In today’s briefing:
- GUPPY’s (5127 JP): Medley (4480 JP) Tender Offer at JPY3,250
- Index Rebalance & ETF Flow Recap: ASX, KS200, KQ150, HSIII, STTF, L&F, Costa Group, Japan, Bud APAC
- (Mostly) Asia-Pac Weekly Risk Arb Wrap: Genetron, Guppy, Weiqiao Textile, Taisho Pharma, T&K Toka
- Genetron (GTH US): Wide Spread Ahead of the 21 February Vote
- Activia Properties (3279) – Short-Term Higher-Impact Buyback on Better Fundamental Results
- Weekly Deals Digest (21 Jan) – Benefit One, GUPPY’s, T&K Toka, Weiqiao, Genetron, Amer Sports
- Last Week in Event SPACE: Benefit One, China Unicom, Zhejiang Expressway/ Zheshang Sec, Hollysys
GUPPY’s (5127 JP): Medley (4480 JP) Tender Offer at JPY3,250
- GUPPY’s Inc (5127 JP) has recommended Medley (4480 JP)’s tender offer of JPY3,250 per share, an 81.0% premium to the undisturbed price (19 January).
- The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the tender offer is set at a 10.19% ownership ratio.
- Despite the premium, the offer is light vs the IFA DCF valuation. Based on the irrevocables, the minimum acceptance condition requires a 23.4% minority acceptance rate, which is achievable.
Index Rebalance & ETF Flow Recap: ASX, KS200, KQ150, HSIII, STTF, L&F, Costa Group, Japan, Bud APAC
- The review period for a global index commenced last week and will run through this week as well.
- The announcement of the changes for the LQ45 Index should be announced in the coming week and will be implemented at the close on 31 January.
- Huge inflows to CSI 300 Index trackers during the week while there was a big outflow from Tracker Fund of Hong Kong (2800 HK).
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Genetron, Guppy, Weiqiao Textile, Taisho Pharma, T&K Toka
- I tally 46 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Two new deals discussed this week on Smartkarma: Genetron Holdings Ltd (GTH US)‘s take-private transaction; andMedley (4480 JP)‘s buy out of GUPPY’s Inc (5127 JP).
- Key updates took place on: Orecorp (ORR AU), Weiqiao Textile (2698 HK), Benefit One (2412 JP), Taisho Pharmaceutical (4581 JP), T&K Toka (4636 JP), and Hollysys Automation Technologies (HOLI US).
Genetron (GTH US): Wide Spread Ahead of the 21 February Vote
- Genetron Holdings Ltd (GTH US) shareholders will vote on the consortium’s US$4.08 per ADS offer on 21 February. The offer is light in comparison to historical trading ranges.
- Completion is conditional on shareholder approval, dissenting shareholders representing less than 15% of outstanding shares and regulatory approvals (NDRC, MoC and SAFE).
- Despite the light offer, the completion conditions should be met. At the last close price and end of March completion, the gross and annualised spread is 7.7% and 45.5%, respectively.
Activia Properties (3279) – Short-Term Higher-Impact Buyback on Better Fundamental Results
- Activia Properties (3279 JP) announced results Wednesday. Higher DPU on better rental income looks to continue next period, but an asset disposal will produce some drag ahead.
- Activia Properties also announced a buyback of 10% of ADV for the next four months.
- The REIT is slightly cheap to peers. Yield spread to JGBs is high which is good. It needs to be 10% higher to restart accretive equity offerings.
Weekly Deals Digest (21 Jan) – Benefit One, GUPPY’s, T&K Toka, Weiqiao, Genetron, Amer Sports
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments – Amer Sports (AS US), Ola Electric (1700674D IN) and Mixue Group (MIX HK) IPOs.
- Event-Driven developments – Benefit One Inc (2412 JP), GUPPY’s Inc (5127 JP), T&K Toka Co Ltd (4636 JP), Weiqiao Textile Co (2698 HK), Genetron Holdings Ltd (GTH US).
Last Week in Event SPACE: Benefit One, China Unicom, Zhejiang Expressway/ Zheshang Sec, Hollysys
- Dai Ichi Life (8750 JP) has the wherewithal, and probably the synergies to make a bump for Benefit One (2412 JP) work. M3 is clearly not in the driver’s seat.
- China United Network (600050 CH) is, for all intent and purpose, a pseudo-A to China Unicom (762 HK). Go long Unicom, short United due to Unicom’s significantly cheaper valuation.
- Zhejiang Expressway (576 HK) has had a stonking run since its rights issue. Look to unwind this set-up and take the other side: short Expressway, long Zheshang Securities (601878 CH).
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
