In today’s briefing:
- Shin-Etsu Chem TOB for Rest of Mimasu Semi (8155) – Far Too Cheap, But No Squeaky Wheel No Grease
- Sensetime Placement – Seems Highly Opportunistic
- Mimasu Semiconductor (8155 JP): Shin-Etsu (4063 JP)’s Tender Offer Launches
- PC Partners (1263 HK) Muses SGX Listing & HKEx Withdrawal
- TechChain Insights: Call with Elan Micro; AI PC Significant Uptake 4Q24/1H25; Supply Chain Preparing
- MIXI Inc. (2121 JP) – At an Inflection Point to Generate Shareholder Value
- Tech Supply Chain Tracker (21-Jun-2024): TYC Brother Industrial excels in NEVs; US plant ready by 1Q25.
- Perfect Corp.
Shin-Etsu Chem TOB for Rest of Mimasu Semi (8155) – Far Too Cheap, But No Squeaky Wheel No Grease
- Shin Etsu Chemical (4063 JP), owner of a 44% stake in Mimasu Semiconductor Industry (8155 JP), will launch the TOB to buy out Mimasu minority holders, as pre-announced 2mos ago.
- Not surprising. They bought in 19yrs ago, raised to 40+% 18yrs ago, then waited. Finally, we have a deal. It’s too cheap but in 18yrs, I recall zero activism here.
- Shin-Etsu starts with ~45%, and crossholders and the chairman get it to 53%. Then they need a bit to get them to 67% but it should be straightforward.
Sensetime Placement – Seems Highly Opportunistic
- SenseTime Group (20 HK) aims to raise up to US$263m via selling around 4.5% stake.
- Sensetime hasn’t had the best of times since listing, however, the shares have rebounded recently on generative AI buzz around the stock.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Mimasu Semiconductor (8155 JP): Shin-Etsu (4063 JP)’s Tender Offer Launches
- Mimasu Semiconductor Industry (8155 JP) notes that the pre-condition for Shin Etsu Chemical (4063 JP)’s JPY3,700 tender offer has been satisfied. The tender runs from 21 June to 5 August.
- The share price has traded at or above the offer on 15 out of 38 trading days, partly due to expectations of a counteroffer.
- While the offer is below the midpoint of the IFA DCF valuation range, it represents an all-time high. The lack of activists or competing offers suggests a done deal.
PC Partners (1263 HK) Muses SGX Listing & HKEx Withdrawal
- On the 18th June, personal computer (PC) parts and accessories play PC Partner (1263 HK) announced a profit alert for 1H24.
- That’s positive. What is also interesting is that the board is considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
- Precedents are thin on the ground. And for good reason. The process is not straightforward.
TechChain Insights: Call with Elan Micro; AI PC Significant Uptake 4Q24/1H25; Supply Chain Preparing
- We hosted a conference call with Elan Microelectronics management; We view the company as a Structural Long position for the AI PC upgrade cycle.
- From the company’s perspective, significant impact from AI PC demand will come but not until 4Q24E or 1H25E. However, supply chain excess inventory improved and prepping for upcycle.
- An estimated 90% of AI PC models launched at CES 2024 use Elan’s products in their design; Elan well positioned for the upcycle and entrenching its position. Maintain Structural Long.
MIXI Inc. (2121 JP) – At an Inflection Point to Generate Shareholder Value
- Approaching a transformational phase – MIXI Inc. is a digital content company generating earnings from its ‘MONSTER STRIKE’ mobile gaming franchise.
- Operating in a mature domestic gaming market, the company has successfully diversified into lifestyle and sports, but to date has experienced limited earnings contribution.
- We believe this is about to change, driven by the new monetization strategy for the ‘FamilyAlbum’ video and photo- sharing service app in FY3/25.
Tech Supply Chain Tracker (21-Jun-2024): TYC Brother Industrial excels in NEVs; US plant ready by 1Q25.
- TYC Brother Industrial is set to dominate the NEV market with a US plant scheduled to be operational by the first quarter of 2025.
- Despite sanctions, a Russian company has introduced the MP21 SBC to rival the Raspberry Pi 5, showcasing the competitiveness of the technology market.
- Cerebras and Dell have joined forces to challenge Nvidia in the AI market, highlighting the growth of AI accelerator technology for servers. Taiwan’s carbon market is advancing with new initiatives and regulations, while the UK collaborates with Taiwan to lead in semiconductors at Semi-Impact forum. India is ramping up cobalt supply efforts to meet growing demand.
Perfect Corp.
- Perfect Corp. provides an AI and machine learning based B2B SaaS platform for virtual try on and marketing of beauty and fashion products as well as six mobile apps sold B2C for makeup suggestions, try-on, tutorials, photo and video editing and most recently, Gen AI creation and editing.
- It is expanding its offering to new verticals and has strong IP as well as the largest database for AI training in the industry.
- It has a dominant market share and serves almost all the major beauty brands worldwide.
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