In today’s briefing:
- Itochu To Take Over Itochu Techno Solutions (CTC (4739 JP)) Just As Growth Jumps
- ITOCHU Techno-Solutions (4739 JP): ITOCHU’s JPY4,325 Tender Offer
- KLINE (9107) Ups Shareholder Return – Fun & Games May Ensue
- E-Guardian (6050 JP): CHANGE Holdings’ Partial Tender Offer
- Hong Kong CEO & Director Dealings (2 August): Flat Glass, Arts Optical, Sky Light Holdings
- Quiddity Leaderboard BSE/SENSEX Dec 23: 7 Changes for BSE 100 and 5 Changes for BSE 200
- SBI Affiliate To Buy 45-49% of E-Guardian (6050) In Partial Tender Offer
- EQD | SPX INDEX WEEKLY Supports After US Credit Downgrade
Itochu To Take Over Itochu Techno Solutions (CTC (4739 JP)) Just As Growth Jumps
- Itochu Corp (8001 JP) today announced it had agreed with 61%-owned Itochu Techno Solutions (4739 JP) sub to take over CTC and squeeze out minorities.
- The stock released earnings mid-day, somehow, but not on TDNet until post-close. The stock jumped in the last two hours. The Tender Offer is at a 10% premium to close.
- Growth will be up, and there are lots of financial assets and net receivables so this is 8+x March 2025. Itochu is not overpaying. But there will be no counter.
ITOCHU Techno-Solutions (4739 JP): ITOCHU’s JPY4,325 Tender Offer
- Itochu Techno Solutions (4739 JP) has recommended Itochu Corp (8001 JP)’s tender offer of JPY4,325 per share, an 18.7% premium to the undisturbed price (1 August).
- 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 5.43% ownership ratio.
- The minimum acceptance condition requires a 14% minority acceptance rate. This is doable as the tender price is attractive and equals the 20-year share price high.
KLINE (9107) Ups Shareholder Return – Fun & Games May Ensue
- Today, Kawasaki Kisen Kaisha (9107 JP) announced Q1 earnings. As expected, net was WAY down on weak container business. But the company revised up H1 and Full-Year.
- KLINE increased its FY2023 payout, upping its expected buyback plan from ¥50bn to ¥60bn. This is still cheap at 8.5x and 0.7x book, and there is non-container growth.
- The structure of the buyback deserves attention. It may deserve a very short-term trade. The buyback construct has the possibility of “fun and games.”
E-Guardian (6050 JP): CHANGE Holdings’ Partial Tender Offer
- E Guardian Inc (6050 JP) has announced a partial tender offer and third-party allotment with Change Inc (3962 JP). CHANGE will subscribe for 1.5 million shares at JPY2,099 per share.
- The tender offer is for a minimum of 3.7 million and a maximum of 4.3 million shares at JPY3,000 per share, a 42.9% premium to the undisturbed price.
- The tender offer is reasonable. The minimum acceptance condition requires a 37% minority acceptance rate. A 100% minority participation rate implies a minimum proration is 42.39%.
Hong Kong CEO & Director Dealings (2 August): Flat Glass, Arts Optical, Sky Light Holdings
- The data in this insight is collated from the “shareholding disclosure” link on the HKEx website
- Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
- Stocks mentioned in this regular insight include Flat Glass (6865 HK), Arts Optical Intl Hldgs (1120 HK), and Sky Light Holdings Ltd (3882 HK).
Quiddity Leaderboard BSE/SENSEX Dec 23: 7 Changes for BSE 100 and 5 Changes for BSE 200
- In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 Indices in the December 2023 Rebalance.
- In July, we saw the deletion of HDFC Limited (HDFC IN) from several indices in this family which triggered multiple intra-review index changes.
- At present, I do not see any changes for the SENSEX index but I see seven ADDs/DELs for BSE 100 and five ADDs/DELs for BSE 200.
SBI Affiliate To Buy 45-49% of E-Guardian (6050) In Partial Tender Offer
- Today, Change Inc (3962 JP) (30%-owned by SBI Holdings (8473 JP)) announced a Tender Offer to buy 32-36.9% of E-Guardian, followed by a third-party placement to get them to 45-49%.
- Small cap E-Guardian does internet services support, ad processing, cyber security (their fastest growing segment) and top line has been growing.
- The partial offer is big enough to matter, and up 50%. It is worth a look for people who like small cap special sits.
EQD | SPX INDEX WEEKLY Supports After US Credit Downgrade
- The S&P 500 INDEX rally that started in October 2022 is currently encountering some turbulence, possibly due to various factors including the recent US credit downgrade by Fitch.
- The current WEEKLY pullback may be an opportunity to accumulate LONG position, buy& hold trade.
- The price area to buy where is between 4540 and 4332: probability of the uptrend resuming from there is between 50% and 75% based on current pattern readings.
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