In today’s briefing:
- Arbs Take Another Hit as Regal’s Offer for Perpetual Puts Pendal Deal at Risk
- EQT/Baring/Regal’s Tilt For Perpetual Muddies Waters on Pendal (PDL AU) Deal
- News Corp (NWS AU)’s Proposed Merger With Fox Corp. Again.
- FTSE China 50 Index Rebalance Preview: Two Changes Now, Could Be More
- Perpetual Turns from Predator to Prey with Regal/BPEA EQT’s Offer
- Singapore Medical: TTW Bumps To S$0.40
- Launching Single-Stock ETFs in Korea: Market Flow Impact Analysis
Arbs Take Another Hit as Regal’s Offer for Perpetual Puts Pendal Deal at Risk
- Regal Partners and BPEA have made a conditional, non-binding indicative proposal to acquire Perpetual Ltd at A$30/share in cash. Perpetual would need to terminate the SID with Pendal Group.
- Perpetual Ltd (PPT AU)‘s Board has rejected the offer. Today’s price action is partially driven by arbs selling Pendal shares and buying back their Perpetual shorts.
- The Pendal Group / Perpetual Ltd price ratio is trading below the levels from August and could move higher if Perpetual and/or the consortium decide not to move ahead.
EQT/Baring/Regal’s Tilt For Perpetual Muddies Waters on Pendal (PDL AU) Deal
- Perpetual (PPT AU) has received an indicative proposal in which EQT/Baring Private Equity Asia takes Perpetual’s private clients and corporate trustee businesses, and Regal (RPL AU) the asset management arm.
- The A$1.75bn buyout proposal, by way of a $30/share cash Offer – and an undefined Regal scrip alternative – was rejected by Perpetual as it “materially undervalues” the company.
- The twist in the proposal is that it is contingent on the termination of the earlier-announced Scheme between Perpetual and Pendal Group (PDL AU)
News Corp (NWS AU)’s Proposed Merger With Fox Corp. Again.
- Back on the 17 October, News Corp (NWS AU) announced it had begun exploring a potential combination with Fox Corporation (FOXA US).
- A merger of two parts of Rupert Murdoch’s media empire would combine Fox News and TMZ assets with NWS’ newspaper and online news operations.
- Murdoch split his empire in 2013, placing the print business in a newly created NWS, and the TV and entertainment under Fox,
FTSE China 50 Index Rebalance Preview: Two Changes Now, Could Be More
- Tianqi Lithium (9696 HK) and JD Health (6618 HK) could be inclusions while XPeng (9868 HK) and Longfor Properties (960 HK) are near certain deletions.
- There are a few stocks that are close to the deletion threshold and could be deleted from the index if they continue to sell off over the next few weeks.
- Tianqi Lithium (9696 HK) is also a high probability inclusion to the FTSE All-World Index at the December rebalance. That will bring in additional inflows to the stock.
Perpetual Turns from Predator to Prey with Regal/BPEA EQT’s Offer
- Perpetual Ltd (PPT AU) rejected a conditional, non-binding indicative proposal from Regal Partners (RPL AU)/BPEA EQT at A$30.00 per share, an 11.5% premium to the undisturbed price.
- Regal/BPEA EQT’s aim is to present shareholders with a choice – pay a premium to merge with Pendal Group (PDL AU) or receive a lower risk premium from Regal/BPEA EQT.
- The Perpetual/Pendal deal is increasingly on shaky grounds. The skinny premium suggests that Regal/BPEA EQT have headroom to bump the offer to get the Board to engage.
Singapore Medical: TTW Bumps To S$0.40
- I should have stuck to my guns. Singapore Medical (SMG SP)‘s original Exit Offer was low-balled. The IFA all but conceded this. I mused that TTW probably needed to bump.
- And now TTW has, bumping the Offer by 8.1% to S$0.40/share, and declaring the terms final.
- The Offer remains subject to TTW holding 90% (with 77.42% in the bag already). The Offer has been extended to the 5 December.
Launching Single-Stock ETFs in Korea: Market Flow Impact Analysis
- The target market size that will be affected by the Default Option is estimated to be ₩92T. Up to 30% of them (₩30T) can flow into single-stock ETFs.
- Competing against TDFs, half of this ₩30T is a conservative estimate for single-stock ETFs. Then, up to 40% of the ₩15T becomes the flow size entering the local stock market.
- KODEX’s Samsung Electronics single-stock ETF may dominate the market. In this case, at least ₩3-4T can flow into Samsung Electronics Ord.
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