In today’s briefing:
- StubWorld: Young Poong & MBK Jostle For Control Of Korea Zinc (010130 KS)
- NAV Analysis of Young Poong and Three Potential Scenarios of Choi Family’s Strategy to Fight Back
- Hulic (3003) Launches TOB to Take Out Raysum (8890) – HUGE Win for Good Governance And Activism
- Clearing up Legal Confusion on Counter Offers and Getting a Clear Read on the Korea Zinc Tender
StubWorld: Young Poong & MBK Jostle For Control Of Korea Zinc (010130 KS)
- MBK has teamed up with Young Poong (000670 KS) to secure control of Korea Zinc (010130 KS) via Partial Tender Offers for Korea Zinc and Young Poong Precision (036560 KS).
- Preceding my comments on Young Poong, Korea Zinc, and Young Poong Precision 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%.
NAV Analysis of Young Poong and Three Potential Scenarios of Choi Family’s Strategy to Fight Back
- We have significantly raised the NAV of Young Poong to 965,193 won (up 105% than previously). Our current NAV estimate of the company is 150% higher than current price.
- Some traders have been positioning for Young Poong to be deleted from the KOSPI200 in the next round of rebalancing. Young Poong is not likely to be deleted from KOSPI200.
- We also provide three potential scenarios of the Choi family’s strategy to fight back to gain control of Korea Zinc.
Hulic (3003) Launches TOB to Take Out Raysum (8890) – HUGE Win for Good Governance And Activism
- The change in control of Raysum Co Ltd (8890 JP) has a complex backstory. But one week shy of two years ago, Oasis launched a buyout to own 65%.
- The company had a strong MTMP. Oasis paid ¥1,700/share to own 65%. The MTMP came through, there was an offering, and it stayed near ¥3,000/share.
- Now Hulic Co Ltd (3003 JP) has come out with a Tender Offer to buy the company for ¥5,913/share. That’s a 94% premium and 3.5x what Oasis paid 2yrs ago.
Clearing up Legal Confusion on Counter Offers and Getting a Clear Read on the Korea Zinc Tender
- Since Choi and his affiliates can’t buy shares directly, his only play is to recruit more white knights to boost his stake.
- He needs at least 6% from the 23% free float, costing over ₩800 billion. This hefty price tag is why the stock hasn’t moved much from the tender offer price.
- The market isn’t ruling out Hyundai getting aggressive to secure Korea Zinc’s nickel, making this a hot trading point during the tender offer.
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