In today’s briefing:
- Sun Corp (6736) – Still Cheap
- A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening
- Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols
- Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan
- PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply
- Market Movers: Key Dates at a Glance (March 24-30)
- Weekly Update (ANGI, IAC, SNRE)
Sun Corp (6736) – Still Cheap
- Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
- Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit.
- Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.
A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening
- AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
- To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
- Lots of spreads see the HA premium less than 15%. That is historically tight.
Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments: DN Solutions (298440 KS) seeks to raise US$1.1 billion in a KRX IPO.
- Event-Driven developments: CK Hutchison Holdings (1 HK), Canvest Environmental Protection Group (1381 HK), ENN Energy (2688 HK), HKBN Ltd (1310 HK), Shandong Fengxiang (9977 HK), Spartan Resources (SPR AU).
Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan
- We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
- Highest spreads: Seven & I Holdings (3382 JP), OneConnect Financial Technology (OCFT US), Insignia Financial (IFL AU), Smart Share Global (EM US), Soundwill Holdings (878 HK).
- Lowest spreads: Makino Milling Machine Co (6135 JP), Shibaura Electronics (6957 JP), Domain Holdings Australia (DHG AU), Tonami Holdings (9070 JP), PointsBet Holdings (PBH AU).
PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply
- On the 18th June 2024, PC Partner (1263 HK)‘s board said it was considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
- A 30th August 2024 announcement provided clarity on a step-by-step approach for the HKEx withdrawal. A secondary listing on the SGX was established on the 15th November.
- The next step is to establish a dual-primary listing in Singapore. Then withdraw the HKEx listing. The key driver behind this exercise is ensure the uninterrupted supply of NVIDIAs GPUs.
Market Movers: Key Dates at a Glance (March 24-30)
- India: Index changes for Nifty indices will take place. Multiple option expiries are scheduled, impacting stocks and indices such as the NIFTY 50 Index, and the SENSEX Index.
- Asia-Pacific: Key events include Hong Kong’s earnings week and Tokyo CPI release, while Australia reports its Monthly CPI indicator.
- USA: Significant releases include the final Q4 2024 GDP figures and the PCE Price Index, the Fed’s preferred inflation gauge.
Weekly Update (ANGI, IAC, SNRE)
On March 31, 2025, IAC Inc (IAC) will spin off Angi Inc (ANGI). The first day of trading will be April 1st.
Transaction Structure: The spin-off is designed to be tax-free, providing IAC shareholders with direct ownership of Angi. This move will eliminate Angi’s dual-class share structure, transitioning to a one share/one vote system.
Distribution Ratio: IAC shareholders will receive approximately 0.5178 shares of Angi Class A common stock for each IAC share they hold. This ratio accounts for a planned 1-for-10 reverse stock split of Angi’s shares, effective March 24, 2025.
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