In today’s briefing:
- S&P/ASX Index Rebalance Preview: Moving the Right Way
- Socionext (6526) TOPIX Inclusion
- Weekly Deals Digest (23 Oct) – Link, Nearmap, Pushpay, Tyro, Singapore Medical, DTAC/True, Blibli
- Issues with WCP & SillaJen for KOSDAQ 150 Special Entry in December
- Jinke Smart (9666 HK): Boyu’s Offer Now Open
- Merger Arb Mondays (24 Oct) – Eagle Cement, Fengxiang, Lifestyle, Jinke Services, Genex, Nearmap
S&P/ASX Index Rebalance Preview: Moving the Right Way
- We see one potential change for the S&P/ASX 50 Index and two potential changes for the S&P/ASX 200 at the December rebalance, though some stocks are close to the cutoffs.
- The potential passive buying on the S&P/ASX 200 (AS51 INDEX) adds will exceed 11 days of ADV while the impact on the other stocks ranges from 1.5-4 days of ADV.
- Most stocks have been moving the right way and there will be pre-positions built up on some of the stocks. Shorts have been active on a few names too.
Socionext (6526) TOPIX Inclusion
- System-On-Chip designer and IP purveyor Socionext (6526 JP) is a recent IPO in Japan, born from a spinout of Fujitsu and Panasonic system LSI operations 7+ years ago.
- Having listed on TSE Prime from the outset, that means it gets TOPIX inclusion at the close of trading 29 November.
- Inclusion Float is a bit nebulous. There is a chance we get official company data prior to the TSE announcement, in which case we know more by cob 31 October.
Weekly Deals Digest (23 Oct) – Link, Nearmap, Pushpay, Tyro, Singapore Medical, DTAC/True, Blibli
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments – Giant Biogene Holding (GBH HK) will launch a US$500 million HKEx IPO this week. Blibli (1437710D IJ) has launched an IDR8.2 trillion (US$530 million) Indonesian IPO.
- Event-Driven developments Link Administration (LNK AU), Nearmap Ltd (NEA AU), Pushpay Holdings (PPH NZ), Tyro Payments (TYR AU), China Vast Industrial Urban Development (6166 HK), Singapore Medical (SMG SP), DTAC/True.
Issues with WCP & SillaJen for KOSDAQ 150 Special Entry in December
- Two other names aim at Special Entry: WCP and SillaJen. Their listing dates are September 30 and October 13. So, they are technically eligible. But they each have their issues.
- As for WCP, MSCI has not yet assigned a GICS sector. It is unlikely that KRX will put WCP into the KOSDAQ 150 without GICS confirmation.
- SillaJen is technically eligible as its ADMINISTRATIVE designation got terminated. But the rule allowing for KRX’s arbitrary judgment can act as an uncertainty factor.
Jinke Smart (9666 HK): Boyu’s Offer Now Open
- On the 27th of September, PRC-incorporated property management play Jinke Smart Services (9666 HK) announced a voluntary cash offer at HK$12/share, a 33.04% premium to last close.
- Boyu, the Offeror, together with concert parties, hold more than 60%. The Offer is contingent on regulatory approvals and 7.71% of shares out tendering. The tendering condition can be waived.
- The Composite Document has now been despatched. The first closing date is the 14 November.
Merger Arb Mondays (24 Oct) – Eagle Cement, Fengxiang, Lifestyle, Jinke Services, Genex, Nearmap
- We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
- Highest spreads – 21Vianet Group (VNET US), Alliance Aviation Services (AQZ AU), 111 Inc (YI US), Genex Power Ltd (GNX AU), O2Micro International (OIIM US), Eagle Cement Corp (EAGLE PM).
- Lowest spreads – Tyro Payments (TYR AU),Nitro Software Ltd (NTO AU), OZ Minerals Ltd (OZL AU), Tassal (TGR AU), China Vast Industrial Urban Development (6166 HK), PTB.
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