In today’s briefing:
- Big Aisin (7259) Offering Sets Stage for First Toyota Group Full Unwind
- Aisin Corp Placement – US$1.1bn Selldown by Toyota and DENSO
- Aisin (7259 JP): A US$1.1 Billion Secondary Offering
- LG Electronics’ Indian Subsidiary Is Gearing up for an IPO on the Indian Stock Market
- Timee Pre-IPO – The Negatives – Competition Could Stiffen
- Initial Thoughts on LG Electronics India IPO
- Webtoon Entertainment IPO Trading – Not Cheap Given the Lack of Growth
- Cirrus Aircraft Pre-IPO – Refiled PHIP Updates – Customer Demand Remains Strong
Big Aisin (7259) Offering Sets Stage for First Toyota Group Full Unwind
- Today (27 June 2024) after the close, Aisin (7259 JP) announced three Toyota Group companies (Toyota, Toyota Industries, and Denso) would sell shares in Aisin in a ¥180bn offering.
- This is ALL of Denso’s holdings, 63% of Toyota Industries stake, and ~12% of Toyota’s stake. Separately, Aisin announced a 17mm share (6.3%) ¥100bn buyback and a 3:1 split Oct1.
- The recent yuho shows us the progress of Aisin’s promised selldown of crossholdings. There are three large chunks left. One is easy. The climb to capital allocation credibility easier too.
Aisin Corp Placement – US$1.1bn Selldown by Toyota and DENSO
- Denso Corp (6902 JP), Toyota Motor (7203 JP) and Toyota Industries (6201 JP) are looking to raise US$1.1bn from selling some of their stakes in Aisin (7259 JP).
- While the deal appears well-flagged, given that it is part of the cross-shareholding unwind theme in Japan, the timing of such a selldown isn’t always certain.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Aisin (7259 JP): A US$1.1 Billion Secondary Offering
- Aisin (7259 JP) has announced a secondary offering of up to 38.9 million shares (including overallotment) and a buyback worth a maximum of JPY100 billion or 17 million shares.
- Denso Corp (6902 JP), Toyota Industries (6201 JP), and Toyota Motor (7203 JP) are the selling shareholders. The offering aims to reconfigure the company’s shareholder mix and reduce cross-shareholdings.
- Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will fall between 8 and 10 July (likely 8 July).
LG Electronics’ Indian Subsidiary Is Gearing up for an IPO on the Indian Stock Market
- LG Electronics’ Indian subsidiary, fully owned, saw 2023 sales grow 17% to ₩3.3T and net profit rise 14% to ₩231.3B, driven by strong appliance demand.
- LG Electronics aims for a ₩5T-₩6T valuation, planning to sell 15-20% of their Indian subsidiary to raise at least $500M.
- LG Electronics plans to invest the $500M raised into their EV components business, moving quickly with the IPO due to urgent funding needs in the downturn-hit sector.
Timee Pre-IPO – The Negatives – Competition Could Stiffen
- Timee Inc (215A JP) is looking to raise US$290m from its Japan IPO. The IPO will be a 100% secondary selldown by existing shareholders.
- Timee operates an on-demand staffing platform that connects part-time jobseekers with businesses in Japan.
- In this note, we will talk about the not so positive aspects of the deal.
Initial Thoughts on LG Electronics India IPO
- According to local media, LG Electronics is reviewing for a potential IPO of LG Electronics India. LG Electronics has approached JP Morgan and Morgan Stanley to be potential IPO underwriters.
- If LG Electronics’ Indian subsidiary is listed, it is expected to be able to raise at least $500 million from the stock market.
- Post IPO, the market value of LG Electronics India is estimated to be between $2.1 billion (3 trillion won) and $4.3 billion (6 trillion won).
Webtoon Entertainment IPO Trading – Not Cheap Given the Lack of Growth
- Webtoon Entertainment (WBTN US) raised around US$315m in its US IPO, after pricing the deal at the top of the range at US$21/share.
- Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content.
- In our previous notes, we talked about the company’s historical performance, undertook a peer comparison and shared our thoughts on valuation. In this note, we talk about the trading dynamics.
Cirrus Aircraft Pre-IPO – Refiled PHIP Updates – Customer Demand Remains Strong
- Cirrus Aircraft (0153126D US) seeks to raise up to US$100m in its upcoming HK IPO, after downsizing from an earlier reported float of US$200m.
- Cirrus Aircraft designs, develops, manufactures, and sells premium aircrafts. Its two aircraft product lines, the SR2X Series and the Vision Jet, are currently certified and validated in over 60 countries.
- We had covered the company’s performance and PHIP updates in our earlier notes. In this note, we talk about its refiled PHIP updates.
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