In today’s briefing:
- Choi Family Launches a Counter Tender Offer for Young Poong Precision
- Choi Drops a Counter-Tender for Young Poong Precision at ₩30,000 Before the Market Bell Tomorrow
- Namoi Cotton (NAM AU): Well Played LDC
- Tokyo Metro (9023 JP) IPO: Valuation Insights
- Aica Kogyo (4206) – Small Offering Chips Away At Cross-Holdings
- Young Poong Precision (036560 KS): Choi’s Opening Salvo
- Still No Decisive Breakout as SPX Tests 5783 Resistance; Ideal Time to Shift to Defensives
- KULR Technology Group Inc.
- KULR Technology Group Inc.
- Daiseki Co Ltd (9793 JP): 1H FY02/25 flash update
Choi Family Launches a Counter Tender Offer for Young Poong Precision
- Choi family has launched a counter tender offer for Young Poong Precision at the tender offer price of 30,000 won (20% higher than MBK’s 25,000 won tender offer price).
- The tender offer involves a plan to acquire 3,837,500 shares (24.36% of outstanding shares) of Young Poong Precision.
- All eyes are on the court’s decision on the injunction application for ‘prohibition of acquisition of treasury stocks by Korea Zinc’, which is expected to be announced on 2 October.
Choi Drops a Counter-Tender for Young Poong Precision at ₩30,000 Before the Market Bell Tomorrow
- Choi aims to acquire 3.84 million shares (24.36%) of Young Poong Precision at ₩30,000 each, with a tender period from October 2 to November 1, managed by Hana Securities.
- Seoul Economic Daily may not be as prominent, but they reliably scoop this type of news, making it likely Choi will announce their counter-tender for Young Poong Precision tomorrow.
- MBK targets the full 49.14% stake, while the Choi family seeks about half, creating proration risk, which may still make MBK’s lower offer more appealing to shareholders.
Namoi Cotton (NAM AU): Well Played LDC
- A$0.77/Share. That’s Louis Dreyfus Company (LDC)’s revised unconditional bid. Plus it now holds 47.66% after Samuel Terry Asset Management, Namoi’s largest shareholder, tendered into the revised term.
- Expect Namoi Cotton Co Operative (NAM AU)‘s board to shortly back LDC’s Offer. LDC’s Offer is $0.02/share above Olam Agri’s conditional bid.
- After LDC first approached Namoi in November last year, this is now done. Expect Olam to tender its stake, and fold its tent.
Tokyo Metro (9023 JP) IPO: Valuation Insights
- Tokyo Metro (9023 JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.
- We previously discussed the IPO in Tokyo Metro (9023 JP) IPO: The Bull Case and Tokyo Metro (9023 JP) IPO: The Bear Case.
- In this note, we discuss valuation. Our analysis suggests that Tokyo Metro is attractively valued at the IPO price compared to peer multiples.
Aica Kogyo (4206) – Small Offering Chips Away At Cross-Holdings
- On Monday, 30 September, shareholders of US$1.4bn market cap chemicals and housing materials supplier Aica Kogyo (4206 JP) announced a Secondary Share Sale. It’s small at 2% of market cap.
- The Offering is 2.1mm shares including greenshoe. The company also raised its H1 dividend guidance slightly (¥53/share to ¥56/share) and announced a buyback which should cover 57% of the offering.
- It’s a small deal. There are a lot more cross-holdings behind that but the company is cash-rich and the company is very cheap/underlevered on an LBO basis.
Young Poong Precision (036560 KS): Choi’s Opening Salvo
- The Choi family have launched a Tender Offer to acquire 3.937mn shares (25%) of Young Poong Precision (036560 KS) (YPP) at ₩30,000/share, 20% above MBK/Young Poong (000670 KS)‘s revised terms.
- YPP’s key attraction is its 1.85% stake in Korea Zinc (010130 KS), which is the ultimate prize in this tussle between the Choi and Jang families.
- Choi’s Offer runs from today (2nd October) to 21 October. There is no minimum acceptance threshold. If successful, the Choi’s stake increases to 60.45% from 35.45% currently.
Still No Decisive Breakout as SPX Tests 5783 Resistance; Ideal Time to Shift to Defensives
- $SPX remains below 5783, the upper-end of important target/resistance area we’ve discussed for a month+ (5670-5783). 5670 was prior all-time high set in July, while 5783 is 2% above 5670.
- It’s hard to call it a “decisive” breakout if SPX isn’t even 2% above its prior high. In 2007, SPX made a top after climbing 1-2% above its prior high.
- The 2007 topping analog has tracked the current market almost perfectly, with similar backdrops to today including new Fed cutting cycle, recession indicators going off, yield curve un-inverting, defensives outperforming
KULR Technology Group Inc.
- KULR Technology Group, Inc. develops and commercializes high-performance thermal management technologies for electronics, batteries, and other components across a range of applications.
- Currently, it is focused on high performance aerospace and Department of Defense applications, such as space exploration, satellite communications, and underwater vehicles, and applying them to mass market commercial applications, such as lithium-ion battery energy storage, electric vehicles, 5G, cloud computer infrastructure, consumer and industrial devices.
- It is also applying its zero-vibration technology to fans in commercial markets which could be a large revenue opportunity.
KULR Technology Group Inc.
- KULR Technology Group, Inc. develops and commercializes high-performance thermal management technologies for electronics, batteries, and other components across a range of applications.
- Currently, it is focused on high performance aerospace and Department of Defense applications, such as space exploration, satellite communications, and underwater vehicles, and applying them to mass market commercial applications, such as lithium-ion battery energy storage, electric vehicles, 5G, cloud computer infrastructure, consumer and industrial devices.
- It is also applying its zero-vibration technology to fans in commercial markets which could be a large revenue opportunity.
Daiseki Co Ltd (9793 JP): 1H FY02/25 flash update
- Consolidated 1H sales decreased by 8.3% YoY to JPY32.8bn, meeting the company’s target of JPY32.7bn.
- Consolidated operating profit for 1H decreased by 5.5% YoY to JPY7.3bn, exceeding the target of JPY6.7bn.
- Net income attributable to owners of the parent increased by 2.1% YoY to JPY4.9bn, surpassing company forecasts.
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