In today’s briefing:
- GUPPY’s (5127 JP): Medley (4480 JP) Tender Offer at JPY3,250
- Activia Properties (3279) – Short-Term Higher-Impact Buyback on Better Fundamental Results
- IBJ (6071) – Aiming to Solidify Its Dominant Market Position
- Weekly Deals Digest (21 Jan) – Benefit One, GUPPY’s, T&K Toka, Weiqiao, Genetron, Amer Sports
- Allegro MicroSystems: Initiation of Coverage – How Its Strategic Focus is Electrifying the Future of Transportation – Major Drivers
- Last Week in Event SPACE: Benefit One, China Unicom, Zhejiang Expressway/ Zheshang Sec, Hollysys
GUPPY’s (5127 JP): Medley (4480 JP) Tender Offer at JPY3,250
- GUPPY’s Inc (5127 JP) has recommended Medley (4480 JP)’s tender offer of JPY3,250 per share, an 81.0% premium to the undisturbed price (19 January).
- The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the tender offer is set at a 10.19% ownership ratio.
- Despite the premium, the offer is light vs the IFA DCF valuation. Based on the irrevocables, the minimum acceptance condition requires a 23.4% minority acceptance rate, which is achievable.
Activia Properties (3279) – Short-Term Higher-Impact Buyback on Better Fundamental Results
- Activia Properties (3279 JP) announced results Wednesday. Higher DPU on better rental income looks to continue next period, but an asset disposal will produce some drag ahead.
- Activia Properties also announced a buyback of 10% of ADV for the next four months.
- The REIT is slightly cheap to peers. Yield spread to JGBs is high which is good. It needs to be 10% higher to restart accretive equity offerings.
IBJ (6071) – Aiming to Solidify Its Dominant Market Position
- Market leader positioning to consolidate – IBJ is a marriage consultancy service with strong brand equity, offering high-quality services delivered by human professionals.
- With an industry-leading membership base, affiliated marriage consulting firms within the IBJ network harness the economies of scale through the platform, ensuring a cost-effective approach to service delivery.
- It has a strong track record of sustainable free cash flow generation.
Weekly Deals Digest (21 Jan) – Benefit One, GUPPY’s, T&K Toka, Weiqiao, Genetron, Amer Sports
- 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 – Amer Sports (AS US), Ola Electric (1700674D IN) and Mixue Group (MIX HK) IPOs.
- Event-Driven developments – Benefit One Inc (2412 JP), GUPPY’s Inc (5127 JP), T&K Toka Co Ltd (4636 JP), Weiqiao Textile Co (2698 HK), Genetron Holdings Ltd (GTH US).
Allegro MicroSystems: Initiation of Coverage – How Its Strategic Focus is Electrifying the Future of Transportation – Major Drivers
- This is our first report on sensor technology player, Allegro MicroSystems.
- Sales in these strategic growth areas made up 56% of total sales, indicating a successful strategy execution focused on these specific sectors.
- The company’s automotive revenues grew 31% year-over-year, with the electrification of vehicles and Advanced Driver Assistance Systems adoption being the main growth drivers.
Last Week in Event SPACE: Benefit One, China Unicom, Zhejiang Expressway/ Zheshang Sec, Hollysys
- Dai Ichi Life (8750 JP) has the wherewithal, and probably the synergies to make a bump for Benefit One (2412 JP) work. M3 is clearly not in the driver’s seat.
- China United Network (600050 CH) is, for all intent and purpose, a pseudo-A to China Unicom (762 HK). Go long Unicom, short United due to Unicom’s significantly cheaper valuation.
- Zhejiang Expressway (576 HK) has had a stonking run since its rights issue. Look to unwind this set-up and take the other side: short Expressway, long Zheshang Securities (601878 CH).
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