In today’s briefing:
- 7&I (3382 JP) – A York Holdings Deal And Warren Buffett?
- Vitasoy (345 HK): Trading Rich As Ng & Yeo Hiap Seng Up Their Exposure
- Seven & I Holdings (3382 JP): Implications from the YORK Holdings Stake Sale
- Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: Last-Second Changes to the Last-Minute Changes
- Shandong Hi-Speed New Energy (1250 HK): Shandong Hi-Speed Holdings (412 HK) Possible MGO
- Digging into the Year-End Divvy Arbitrage Game in Korea’s Market
- Fosun Tourism (1992 HK): Back Into The Fold?
- Shandong Hi-Speed New Energy (1250 HK): Possible MGO At HK$1.78/Share.
- Hulic Co (3003 JP) Placement: One Big Price Drop Could Lead to Another
- Vitasoy (345 HK): Take Profits as Takeover Speculation Mounts
7&I (3382 JP) – A York Holdings Deal And Warren Buffett?
- The Seven & I Holdings (3382 JP) to rid itself of control of the Ito-Yokado, York Benimaru, Akachan Hompo, and Denny’s Japan businesses in York Holdings proceeds apace.
- The First Round of bids is due tomorrow, apparently, and all manner of bidders have assembled.
- This leads to the question of a deal for the rest of 7&i. If a TradingCo is a natural co-investor for the Ito family (or ACT), so is Berkshire Hathaway.
Vitasoy (345 HK): Trading Rich As Ng & Yeo Hiap Seng Up Their Exposure
- Yesterday, beverage maker Vitasoy Intl Holdings (345 HK) announced a 1H25E (Mar Y/E) net profit of HK$171mn, a 4.8% gain yoy. An interim dividend of HK$0.04/share (HK$0.014/share in 1H24), was declared.
- What was absent from the announcement/briefing was any comment on Philip Ng Chee-tat’s and Yeo Hiap Seng (YHS SP)‘s recent buying in Vitasoy.
- Ng, the younger brother of Sino Land (83 HK)‘s chairman Robert Ng Chee-siong, indirectly holds 12.26%, up from 5.22% on the 7th October. The share price is up 104% since.
Seven & I Holdings (3382 JP): Implications from the YORK Holdings Stake Sale
- NHK reports that Seven & I Holdings (3382 JP)‘s first bidding round for a YORK Holdings stake ends on 28 November. The sale provides a third-party valuation benchmark for the asset.
- It is an incremental positive for the founding family MBO as it supports the post-privatisation strategy and assists in securing bank financing.
- This is an incremental negative for Alimentation Couche-Tard (ATD CN) as it shows that the Board believes the restructuring plan will increase shareholder corporate value.
Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: Last-Second Changes to the Last-Minute Changes
- There are now new changes forecast for the Yuanta/P-Shares Taiwan Dividend Plus ETF in December for a total of 8 inclusions and 7 deletions.
- Constituent changes along with capping changes will lead to a one-way turnover of 21.8% and in a one-way trade of TWD 75.8bn (US$2.33bn).
- The potential changes had a big one-day move yesterday and we expect similar moves over the next couple of days.
Shandong Hi-Speed New Energy (1250 HK): Shandong Hi-Speed Holdings (412 HK) Possible MGO
- Shandong Hi-Speed New Energy G (1250 HK) disclosed a possible mandatory unconditional offer from Shandong Hi-Speed Holdings Gro (412 HK) at HK$1.78, a 7.2% premium to the undisturbed price.
- The offer is conditional on SDHS completing a sale and purchase agreement (SPA) to acquire CITIC Securities’ entire 13.52% stake at HK$1.78 per share.
- The key precondition of the SPA is SDHS shareholder approval of an ordinary resolution relating to the SPA and the possible offer. The vote is a formality.
Digging into the Year-End Divvy Arbitrage Game in Korea’s Market
- For March KOSPI 200 futures, expect a 0.95% to 1% yield for spot-futures arbitrage, with contango depending on year-end ex-div trends and passive inflows.
- Passive inflows into the value-up index in January and spillover effects into K200 futures, potentially fueling year-end contango due to overlap with KOSPI 200.
- Prop trader dynamics are cooling off: Tax-driven buying in December, selling in January likely to ease, reducing the past backwardation. Without it, expect higher volatility in K200 futures.
Fosun Tourism (1992 HK): Back Into The Fold?
- Fosun Tourism (1992 HK) a leisure-focused integrated tourism group, is currently suspended pursuant to the Takeovers Code.
- Fosun Tourism was spun off from Fosun International (656 HK) in December 2018. Fosun Int’l currently holds 79.45% of shares out.
- Fosun Tourism gained ~8% yesterday on the highest volume in over two years. Recent news concerned Temasek-backed CapitaLand Investment (CLI SP) taking a 20-30% stake in Fosun Tourism’s subsidiary Club Med.
Shandong Hi-Speed New Energy (1250 HK): Possible MGO At HK$1.78/Share.
- Not a delisting Offer, but a possible mandatory unconditional Offer from Shandong Hi-Speed Holdings (412 HK) (SDHG) at HK$1.78/share, a premium of 7.23% to last close.
- SDHG, with 43.45%, has entered into an SPA with two Citic Securities (H) (6030 HK)-backed funds holding 13.52%, the completion of which lifts SDHG’s take to 56.97%, triggering an MGO.
- Conditions to the SPA are straightforward. Expect Shandong Hi-Speed New Energy G (1250 HK) to trade tight, if not through terms.
Hulic Co (3003 JP) Placement: One Big Price Drop Could Lead to Another
- Overnight, Hulic Co Ltd (3003 JP) announced a placement of 85.37m shares to unwind crossholdings and improve corporate value. There is an overallotment option for another 12.8m shares.
- There will be limited passive buying in the short-term and the number of shares offered is a very large percentage of real float of the stock.
- A price drop of 20% or more puts Hulic Co Ltd (3003 JP) at risk of deletion from a global index and could lead to a further price drop.
Vitasoy (345 HK): Take Profits as Takeover Speculation Mounts
- Vitasoy Intl Holdings (345 HK)’s shares surged 19.5% on speculation that billionaire Philip Ng will launch a takeover offer due to recent share purchases.
- Philip Ng’s stakebuilding suggests three potential outcomes. The likely near-term outcome is that he continues to nudge up his stake and potentially seek Board representation.
- Without the Lo family’s support, a scheme privatisation is impossible. While a voluntary conditional offer is possible, it isn’t very likely, as Vitasoy’s valuation looked frothy at the last close.
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