In today’s briefing:
- WealthNavi (7342 JP): MUFG (8306 JP)’s Opportunistic Tender Offer
- MUFG Launches a TOB to Take Out Robo-Advisor WealthNavi (7342) – The 81.4% Premium Is Light
- Last Week in Event SPACE: Keisei Electric Railway, Vitasoy, NEC Network, ESR Group
- Mostly) Asia-Pac M&A: SG Fleet, Shandong Hi-Speed New Energy, HPI, Capitol Health, Henlius, 7 & I
- Weekly Deals Digest (01 Dec) – Seven & I, WealthNavi, ESR, SDHS New Energy, Vitasoy, Kioxia, Hulic
- The Issue of Tenure Is Also Similar to the Issue of Concurrent Directorships
WealthNavi (7342 JP): MUFG (8306 JP)’s Opportunistic Tender Offer
- In response to a Nikkei article, WealthNavi (7342 JP) disclosed Mitsubishi UFJ Financial (MUFG) (8306 JP)’s tender offer at JPY1,950 per share, an 84.3% premium to the undisturbed price.
- The high premium reflects WealthNavi’s steep 46% YTD share price decline, i.e., the timing is opportunistic. The offer is below the Board’s requested price.
- While the irrevocable has a competing offer clause, a competing proposal is unlikely due to MUFG’s stake. However, a bump is possible if activist(s) take around a 15% stake.
MUFG Launches a TOB to Take Out Robo-Advisor WealthNavi (7342) – The 81.4% Premium Is Light
- MUFG (8306) bought 15.5% of WealthNavi (7342 JP) in February at ¥1,718/share – zero premium. The shares fell. Now they are bidding for the rest 13.5% higher.
- WealthNavi forecasts fantastic growth. Dec29 OP is specifically estimated at ¥13.822bn. Everyone agrees there are synergies, but they’re not “valued” because they “cannot be specifically estimated at this moment.”
- I believe investors should start demanding Synergy CVRs of acquirors when synergies are not included in the fair value calculations.
Last Week in Event SPACE: Keisei Electric Railway, Vitasoy, NEC Network, ESR Group
- Remain BULLISH Keisei Electric Railway Co (9009 JP) with low conviction. This is buying on narrative rather than fundamentals but there is no need to not get involved.
- Vitasoy Intl Holdings (345 HK)‘s share price run up is excessive as Philip Ng andYeo Hiap Seng (YHS SP) over-extend their hand.
- Nec Networks (1973 JP) has yet to trade below terms. The premium is small, perhaps reflecting the risk NEC will lower the minimum threshold. But there is still a fight here.
Mostly) Asia-Pac M&A: SG Fleet, Shandong Hi-Speed New Energy, HPI, Capitol Health, Henlius, 7 & I
- I tally 48 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Three new deals this week: NBIOs for SG Fleet (SGF AU) and AVJennings Ltd (AVJ AU); and Shandong Hi-Speed New Energy (1250 HK)‘s MGO. Fosun Tourism (1992 HK) also suspended.
- Key updates/news took place on: Hotel Property Investments (HPI AU), Capitol Health (CAJ AU), Shanghai Henlius Biotech (2696 HK), Seven & I Holdings (3382 JP) and SAMTY HOLDINGS (187A JP).
Weekly Deals Digest (01 Dec) – Seven & I, WealthNavi, ESR, SDHS New Energy, Vitasoy, Kioxia, Hulic
- 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: Kioxia Holdings (285A JP) and FineToday Holdings Co Ltd (289A JP) IPOs, Hulic Co Ltd (3003 JP) and Sanrio (8136 JP) placements.
- Event-Driven developments: Seven & I Holdings (3382 JP), WealthNavi (7342 JP), ESR Group (1821 HK), Shandong Hi-Speed New Energy G (1250 HK), Vitasoy Intl Holdings (345 HK).
The Issue of Tenure Is Also Similar to the Issue of Concurrent Directorships
- While female directors and nominating/compensation committee, for which TSE has specified specific goals, have made progress, foreign directors, for whom no specific goals have been set, have lagged behind.
- Even now, with over 40% of companies with P/Bs below 1x and ROE not exceeding the cost of capital, not many companies moved to value-creating management with functioning corporate governance.
- Nominating committee should make its selection, including whether to replace the incumbent director with another candidate. If it fails to do so, it’s not fulfilling its responsibilities as nominating committee.
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