In today’s briefing:
- SSE50 Index Rebalance Preview: Financials Staging a Comeback as Expected Trade Tops US$2bn
- Eureka Group (EGH AU): Aspen’s Sweetened Offer
SSE50 Index Rebalance Preview: Financials Staging a Comeback as Expected Trade Tops US$2bn
- Completing three-quarters of the review period, 6 stocks are in inclusion zone and 9 in deletion zone. However, there can be a maximum of 5 changes at a review.
- We estimate a one-way turnover of 6.8% at the June rebalance leading to a one-way trade of CNY 7.35bn (US$1.02bn). Index arb balances could increase the impact on the stocks.
- The potential adds have outperformed the potential deletes and the SSE50 Index (SSE50 INDEX) over the last few months and could continue to do so as positioning builds up.
Eureka Group (EGH AU): Aspen’s Sweetened Offer
- On the 2 March 2023, Aspen Group (APZ AU) made an all-scrip NBIO for Eureka Group (EGH AU), a senior accommodation rental play. The implied A$0.399/share Offer was subsequently rejected.
- Aspen held 13.7% of shares out at the time, having acquired the stake in December 2022. Aspen has returned with all-scrip off-market Offer with an improved implied price of A$0.431/share.
- The Offer is contingent of Aspen getting to 50.1% of shares out. Eureka said it hasn’t received a formal approach. I think they’ll ask for more gruel.
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