In today’s briefing:
- AAG Energy (2686 HK): Xinjiang Xintai’s Light but Final HK$1.85 Offer
- Index Rebalance & ETF Flow Recap: S&P/ASX, KOSPI, NIFTYJR, Kakao Pay, HK Electric, Adani Group
- AAG Energy (2686 HK): Xinjiang Xintai ‘s Underwhelming Scheme Offer
- EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
AAG Energy (2686 HK): Xinjiang Xintai’s Light but Final HK$1.85 Offer
- Aag Energy Holdings (2686 HK) disclosed a pre-conditional privatisation offer from Xinjiang Xintai Natural Gas (603393 CH) at HK$1.85 per share, a 10.1% premium to the undisturbed price.
- The pre-condition is Xinjiang Xintai shareholder approval. Key condition is approval by at least 75% of disinterested shareholders (<10% of all disinterested shareholders rejection). The price is final but light.
- The total privatisation cost is HK$2,704 million vs AAG’s net cash of HK$2,270 million. The offeror is betting that minorities will not be able to launch a concerted NO vote.
Index Rebalance & ETF Flow Recap: S&P/ASX, KOSPI, NIFTYJR, Kakao Pay, HK Electric, Adani Group
- The announcement of the changes to the FTSE GEIS was made on Friday post market close. Friday was also the cutoff for the March review of the S&P/ASX indices.
- Monday is the review cutoff for some indices, while Friday is the announcement of the changes to the Hang Seng family of indices and the SSE STAR50 (STAR50 INDEX).
- There were big outflows from the IShares Edge MSCI Min Vol Emerging Markets ETF (EEMV US) for yet another week taking YTD outflows to nearly US$3bn.
AAG Energy (2686 HK): Xinjiang Xintai ‘s Underwhelming Scheme Offer
- 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.
EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
- Weekly summary of vol changes and moves across Global Markets
- Analysing ATM volatility and skew changes over the last 5 days
- We suggest a few trades to take advantage of the implied vol surfaces
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