In today’s briefing:
- Kanematsu Electronics (8096 JP): JPY6,200 Tender Offer from Kanematsu Corporation
- Index Rebalance & ETF Flow Recap: NKY, LQ45, New Deal, URA, NIFTY, Stock Connect, SenseTime, Adani
- Kanematsu Electronics (8096) – ¥6200/Share Tender Offer by Parent – Easy Takeout
- ECM Weekly (29th Jan 2023) – Adani, Oasis, Mankind Pharma, ZJLD, India IPO Bookrunners
- Tyro Payments (TYR AU): Bid Revived as Potentia Secures Due Diligence
- MongoDB Inc: Major Drivers, Financial Forecasts, DCF & Comparables Valuation, Key Risks (01/23)
- Jabil Inc: Major Drivers
- Dropbox Inc: The FormSwift Acquisition & Other Drivers
- Accenture plc: Acquisition of FiftyFive5 & Other Drivers
Kanematsu Electronics (8096 JP): JPY6,200 Tender Offer from Kanematsu Corporation
- Kanematsu Electronics (8096 JP) has recommended Kanematsu Corp (8020 JP)’s tender offer of JPY6,200 per share, an 32.9% premium to the undisturbed price (27 January).
- The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the offer has been set to meet the 66.67% ownership ratio.
- The tender offer is attractive as it represents an all-time share price high and a premium to peer multiples. This suggests a done deal.
Index Rebalance & ETF Flow Recap: NKY, LQ45, New Deal, URA, NIFTY, Stock Connect, SenseTime, Adani
- The review period for the upcoming rebalance of the MSCI, Nikkei 225, NIFTY, Nifty Next 50, SSE STAR50 and KRX New Deal Indices ends on 31 January.
- The IDX30, LQ45, IDX80, Global X Uranium ETF (URA US) rebalances will be implemented on 31 January while the PSEi Index (PCOMP INDEX) rebalance will be implemented on 3 February.
- There were inflows to Asian country ETFs and iShares MSCI Emerging Markets (EEM), and outflows from IShares MSCI Min Vol EM ETF (EEMV) and iShares MSCI Pacific ex Japan (EPP).
Kanematsu Electronics (8096) – ¥6200/Share Tender Offer by Parent – Easy Takeout
- Kanematsu Corp (8020 JP) announced two tender offers Friday to take out subsidiaries. One more liquid one. One very small sub. This is the larger, easier deal.
- Kanematsu Electronics is an IT shop, designing and executing system integration and maintenance services. It is a great business. The takeout is a 33% premium to an all-time high.
- It might still be a bit cheap, but it is not egregious, and it would be quite difficult to block.
ECM Weekly (29th Jan 2023) – Adani, Oasis, Mankind Pharma, ZJLD, India IPO Bookrunners
- Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
- While the holiday shortened week didn’t see much action in Asia, but there was one more ADR filing in the US, adding to the mini-pipeline.
- Adani’s ongoing FPO was the only live deal this week, although it had enough drama to make up for the lack of other deals.
Tyro Payments (TYR AU): Bid Revived as Potentia Secures Due Diligence
- Tyro Payments (TYR AU) has offered, Potentia, four weeks of due diligence access to “develop a significantly improved proposal.” The Board rejected Potentia’s previous A$1.60 offer on 12 December.
- Since the rejection of the offer, the FY2023 guidance has been upgraded and peers have re-rated. Therefore, Potentia can afford to be more generous with its terms.
- Press reports suggest that an offer of around A$1.85 per share would be supported by shareholders. We would be buyers as Tyro is undervalued at the last close price.
MongoDB Inc: Major Drivers, Financial Forecasts, DCF & Comparables Valuation, Key Risks (01/23)
- MongoDB performed well in the third quarter in both financial and operational terms.
- In addition, ISVs are continuing to develop their solutions using MongoDB in an increasing number of cases.
- MongoDB is looking to achieve profitable growth and focus on acquiring new workloads from both existing and new customers.
Jabil Inc: Major Drivers
- Jabil’s Q1 performance was impressive and the company delivered an all-around beat which helped propel its stock price.
- The company’s strength resulted in the quarter’s double-digit rise in revenue, core operating income, and core diluted profits per share.
- Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.
Dropbox Inc: The FormSwift Acquisition & Other Drivers
- Despite a series of macroeconomic challenges, Dropbox had a good last quarter and managed an all-around beat.
- They also continue to return a sizable percentage of their free cash flow to shareholders through share repurchases.
- Although they are experiencing moderate growth in their Sign business, it is important to set Dropbox Sign apart from conventional eSign solutions.
Accenture plc: Acquisition of FiftyFive5 & Other Drivers
- Accenture continued its acquisition-led growth strategy in the last quarter and delivered another all-around beat, increasing operating margin while making significant investments in related businesses.
- Engineering and industrial digitization are still in high demand and experienced strong double-digit growth in Q1.
- Furthermore, they are assisting Celanese to undergo a digital transformation that will boost their manufacturing production resilience, productivity, and plant operations predictability.
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