In today’s briefing:
- Hong Kong Aerospace Tech’s (1725 HK) US$1bn Rocket-Launch Site
- Meritz Fire & Marine Insurance: Treasury Shares Cancellation of 5.9% of Outstanding Shares
- Kingston Financial’s (1031 HK) Vote on 9 February
- DAX/MDAX/SDAX Quiddity Leaderboard Mar 23: Vantage Tower and Other Interesting Names
- ETF Arbitrage in Korea: Names Suitable for Pair Trades
- Kingston Financial (1031 HK): 9th Feb Scheme Vote. IFA Says Fair
Hong Kong Aerospace Tech’s (1725 HK) US$1bn Rocket-Launch Site
- On the 9th of January, 2023, the Republic of Djibouti signed an MOU with Hong Kong Aerospace Technology (1725 HK) (HKAT) to develop a (reported) US$1bn international commercial “spaceport”.
- In the middle of last year, Djibouti announced plans to launch two nanosatellites to facilitate farming and other related activities.
- HKAT, a recent back-door listing, has a market cap of US$258mn. Wholly-owned subsidiary Gang Hang Ke (Shenzhen) Space Technology, has been successfully involved in the launch of ten satellites.
Meritz Fire & Marine Insurance: Treasury Shares Cancellation of 5.9% of Outstanding Shares
- After the market close today, Meritz Fire & Marine Insurance announced that it will cancel 6.57 million treasury shares, representing 5.9% of its outstanding shares.
- This treasury shares cancellation by Meritz F&M Insurance should have a continued positive impact on its share price.
- Share cancellation by Meritz F&M Insurance and the need to adjust to higher merger ratio are likely to lead to Meritz F&M Insurance outperforming MFG in the next few days.
Kingston Financial’s (1031 HK) Vote on 9 February
- The Kingston Financial (1031 HK) scheme document is out with the scheme meeting scheduled for 9 February. The IFA considers the offer to be fair and reasonable.
- Key conditions include approval by at least 75% of independent shareholders (<10% of independent shareholders rejection) and the headcount test. No shareholder holds a blocking stake.
- Peer re-rating increases the headcount test risk. At the last close and for the 10 March payment, the gross and annualised spread is 5.3% and 42.2%, respectively.
DAX/MDAX/SDAX Quiddity Leaderboard Mar 23: Vantage Tower and Other Interesting Names
- In this insight, we take a look at the names leading the race to become ADDs/DELETEs for the DAX, MDAX, and SDAX Indices.
- Vantage Towers (VTWR GR) is currently undergoing a Tender Offer and this could have interesting index consequences over the next few weeks.
- As it stands, there seems to be one change between MDAX and SDAX and there are multiple names hovering close to the border for DAX, MDAX, and SDAX.
ETF Arbitrage in Korea: Names Suitable for Pair Trades
- As for the one using the creation/redemption mechanism, the tracking error (market value – NAV) is still too tight to call this an arbitrage opening.
- Then, at this point, we need to pay attention to ETF arbitrage from a pair trade perspective. There are a total of 3 pairs we can consider for this.
- The mean reversion cycle is still not short. However, the diversion range is not extensive, so we can aim for a relatively stable setup in a market with increased volatility.
Kingston Financial (1031 HK): 9th Feb Scheme Vote. IFA Says Fair
- The Scheme Booklet is now out and Kingston Financial (1031 HK)‘s shareholders can vote on Chu Yuet Wah’s Offer on the 9 February.
- The Cancellation price of HK$0.30/share was a 47.78% premium to the undisturbed prices. It will not be increased.
- Currently trading at a gross/annualised spread of 5.3%/44.4%, assuming payment on the 10 March.
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