In today’s briefing:
- Sembcorp Marine (SMM SP): MSCI Inclusion Confirmed as Shorts Surge
- Ecopro Co: Shorting Entry Points on CB Conversion Event
- China Renaissance (1911 HK): Loss of Face
- Sembcorp Marine (SMM SP) – MSCI Pulls a Surprise Late Inclusion – All Engines Reverse Full!
- SM Entertainment Mgmt’s Response on Its Opposition to HYBE’s Tender Offer
- Fujitec EGM Coming 24 Feb – It’s a Close-Run Thing
Sembcorp Marine (SMM SP): MSCI Inclusion Confirmed as Shorts Surge
- Keppel Corp (KEP SP) shares will trade ex-distribution on 23 February and the settlement of the new Sembcorp Marine (SMM SP) shares is expected to take place on 1 March.
- MSCI has announced the inclusion of Sembcorp Marine (SMM SP) in the MSCI Singapore Free Index (SIMSCI INDEX) at the close on 1 March.
- There are a lot of recent shorts on Sembcorp Marine (SMM SP) and there could be buying on the stock following the announcement of the MSCI inclusion.
Ecopro Co: Shorting Entry Points on CB Conversion Event
- For the recent conversion, the listing date is March 3rd, involving 500K shares. Despite the ongoing rally, there is a possibility of a significant price impact due to the volume.
- We still have 1,632,333 shares to be converted. This represents 6.5% of the SO. There is a high likelihood that these will also be applied for conversion soon.
- Assuming that it occurs in increments of 400-500K, there could be roughly 3-4 opportunities for shorting.
China Renaissance (1911 HK): Loss of Face
- China Renaissance (1911 HK) was once touted as a “leading investment bank and asset manager dedicated to the new economy“. At the time of its 1Q21 post-IPO high, it was.
- Late last Thursday, the 16 February, CR said it was unable to contact (hours, days, weeks?) Bao Fan, its chairman, CEO, and controlling shareholder. Shares subsequently fell 28%.
- Bao is the face of CR and instrumental in client dealing and complex large-scale deal making. Clarification is recommended before investors dip their toe back in the water.
Sembcorp Marine (SMM SP) – MSCI Pulls a Surprise Late Inclusion – All Engines Reverse Full!
- Last night, MSCI announced Sembcorp Marine (SMM SP) will be added to MSCI Standard effective 2 March as the KOM Consideration Shares become tradable. This is something of a surprise.
- That other index family announced a temp line would be added to the index on receipt by Keppel shareholders. This dramatically changes the Day1 overhang arithmetic.
- It erases most but not all of the Day 1 passive overhang, and means adding shares for the existing SMM portion. Medium-long-term active overhang is unchanged.
SM Entertainment Mgmt’s Response on Its Opposition to HYBE’s Tender Offer
- In this insight, we discuss our thoughts on S.M.Entertainment Co (041510 KS) management’s official response on why it is opposing HYBE (352820 KS)’s tender offer offer.
- Currently, about 85% of SM’s employees oppose HYBE’s proposed acquisition of nearly 40% stake in SM Entertainment.
- In the last week of February/early March, Kakao Group could make an official tender offer at prices of at least 140,000/150,000 won, in our view.
Fujitec EGM Coming 24 Feb – It’s a Close-Run Thing
- Fujitec management is under the gun. Last week, both major international proxy advisors – ISS and Glass Lewis – generally favoured Oasis’ Spill The Board candidate slates.
- Fujitec Co Ltd (6406 JP), of course, had their opinion on the matter (Additional Explanatory Material, Response re ISS, Response re Glass Lewis)
- How this breaks is a question. Shareholder structure analysis may take us there, but this could end mixed.
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