In today’s briefing:
- StubWorld: More Partial Offers In The Hanwha Group Complex
- Examining the Severity of Proration Risk in the Hanwha Galleria Tender Offer
- EQD | HSI May Pull Back, Levels to BUY For Rally Continuation In September
StubWorld: More Partial Offers In The Hanwha Group Complex
- After the Kim family-backed Hanwha Energy completed Hanwha Corporation‘s Partial Offer last month, Hanwha Galleria (452260 KS)‘s VP Kim Dong-seon has now launched a Partial Offer for 17.5% in Galleria.
- Preceding my comments on Hanwha are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
Examining the Severity of Proration Risk in the Hanwha Galleria Tender Offer
- The Hanwha Galleria tender offer has no cancellation risk but carries proration risk, keeping the spread at around 7%.
- For Hanwha Galleria, most floating shares are held by retail investors, and the smaller float size compared to Hansol Logistics further reduces proration risk.
- Even though the actual trading volume might be a concern, it’s still worth thinking about going for an aggressive strategy to take advantage of the spread, which is around 7%.
EQD | HSI May Pull Back, Levels to BUY For Rally Continuation In September
- We have correctly forecasted a August rally for the Hang Seng Index in previous insights, here and then here – the rally is on, but a pullback is coming.
- The pullback may come in this week or the next, but it’s probably behind the corner, the index can continue higher after the pullback.
- In this insight we want to expose what are the levels to buy LONG to benefit from a highly probable continuation of the rally in September.
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