In today’s briefing:
- Silverlake Axis (SILV SP): Voluntary Unconditional Offer
- Shinko Electric (6967) Deal Approval Delayed; From Here, Big Gap-, Small Break-, Some Delay-Risk
- Shinko Electric (6967 JP): Tender Start Timelines Delayed
- Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: Nuvoton Could Drop Some More
- HK Connect SOUTHBOUND Flows (To 23 Aug 2024); Net Breaks the 28-Week Buying Streak on ETF Selling
- Quiddity Leaderboard T50/100 Sep 24: Nuvoton Tech TDIV DEL Likely; Shin Kong M&A Consequences
- Taiwan Tech Weekly: Nvidia Results Imminent; Apple IPhone 16 Reveal Date; Micron’s Taiwan Expansion
- Taiwan Top 50 ETF Rebalance Preview: One Change Expected in Sep
- Kioxia IPO Early Re-Look – Better Placed This Time Around
- Intel Missed the Party, while AMD’s ZT Systems is the Bet to Stay in the Game
Silverlake Axis (SILV SP): Voluntary Unconditional Offer
- Silverlake Axis (SILV SP) has disclosed a voluntary unconditional offer from the Goh family and Ikhlas Capital. The default cash consideration is S$0.36, a 20.0% premium to the undisturbed price.
- The combi consideration is S$0.30 in cash and one new redeemable preference share (RPS) in the offeror, which will be mandatorily redeemed after five calendar years at S$0.18 per RPS.
- While not declared final, the offer is reasonable but not a knockout bid. The offeror is likely to use the voluntary delisting method to privatise Silverlake.
Shinko Electric (6967) Deal Approval Delayed; From Here, Big Gap-, Small Break-, Some Delay-Risk
- Today after the close, Shinko Electric Industries (6967 JP) offered a progress report on the approvals for the JIC Consortium Tender Offer originally “scheduled” to start in late August 2024.
- “Procedures and Steps Necessary under the competition laws of Vietnam and China have not been completed” so the Tender Offeror expects to commence the Tender Offer in/after late January 2025.
- The announcement appears to suggest no update is likely for another five months or until the Tender Offer starts. That will introduce questions of further delay.
Shinko Electric (6967 JP): Tender Start Timelines Delayed
- Shinko Electric Industries (6967 JP) pre-conditional tender offer from the JIC alliance is JPY5,920 per share. The tender start has been delayed from late August to around late January 2025.
- The delay was due to outstanding China SAMR and Vietnam regulatory approvals. The stretched timeline suggests that SAMR will likely conditionally approve the deal.
- While Ibiden Co Ltd (4062 JP)’s underperformance lowers the deal’s break price, timing, not break risk, remains the key concern. At the last close, the gross/annualised spread was 3.7%/7.5%.
Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: Nuvoton Could Drop Some More
- With the review period complete, Nuvoton Technology (4919 TT) is a near certain deletion from the Yuanta/P-Shares Taiwan Dividend Plus ETF in September.
- Passive trackers will need to sell 20m shares in Nuvoton Technology (4919 TT). That is over 10% of float and the stock could continue to remain under pressure.
- The potential deletion still appears to be under positioned. There could be renewed selling in the stock over the next few weeks.
HK Connect SOUTHBOUND Flows (To 23 Aug 2024); Net Breaks the 28-Week Buying Streak on ETF Selling
- SOUTHBOUND was a net seller this past week for HK$1.5bn, the first week in 29 where SB was a net seller. It was all ETFs. Stocks were a net buy.
- Gross volumes remain very low. Net volumes de minimis. Very August-ish. No sectors stood out.
- The largest net buy was CSPC Pharmaceutical Group (1093 HK) where the net buying was the same size as the fifth largest net sell (Tencent (700 HK))
Quiddity Leaderboard T50/100 Sep 24: Nuvoton Tech TDIV DEL Likely; Shin Kong M&A Consequences
- The T50 index represents the top 50 largest stocks by market capitalization in the Taiwan Stock Exchange (TWSE). The T100 index represents the next 100 largest names (51-150 ranks).
- Today is the base date for the September 2024 index rebal event and the expected ADDs/DELs discussed in this insight are our final index change expectations.
- Separately, we also have a look at the T50/100 index implications of the Shin Kong Financial Holding (2888 TT) – Taishin Financial Holding (2887 TT) merger situation.
Taiwan Tech Weekly: Nvidia Results Imminent; Apple IPhone 16 Reveal Date; Micron’s Taiwan Expansion
- Nvidia, Dell, Marvell results coming out this week.. Apple iPhone 16 Reveal September 9th?
- Micron progressing on potential Taiwan capacity expansion due to strong HBM DRAM demand
- AMD acquires a key U.S. server systems integrator, expanding its enterprise server opportunity in a market including Taiwan’s server ODM players such as Hon Hai, Wiwynn, Inventec, Quanta, and Compal.
Taiwan Top 50 ETF Rebalance Preview: One Change Expected in Sep
- Pharmaessentia Corp (6446 TT) could replace Nanya Technology (2408 TT) in the Taiwan Top 50 ETF in September. Airtac International (1590 TT) has possibly just avoided deletion.
- Short interest has been dropping in Pharmaessentia Corp (6446 TT) as the stock has rallied, while cumulative excess volume has continued to increase steadily.
- Shorts have increased in Nanya Technology (2408 TT) as the stock price dropped. There has been no increase in volume on the recent upmove indicating a possibility of further downside.
Kioxia IPO Early Re-Look – Better Placed This Time Around
- Kioxia Holdings (6600 JP) aims to list in Japan by Oct 2024 at a valuation of over US$10bn, as per media reports.
- Kioxia is a manufacturer and a global leader in flash memory and solid state drives for smartphones, PCs, enterprise servers and data centers
- In this note, we take an early look at the possible listing.
Intel Missed the Party, while AMD’s ZT Systems is the Bet to Stay in the Game
- First, let’s start with Intel. Intel had a pretty poor earnings result. There’s no two ways about it.
- Intel reports Q2 EPS $0.02 ex-items vs FactSet $0.10, announces $10B cost reduction plan; suspends dividend
- There was another layoff of around 15% of employees, a full dividend suspension (finally, guys), and a capex cut.
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