In today’s briefing:
- Nidec Goes Hostile On Makino Milling at ¥11,000/Share
- Makino Milling Machine (6135 JP): Nidec’s (6594 JP) Hostile Preconditional Tender Offer at JPY11,000
- Nippon Shinyaku (4516 JP): Unfavorable Patent Verdict; Company Vows to Fight Back
- Nidec (6594 JP): Acquisition of Makino Milling Would Add Value
Nidec Goes Hostile On Makino Milling at ¥11,000/Share
- This morning, Nidec Corp (6594 JP)announced that it intended to launch a Tender Offer on Makino Milling Machine Co (6135 JP) without the support of Makino management.
- The same pattern as Takisawa Machine Tool (6121 JP). Nidec decides, relying on the METI Guidelines for Corporate Takeovers for procedure, announces, and puts the onus on the Target to accept.
- But shareholders should hope Makino Milling takes a page from the example provided by Chilled & Frozen Logistics Holdings (9099 JP) back in spring 2024. This could get funky.
Makino Milling Machine (6135 JP): Nidec’s (6594 JP) Hostile Preconditional Tender Offer at JPY11,000
- Nidec Corp (6594 JP) announced a hostile preconditional tender offer for Makino Milling Machine Co (6135 JP) at JPY11,000 per share, an 18.9% premium to the last close.
- The offer is preconditioned on several regulatory approvals. It is scheduled to start on 4 April, even if the Board does not recommend it.
- The Board has three options: engage to facilitate a friendly offer, find a white knight bidder and launch an ambitious MTM plan to thwart the offer.
Nippon Shinyaku (4516 JP): Unfavorable Patent Verdict; Company Vows to Fight Back
- A US court found Nippon Shinyaku (4516 JP) guilty of patent infringement related to competitor Sarepta Therapeutics (SRPT US)‘s DMD drug Vyondys 53 and asked to pay $115M as compensation.
- The jury verdict will have no bearing on Viltepso sales. Nippon Shinyaku disagreed with the verdict, and is considering all options including post jury motions and appeals.
- An additional expense to the tune of $115M would surely be a huge drag on the profitability of the company which is already under pressure because of rising costs.
Nidec (6594 JP): Acquisition of Makino Milling Would Add Value
- Nidec has announced its intention to acquire Makino Milling Machine (6135 JP) for ¥11,000 per share, a 42% premium over Thursday’s closing price.
- The stock market liked the idea. Nidec’s share price rose 4% on Friday. Makino’s jumped 19%. The pice looks high, but at 17.7x Makino’s EPS guidance, it is not unreasonable.
- The acquisition would be accretive to earnings and bring greater scale and competitiveness to Nidec’s machine tool business. It should support our Buy recommendation.
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