In today’s briefing:
- Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?
- Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index
- Quiddity Leaderboard ChiNext & ChiNext 50 Jun 25: Great Momentum for the Exp ADDs Vs Exp DELs Trade
- Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final
- Key Info We Need to Know About Boosting Predictability of Dividend Record Dates in Korea
- Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light
- Align Partners Goes Activist on Coway
- Quiddity Leaderboard F100/F250 Mar 25: Mega Addition for Coke & Multiple Intra-Review Changes Likely
- Smart Share Global’s Privatization Proposal: Evaluating the 20% Spread and Potential Offer Increase
- Liquid Universe of European Ordinary and Preferred Shares: January’25 Report
Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?
- You might have to go all the back to Guoco Group Ltd (53 HK)‘s 2012/2013 unconditional cash offer, which was ostensibly blocked by First Eagle AND Elliott Advisors.
- Otherwise, it’s slim pickings. Past Schemes or Tender Offers arguably failed as minorities were simply not supportive. There are exceptions, like Soho China (410 HK) and TCM (570 HK)
- IF LVC wish to remain active in this space/region, they appear to be going about it in a counterproductive way. I still don’t understand why they would want to block.
Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index
- CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
- In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
- Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.
Quiddity Leaderboard ChiNext & ChiNext 50 Jun 25: Great Momentum for the Exp ADDs Vs Exp DELs Trade
- The ChiNext index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
- The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
- We see 10 changes for the ChiNext index and 5 changes for the ChiNext 50 index in the next index rebal event. Combined it is about US$1bn to trade one-way.
Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final
- Back on the 6th December 2024, Lifestyle China (2136 HK), a PRC department store operator, announced a Scheme from Thomas Lau, its chairman/CEO and major shareholder (74.91%, including concert parties).
- The HK$0.913 Offer price was miserly 21.7% premium to last close. But not declared final.
- The Offer deserved a bump, and Lau has obliged. However, the revised HK$0.98/share bid, a 30.6% premium to undisturbed, remains underwhelming. Lau has declared terms final.
Key Info We Need to Know About Boosting Predictability of Dividend Record Dates in Korea
- Major banks, Hyundai Motor, POSCO Holdings, and companies like HMM, which updated their articles, will likely set dividend record dates pre-AGM in the mid-to-late February window.
- Track backwardation in March futures for mispricings. Companies will likely follow last year’s playbook: AGM in mid-to-late March, record date 3–4 weeks prior, announcement 2 weeks ahead.
- Opportunity lies in the March futures basis spread between February contract and record date announcement. Watch those for potential dividend hikes and futures mispricing ahead.
Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light
- Lifestyle China (2136 HK) disclosed a revised offer from Mr Thomas Lau at HK$0.98 per share, a 7.3% premium to the previous HK$0.913 offer. The offer has been declared final.
- The bump was unsurprising. Crucially, the shares have traded above the revised offer on 20 of the 25 trading days since the previous offer was announced.
- The revised offer remains light, and minorities remain unimpressed. The high AGM minority participation rates remain a vote risk. Head for the exit as the shares are trading at terms.
Align Partners Goes Activist on Coway
- After the market close on 16 January, it was reported that Align Partners started to go activist on Coway Co Ltd (021240 KS).
- Align Partners sent a public letter to Coway demanding improvements to shareholder returns and measures to enhance the independence of the board of directors.
- The combination of higher shareholder returns, low valuations, and Align Partners putting further activist pressure are likely to lead to continued outperformance of Coway relative to KOSPI this year.
Quiddity Leaderboard F100/F250 Mar 25: Mega Addition for Coke & Multiple Intra-Review Changes Likely
- In this insight, we take a look at the potential index changes for the F100 and F250 indices in the run-up to the March 2025 index rebal event.
- We see up to four M&A-related intra-review changes in the run up to the March 2025 review.
- Our latest estimates suggest there could be one regular change for the F100 index and one change for the F250 index during the March 2025 rebalance.
Smart Share Global’s Privatization Proposal: Evaluating the 20% Spread and Potential Offer Increase
- Smart Share Global received a non-binding privatization proposal at $1.25/ADS, with a 20% spread after fees.
- The buyer group holds 16% economic interest and 64% voting power; Trustar Capital’s involvement signals deal commitment.
- EM’s power bank rental business is breakeven; cashflow positive mainly due to $440m cash pile interest income.
Liquid Universe of European Ordinary and Preferred Shares: January’25 Report
- Since mid-December, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (8 have widened, 11 tightened) with few changes in the trends.
- Telecom Italia savers are trading at 18.5% premium to ords; Handelsbanken B at 32.4% premium to A. The discount of Grifols B has tightened, some await a comeback from Brookfield.
- Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe. Recommended trades long ordinary / short preferred shares: Henkel, Roche, SSAB Svenska Stal, Telecom Italia.
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