In today’s briefing:
- EOFlow/Medtronic: What Lawsuit?
- Korea – Positioning in Ecopro, JYP Entertainment, Hanwha Ocean, Hanmi Semi, CJ Corp, E-Mart
- Golden Eagle Retail (3308 HK): Scheme Vote on 15 September
- M&A Research Institute Holdings (9552) TOPIX Inclusion
- EOFLOW/Medtronic Tender: Irrational Exuberance
- Quiddity Leaderboard F100/250 Sep 23: Several Changes Including Potential Surprises
EOFlow/Medtronic: What Lawsuit?
- On the 8th of August, Insulet Corp (PODD US) filed a lawsuit accusing Eoflow (294090 KS) of the misappropriation of trade secrets, patent infringement, and trademark dilution.
- The filing was pretty heavy on accusations. EOFlow declined ~11% on the news.
- Undeterred, Medtronic (MDT US) continues to preach all is peachy, suggesting the EOFlow merger is a go, and Medtronic will deal with the lawsuit, as and when.
Korea – Positioning in Ecopro, JYP Entertainment, Hanwha Ocean, Hanmi Semi, CJ Corp, E-Mart
- Ecopro (086520 KS), Jyp Entertainment (035900 KS), Hanwha Ocean (042660 KS), Hanmi Semiconductor (042700 KS), CJ Corp (001040 KS) and E Mart (139480 KS) have been on investors/traders radars recently.
- There will be liquidity demand on the stocks in a week and there is pre-positioning on a lot of the stocks.
- Since 10 August, retail investors have net bought Jyp Entertainment and E Mart, foreigners have net bought Ecopro, Hanwha Ocean and Hanmi Semiconductor, while local institutions have net bought CJ Corp.
Golden Eagle Retail (3308 HK): Scheme Vote on 15 September
- Golden Eagle Retail (3308 HK)‘s scheme document is out, with the court meeting scheduled for 15 September. The IFA considers the HK$6.88 per share offer fair and reasonable.
- The key condition is approval by at least 75% of disinterested shareholders (<10% of all disinterested shareholders rejection). The shareholder with a blocking stake has provided an irrevocable.
- This is a done deal which help by the material derating of peers. At the current price of HK$6.75 and for the 17 October payment, the gross/annualised spread is 1.9%/13.4%.
M&A Research Institute Holdings (9552) TOPIX Inclusion
- Yesterday, M&A Research Institute (9552 JP) announced it would list on the TSE Prime section on 29 August, which means it will join TOPIX at the close of 28-Sep-2023.
- This is NOT a surprise. On 27 June, the company announced a secondary offering of 1.631mm shares (by the founder/CEO), and said it had applied for TSE Prime transfer.
- I take a look at how this could play out.
EOFLOW/Medtronic Tender: Irrational Exuberance
- Eoflow (294090 KS) shares were up 4.4% on the back of Medtronic Plc (MDT US)’s earnings call comment that it expects the acquisition to close at the end of 2023.
- The bear view is that Medtronic’s messaging remained unchanged as it is still assessing Insulet Corp (PODD US) lawsuit and the potential impact on the timing and/or pricing.
- The bull view is that Medtronic’s comment underscores its commitment to close the transaction. It’s tough to take a call on risk/reward profile – at best it’s a brave buy.
Quiddity Leaderboard F100/250 Sep 23: Several Changes Including Potential Surprises
- In this insight, we take a look at the potential index changes for F100 and F250 in the run up to the September 2023 Rebalance.
- I expect four changes for F100 and seven changes for F250 based on the latest available data.
- However, with five more trading days left for the base date and with many names lurking close to the border, the rankings can still change.
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