In today’s briefing:
- Standard Chartered: Has FAB Gone Cold Or Just Cooling Off?
- Dai Nippon Printing – Activism On Easy Street
- Big Link REIT (823 HK) Rights Offering
- Sabana REIT (SSREIT SP): Volare’s Partial Offer Is Open
Standard Chartered: Has FAB Gone Cold Or Just Cooling Off?
- Back on the 5 January, First Abu Dhabi Bank (FAB DH) said it had considered a bid for Standard Chartered (STAN LN/2888 HK), but was no longer evaluating an Offer.
- Such a statement kickstarts a six-month cooling-off period whereby FAB is restricted from reloading. This means all deal work must cease. Unless another bidder emerges or STAN’s board approves.
- In a curious development, STAN’s shares popped ~11% yesterday, on no apparent news.
Dai Nippon Printing – Activism On Easy Street
- Dai Nippon Printing’s announcement that it would double its RoE target in its next MTP was a pleasant surprise.
- Together with saucy hints that future buybacks could be the biggest in its history this has propelled the stock to a post-2007 high.
- We think Elliott has found an easy win here and consider this likely to end as a standout success for activism in Japan.
Big Link REIT (823 HK) Rights Offering
- After being halted this morning before the start of trade, post-close, Link REIT (823 HK) announced a fully-underwritten Rights Offering.
- The Rights Offering intends to raise HK$18.8bn issuing 1 Right for every 5 Shares held, at a subscription price of HK$44.20, a 26% discount to TERP.
- This will take an already under-levered REIT and add more capital to it. And there is going to be selling pressure at some point.
Sabana REIT (SSREIT SP): Volare’s Partial Offer Is Open
- Sabana Industrial REIT (SSREIT SP)’s partial offer from Volare to acquire a maximum of 109.6 million units at S$0.4504 per unit (S$0.465 in cash – S$0.0146 2H2022 distribution) is open.
- The offer is conditional on 10% minimum acceptances. Minorities appear willing sellers as both Volare and Quarz increased their unitholding over the last 12 months.
- Quarz is supportive but its intentions are unclear. Based on a proration of 16.70% and at the last close of S$0.420 per unit, the breakeven price is S$0.415 per unit.
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