now.</strong> I expect TNK shareholders to receive at least A$1.75/share at the end of this competitive situation and I also expect TNK to trade much closer to terms once there is more clarity on Alceon's stance in the next 5 days. <strong>(<a href="https://www.smartkarma.com/insights/think-childcare-tnk-au-competitive-bid-by-busy-bees" target="_blank" rel="noopener">written 23 Nov 2020</a>)</strong></p></blockquote><p>Although initially Alceon let their matching right lapse, a month later, on 24th December 2020, they launched a <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02326507-3A558868?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">revised non-binding and indicative proposal</a> matching that of Busy Bees' non-binding bid (A$1.75/share) and also announced they had acquired a relevant interest of 19.23% in TNK.  </p><p>Today, Busy Bees <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02332137-3A559736?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">revised their competitive bid</a> to A$2.10/share -  a 20% bump from the previous bid level. </p><p>TNK shares last closed at A$2.00. </p><div><p><em>More below the fold. </em></p></div><hr><div><div><div class="content-remarks"><p>For more information about M&amp;A rules, regulations, and practices in Australia, please refer to <a href="https://www.smartkarma.com/insights/quiddity-australia-m-a-guide-2019" target="_blank" data-smartkarma-citation="insights:30118" rel="noopener">Quiddity Australia M&amp;A Guide 2019</a> and <a href="https://www.smartkarma.com/insights/quiddity-m-a-australia-foreign-investment-reforms" target="_blank" data-smartkarma-citation="insights:40210" rel="noopener">Quiddity M&amp;A: Australia Foreign Investment Reforms</a> </p></div></div></div>

On 16 November 2020, Australia-based Childcare company Think Childcare (TNK AU) received a Non-binding Indicative Proposal at an Offer Price of A$1.35/share from the PE arm of Alceon Group which is an Australian independent multi-strategy alternative investments firm. In my insight Think Childcare (TNK AU) : Takeover Proposal From Alceon Group Seems Light, I concluded that this Offer Price of A$1.35 seemed light on a growth-adjusted basis and when compared against the valuations of other local and global peers.  I mentioned the possibility of bumpitrage but low liquidity made it iffy and I was not bullish on the trade.A week later, on 23rd Nov 2020, TNK received a competitive bid at an Offer Price of A$1.75/share from Busy Bees Early Learning Australia Pty Ltd which is the Australian arm of multinational child care firm Busy Bees Nursery Group which is backed by Ontario Teachers’ Pension Plan (OTPP) and Temasek.I got bullish and discussed this competitive situation in Think Childcare (TNK AU): Competitive Bid by Busy Bees pointing out the implications of Alceon's matching right and since TNK's share price of A$1.60 translated to a very attractive spread given the high likelihood of a further overbid, I was Bullish on the stock.THE TRADE: I would be LONG now. I expect TNK shareholders to receive at least A$1.75/share at the end of this competitive situation and I also expect TNK to trade much closer to terms once there is more clarity on Alceon's stance in the next 5 days. (written 23 Nov 2020)Although initially Alceon let their matching right lapse, a month later, on 24th December 2020, they launched a revised non-binding and indicative proposal matching that of Busy Bees' non-binding bid (A$1.75/share) and also announced they had acquired a relevant interest of 19.23% in TNK.  Today, Busy Bees revised their competitive bid to A$2.10/share -  a 20% bump from the previous bid level. TNK shares last closed at A$2.00. More below the fold. For more information about M&amp;A rules, regulations, and practices in Australia, please refer to Quiddity Australia M&amp;A Guide 2019 and Quiddity M&amp;A: Australia Foreign Investment Reforms 

Think Childcare (TNK AU): Bigger Bid by Busy Bees

Australia

Think Childcare Limited owns, manages, and operates long day childcare facilities. The Company offers child development and education services. Think Childcare serves customers in Australia.

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Think Childcare (TNK AU)

(Mostly) Asia M&A: May 2021 Roundup

The average premium for the new deals announced (or first discussed) in May was ~41%, with a year-to-date average of ~31% (78 deals).

David Blennerhassett