In today’s briefing:
- Halcyon Agri (HACL SP): Conditions Precedent Fulfilled, MGO at S$0.413
- Pushpay Holdings: 3rd March Scheme Meeting. IA Says Fair
- Pushpay (PPH NZ): Scheme Vote on 3 March but Deal Risks Are Emerging
- Despature Family/Somfy: Squeeze-Out, Delisting
- EQD | SX7E(SX7E Index): Banking Sector Has Been on Fire but Can It Last?
- Official Changes in Korea FSC’s Dividend Rules: Ramifications from a Trading Perspective
Halcyon Agri (HACL SP): Conditions Precedent Fulfilled, MGO at S$0.413
- The conditions precedent for China Hainan Rubber Industry (601118 CH) to acquire 36.00% of Halcyon Agri (HACL SP)’s outstanding shares from Sinochem International Corporation A (600500 CH) at US$0.315 is fulfilled.
- This will trigger an MGO at US$0.315 or S$0.413. On the assumption that the offer document is despatched by 17 February, the earliest close of the offer is 17 March.
- The MGO has a 50%+ minimum acceptance condition which requires around 40% of minorities’ acceptance rate. We think that this is achievable as the offer is attractive.
Pushpay Holdings: 3rd March Scheme Meeting. IA Says Fair
- Back on the 28 October, church donor management play Pushpay Holdings (PPH NZ/PPH AU) announced a Scheme with BGH/Sixth Street at NZ$1.34/share, a 30.1% premium to undisturbed.
- The Scheme Booklet is now out. The shareholder meeting will take place on the 3 March. The independent advisor concluded the Offer price is within its valuation range.
- Assuming 11 April payment, this is trading at a gross/annualised spread of 3.0%/18.0%.
Pushpay (PPH NZ): Scheme Vote on 3 March but Deal Risks Are Emerging
- Pushpay Holdings (PPH NZ)’s NZ$1.34 offer from Sixth Street/BGH is barely within the IE’s valuation range of NZ$1.33-1.53 per share. There is no “fair and reasonable” statement from the IE.
- Astonishingly, Sixth Street/BGH wrote to the Takeovers Panel to raise concerns about the IE’s report. The Takeovers Panel concluded that the IE report is not misleading or deceptive.
- A relatively concentrated register poses a risk, particularly considering the IE’s valuation range and the re-rating of a key peer. While possible, the probability of a bump is low.
Despature Family/Somfy: Squeeze-Out, Delisting
- Shareholders caved in, the Despatures now hold 94.38% of SOMFY’s share capital and 96.31% of voting rights. They asked the AMF for the launch of a squeeze‐out procedure (9 February).
- SOMFY will be delisted from Euronext Paris on 9 February. Following the squeeze-out, SOMFY intends to distribute an extraordinary dividend up to €620 million
- The total cost for the family is c. €1,285 million (plus investment banking and legal fees). Nearly half of that will be covered by a €620 million extraordinary dividend. Cool.
EQD | SX7E(SX7E Index): Banking Sector Has Been on Fire but Can It Last?
- SX7E broke out of its range and has rallied 15% this year alone
- ECB are close to the end of their hiking cycle and a lot of good news is already priced
- Recessionary fears still remain in Europe and we see an opportunity to hedge recent gains whilst vols are low
Official Changes in Korea FSC’s Dividend Rules: Ramifications from a Trading Perspective
- The new rules allow investors to decide whether to hold the stock until the dividend record date after knowing the dividend amount in advance.
- The new rules will be applied starting with the annual dividends for this fiscal year. We will know this year’s yearend dividend amount before deciding whether to receive it.
- From a trading perspective, the yearend dividend arb targeting ex-date mispricing will no longer be effective, which will likely change the swing trading strategy at the beginning of the year.
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