In today’s briefing:
- SATS to Buy Worldwide Flight Services (WFS) As Private Equity Exits
- Bilibili (9626 HK): Implications of Dual Primary Listing
- SATS Agrees to Acquire WFS for an EV of S$3.1 Billion
- Soon-To-Be Cashed-Up Jasmine After Broadband Sale
- TIGER (FnGuide) Top 10 ETF Rebalancing: Noteworthy Changes Emerging
- DAX/MDAX/SDAX Quiddity Leaderboard Dec 22: Porsche AG IPO Makes Things Interesting
- Biffa Accepts Lowered Bid from Energy Capital Partners
- EQD | FTSE100 (UKX Index): GBPUSD Vol Has Exploded Offering Opportunites to Spread Against FTSE100
SATS to Buy Worldwide Flight Services (WFS) As Private Equity Exits
- SATS (SATS SP) has announced that it is buying Worldwide Flight Services (WFS) from an affiliate of Cerberus Capital Management at an Enterprise Value of €2.25bn (S$3.107bn).
- The cash consideration is €1.187bn (S$1.639bn) and will likely be financed by an equity fund raising. This could be a rights issue and could be combined with a private placement.
- Expect the stock to drop once it resumes trading. A significant drop from current levels could provide a buying opportunity as the rights issue could be backstopped.
Bilibili (9626 HK): Implications of Dual Primary Listing
- Earlier today, Bilibili (9626 HK) announced the voluntary conversion of its Secondary Listing on the HKEX (388 HK) to a Dual Primary Listing effective 3 October.
- Though the timing is tricky, this could result in the stock not being deleted from the Hang Seng China Enterprises Index (HSCEI INDEX) at the December rebalance.
- This could also lead to inflows at the December rebalance from Hang Seng China Enterprises Index (HSCEI INDEX) and Hang Seng Tech Index (HSTECH INDEX) trackers.
SATS Agrees to Acquire WFS for an EV of S$3.1 Billion
- SATS (SATS SP) agreed to acquire Worldwide Flight Services (WFS), the world’s largest air cargo handling firm, from Cerberus Capital for a cash consideration of S$1,639 million.
- The base funding plan is based on a S$1.7 billion equity raise. The uncertain structure and timing of the equity raise will be a short-term overhang.
- The acquisition is conditional on shareholder and regulatory approvals. Assuming no synergies, our pro-forma price per share is S$4.97, a 28.5% upside to the last close.
Soon-To-Be Cashed-Up Jasmine After Broadband Sale
- Jasmine International (JAS TB) is in the home straight to sell its 99.8% interest in Triple T Broadband (TTTBB), and 19% stake in Jasmine Broadband Internet Infrastructure Fund (JASIF TB).
- With Bt 32.4bn in proceeds coming through the door, JAS would have net cash of ~Bt 24.8bn against a current market cap of ~Bt 24bn.
- This sounds like a situation worth a second look. So I look.
TIGER (FnGuide) Top 10 ETF Rebalancing: Noteworthy Changes Emerging
- There was a substantial increase in the AUM even in the current market condition. More funds must have sought blue chip stocks as relatively safe assets in this volatile market.
- Celltrion and LG Energy Solution will likely replace KB Financial and Shinhan Financial. On the other hand, POSCO is out of the race even with a +5%p float rate change.
- LG Energy also has an up-weight event of the KOSPI 200. Since these passive flow events have an interval of only one day, we expect a fairly concentrated passive impact.
DAX/MDAX/SDAX Quiddity Leaderboard Dec 22: Porsche AG IPO Makes Things Interesting
- In this insight, we take a look at the names leading the race to become ADDs/DELETEs for the DAX, MDAX, and SDAX Indices.
- Based on current share prices, there are no changes for the DAX index. However, there could be multiple changes for the MDAX and SDAX indices.
- I have also discussed the index implications for the Porsche AG (P911 GR) IPO.
Biffa Accepts Lowered Bid from Energy Capital Partners
- ECP lowers its initial offer to 410p/share in cash plus the final dividend of 4.69p/share (28% premium, implied equity value is €1,269 million, implied EV is €1,847 million).
- The offer represents 1.2x EV/Fwd revenue, 8.3x EV/Fwd EBITDA and 32.1x Fwd P/E. Suez was taken at similar multiples: 1.5x, 8.1x and 27.4x respectively. My updated fair value estimate (DCF-based) is 410.6p.
- The equity value prior to approach was undemanding. The offer price seems fair. Gross spread (including final dividend) is 2.1%. Reiterate Long BIFF LN.
EQD | FTSE100 (UKX Index): GBPUSD Vol Has Exploded Offering Opportunites to Spread Against FTSE100
- GBP depreciation and UK mini budget have triggered a spike in volatility to decade highs
- Currency vol is trading at extreme levels vs Equity vol offering trade opportunities
- FTSE100 is trading cheap and we suggest a smart way to play upside
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