In today’s briefing:
- Itochu TOB on Itochu Techno Solutions – The Index Selldown Schedule for $700mm+ of Flows
- Naspers (NPN) & Prosus (PRX): Initial Market Reaction to Leadership Changes
- Softbank (9984 JP): Arm IPO Done, the Hard Part Comes Next
- Deutsche Boerse Gets >90% of SimCorp
- UMC (2303.TT; UMC.US): The Revenue Can Be Downward a Bit in 4Q23F.
- Chip Designer Arm Committed to China, CEO Says
- 4Paradigm IPO: Forecasts and Valuation
- Gene Solutions Raises $21m Series B, Targeting Regional Expansion
- kopi-C with StarHub’s CEO: “There’s no other telco like ours”
Itochu TOB on Itochu Techno Solutions – The Index Selldown Schedule for $700mm+ of Flows
- In August, Itochu Corp (8001 JP) launched a Tender offer on Itochu Techno Solutions (4739 JP) to buy out minorities.
- That tender offer ended last week, with Itochu and the acquirer vehicle owning 85+%.
- Interestingly, there are near-term flow events as a result. Worth watching.
Naspers (NPN) & Prosus (PRX): Initial Market Reaction to Leadership Changes
- Early on Monday morning, Naspers and Prosus announced the immediate resignation of CEO Bob van Dijk. Management hosted an investor call shortly after. Key takeaways are included below.
- Ervin Tu, Group Chief Investment Officer, will take over as Interim CEO. Tu is a strong candidate for the permanent position.
- After an initial bounce at the open, both counters sold off, widening the discounts by more than 1 percentage point intra-day.
Softbank (9984 JP): Arm IPO Done, the Hard Part Comes Next
- Softbank’s successful Arm Holdings IPO is a relief for Masa, with Arm valued at USD57bn and Arm shares trading above the issue price; this supports the SoftBank share price
- Arm’s key challenge is delivering on the growth strategy to justify its super-premium valuation; Arm’s historic price to sales is at a big premium to its peer group, excluding Nvida
- On current market values including Arm, Softbank shares trade at a 52% NAV discount; however, Arm’s current valuation seems unsustainable to us, threatening to erode the near term NAV lift
Deutsche Boerse Gets >90% of SimCorp
- Deutsche Boerse (DB1 GR) offered a (full) price of DKK 735/share for SimCorp A/S (SIM DC) to grow in data & analytics. I recommend long. Acceptances total roughly 93.65% of share capital.
- All conditions and approvals, including minimum acceptance of 50%+1 share have been fulfilled. Final results should be announced on 22 September and settlement should take place on 29 September.
- Deutsche Börse will as soon as possible seek to initiate and complete a compulsory acquisition. After a recent dip, the shares trade again at the offer price.
UMC (2303.TT; UMC.US): The Revenue Can Be Downward a Bit in 4Q23F.
- The upcoming demand is expected to reduce in 4Q23F, with the most obvious decline in 40nm and 8″ demand.
- Wafer ASP is expected to remain relatively stable until 4Q22F, even though revenue is not anticipated to pick up in 1H24F.
- We expect the market to reach its lowest point in the first half of 2024F. The most likely scenario indicates a potential recovery around the third quarter of 2024F.
Chip Designer Arm Committed to China, CEO Says
British chip designer Arm Holdings Plc remains committed to China and to working closely with its mainland-based partner following its $4.87 billion IPO, according to chief executive Rene Haas.
The Softbank-backed firm floated in New York last week via the world’s largest public offering year-to-date. But that has not affected its strategy globally.
- Shanghai-headquartered Arm Technology (China) Co. Ltd., also known as Arm China, operates independently and is the exclusive licensing platform of Arm’s global intellectual property in China
4Paradigm IPO: Forecasts and Valuation
- 4Paradigm has announced the terms for its IPO. The company plans to raise gross proceeds of $131-144m through issuing 18.4m shares at an indicative price range of HK$55.6-61.16 per shares.
- The company’s IPO is timed perfectly when AI adoption is expected to expand on a large scale with the popularity of ChatGPT and other AI applications.
- Though we liked 4Paradigm (1764934D HK) for its improving financials and growth prospects, our analysis suggests that the IPO is expensive.
Gene Solutions Raises $21m Series B, Targeting Regional Expansion
Gene Solutions, which bills itself as Vietnam’s largest genetic testing company, has raised US$21 million in a series B round.
This follows a US$15 million investment that the private equity investor made in the company in 2021.
Gene Solutions is one of Mekong Capital’s recent bets in biotech, a sector that has been arguably underserved by venture capital firms in Vietnam.
kopi-C with StarHub’s CEO: “There’s no other telco like ours”
- Kopi-C with StarHub’s CEO: “There’s no other telco like ours” StarHub’s CEO Nikhil Eapen shares how reinvention and diversification can help firms to retain and attract more customers for long-term growth After nearly a year at the helm, Eapen launched StarHub’s new DARE+ initiative in late 2021, a visionary plan to offer new products and services to connect customers’ digital lives.
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