In today’s briefing:
- Toshiba (6502) – There Is Actual News, and There Are Datapoints Which Masquerade as News
- Tyro Payments In Talks With Westpac
- Netmarble Debt Risk Victim: HYBE or NCsoft or Both?
- Singapore Medical’s VGO: IFA Says It Is Not Fair but Reasonable
- China VAST (6166 HK): Expect November Scheme Meeting As Pre-Cons Satisfied
- NIFTY Indices: HDFC/HDFCB Merger Driven Market Consultation
- Tyro Confirms Westpac as One of the Interested Suitors
- Bobst’s Minorities Takeout: Additional Acceptance Period
- Thailand SET50 Quiddity Leaderboard Dec 22: BJC Is the Most Interesting Name
Toshiba (6502) – There Is Actual News, and There Are Datapoints Which Masquerade as News
- A week after JIP gets preferred status and we had rumoured bid prices, we now have an article saying JIC/Bain is still in it, and a new article today.
- Today’s “new” article says JIP’s bid price is what the first leak suggested, which is below ¥6,000/share. Other articles suggest bidders are finding that securing financing is tough.
- Investors should look at process and understand the difference between this one and most others. It matters. Some news is not news, other than telling you the dance has started.
Tyro Payments In Talks With Westpac
- Back on the 8 September, payment provider Tyro Payments (TYR AU) rejected a proposal from a Potentia-led consortium at A$1.27/share, by way of a Scheme.
- Tyro has now announced it has received approaches from several parties, including Westpac (WBC AU). “None of these approaches are sufficiently definite … to warrant further disclosure at this time“.
- Shares are currently trading at A$1.59/share. Tyro recently raised its FY23 EBITDA guidance to A$28mn-34mn, up from A$23mn-29mn.
Netmarble Debt Risk Victim: HYBE or NCsoft or Both?
- Netmarble did a one-year rollover for the stock loan used for the SpinX acquisition. The maturity is again one year, and the principal amount is ₩1.5T.
- The HYBE stake is newly included as collateral at an estimated LTV ratio of 50% because the value of NCsoft’s stake further declined, and the LTV ratio was subsequently lowered.
- Applying the 140% loss cut ratio to HYBE and NCsoft will lead to a margin call when each stock declines 30% from the current price.
Singapore Medical’s VGO: IFA Says It Is Not Fair but Reasonable
- The IFA has declared the Singapore Medical (SMG SP) VGO (S$0.37 cash or one new share in the offeror) from management (chairman, CEO, exec director) is “not fair but reasonable.”
- The offer is light, and hitting the 90% minimum acceptance condition will be challenging. There is a remote chance of a bump as the offer has not been declared final.
- Irrevocables remain at 51.67% of outstanding shares. The current gross spread of 1.4% is not an attractive risk/reward profile. Take profits and head for the exit.
China VAST (6166 HK): Expect November Scheme Meeting As Pre-Cons Satisfied
- Back on the 9 June, Urban planner China Vast Industrial Urban Development (6166 HK) received a pre-conditional Offer, by way of a Scheme, from China Jinmao Holdings (817 HK).
- The cancellation (and final) price is HK$2.40/share, a ~30% premium to the undisturbed price. Pre-Conditions include approvals from SAMR, SASAC, and NDRC.
- Those pre-cons have now been satisfied. The Scheme Doc is currently expected to be dispatched on or before the 31 October. There may be some slippage.
NIFTY Indices: HDFC/HDFCB Merger Driven Market Consultation
- There was a lot of confusion around how NSE Indices would handle the HDFC Limited (HDFC IN) / HDFC Bank (HDFCB IN) merger in its indices.
- The market consultation seeks to change the index methodology to bring it in line with other index providers. That will result in much lower turnover than the existing index methodology.
- Pidilite Industries (PIDI IN) is a high probability add to the NIFTY Index possibly in the first quarter of 2023. There will also be changes to Nifty Next 50 Index.
Tyro Confirms Westpac as One of the Interested Suitors
- Tyro Payments (TYR AU) confirmed that it has “received approaches from several parties expressing interest in a potential change of control transaction, including Westpac Banking (WBC AU).”
- Tyro previously rejected a A$1.27 offer from the Potentia consortium. Grok’s get-out clause with Potentia sets the floor price of a competing bid at A$1.52 per share.
- The last close of A$1.59 is higher than the floor price. Triangulating the value of a rival bid across several data points suggests a competing offer of around A$2.
Bobst’s Minorities Takeout: Additional Acceptance Period
- JBF now controls 63.66% of the share capital of Bobst. Tendered shares represent just c.10.3%. The additional acceptance period runs until 21 October.
- The CHF 78/share offer represents 6.6x EV/Fwd EBITDA vs. 7.5x for Swiss industrial machinery peers. Unsurprisingly, the shares have been trading slightly above terms since the (opportunistic) offer announcement.
- If 3.01% of shares are tendered during the reopened period, JBF could potentially delist the company. Although this could be challenged in courts, buying above the offer price seems risky.
Thailand SET50 Quiddity Leaderboard Dec 22: BJC Is the Most Interesting Name
- In this insight, we take a look at the potential index changes for the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) between now and the December 2022 Rebalance.
- There is an ongoing market consultation with significant implications for constituent selection and there is also a potential intra-review change due to the DTAC-TRUE merger.
- Based on the latest available data, there could three or four index changes during the December 2022 Rebalance depending on the outcome of the DTAC-TRUE merger.
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