In today’s briefing:
- CMCDI (133 HK)’s Proposals Light On Detail
- BBVA/Sabadell: Adjustment of Exchange Equation
- Market Musings – Reawakening The Animal Spirits
- City of London Investment Group (CLIG): Good fund performance and solid results
CMCDI (133 HK)’s Proposals Light On Detail
- Argyle Street Management (ASM), a 9.01% shareholder in China Merchants China Direct Investments (133 HK), has been (very) publicly angling for change in this closed-end fund. Here is their website.
- The core issue is CMCDI’s P/NAV ratio of 0.41x compared to closed-end fund peers of 0.8x-0.9x.
- CMCDI has finally responded to ASM’s overtures with the prospect of a share buyback and a special dividend. But details are thin on the ground.
BBVA/Sabadell: Adjustment of Exchange Equation
- BBVA has updated its hostile takeover offer to Banco Sabadell shareholders, proposing a cash payment of €0.29 and modifying the exchange ratio to 1 BBVA SM x 5.0196 SAB SM.
- The adjustment aims to account for the dividends paid by both banks, as outlined in the initial announcement from May 2024. Current gross spread (ex-dividend) is -2.99%.
- I believe this adjustment (merely optical) will be insufficient to convince Sabadell’s retail shareholders, many of whom are also clients and have an emotional attachment to the bank.
Market Musings – Reawakening The Animal Spirits
- The report from Delphi Digital discusses significant macroeconomic changes, including the Federal Reserve’s move to lower interest rates and China’s liquidity injections, creating a positive environment for risk assets such as cryptocurrencies.
- In the crypto markets, there is growing optimism as BTC shows signs of a trend reversal and altcoins stage rallies.
- ETF inflows, particularly in BTC, are increasing after a slow summer.
City of London Investment Group (CLIG): Good fund performance and solid results
- City of London has announced its full-year results for 2024.
- As stated in the trading statement, FUM was $10.24bn, a 9% increase over the year.
- While market performance offset net outflows, there was a significant improvement in the latter in the second half, which bodes well going forward.
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