In today’s briefing:
- Toshiba (6502) – Now We Have the First Rounds Bids In, And We Wait, But It’s Top of Range
- Toshiba – Key Takeaway Is Toshiba Tec’s Attractiveness
- SPH REIT Offer Goes Unconditional – The Option Now and Index Impacts To Come
- FTSE EPRA Nareit Asia – June 2022 Rebalance – BIG Impact on BIG Names
- StubWorld: Genting’s TauRx Boost. Also Hanhwa Solutions, Semirara Mining
- FTSE100/FTSE250 Index Rebalance: +/-2 for FTSE100; +/-7 for FTSE250
- Xiamen Port’s Juicy HK$2.25 Per H Share Privatisation Offer
- GoTo Index Inclusion: Fast Entry to IDX30, LQ45, IDX80 Confirmed; BIG Buying Next Week
- FTSE TWSE Taiwan 50 Index Rebalance: PSMC (6770) Replaces Momo (8454)
- FTSE UK: June 2022 Rebalance: Bank of Georgia and Oxford Biomedica Are Interesting
Toshiba (6502) – Now We Have the First Rounds Bids In, And We Wait, But It’s Top of Range
- Since Toshiba reported lacklustre earnings and guidance, there has been a steady flow of articles in the press about the privatisation process going on behind the scenes.
- On 25 March, Toshiba let it be known a privatisation process would start. On 31 March, Bain gave notice it would participate. Toshiba has been in talks since 21 April
- First round bids were due 30 May, and 10 total submissions were made, with 8 privatisation proposals proffered. Now we wait…
Toshiba – Key Takeaway Is Toshiba Tec’s Attractiveness
- Toshiba provided an update today on its management policy and the status of discussions with potential investors.
- The management targets unveiled looked plausible but rather optimistic while the only real new information on the potential privatisation was that 8 bids had been submitted.
- In the end the most interesting takeaway for us was that Toshiba Tec would play a key role in Toshiba’s data business.
SPH REIT Offer Goes Unconditional – The Option Now and Index Impacts To Come
- Yesterday, it appears that a large holder of SPH REIT (SPHREIT SP) accepted the Cuscaden Chain Offer for the REIT.
- This morning just after midnight, the Cuscaden consortium announced that the Chain Offer had become Unconditional.
- This makes the 4-week option unconditional, and it means index impacts to come.
FTSE EPRA Nareit Asia – June 2022 Rebalance – BIG Impact on BIG Names
- FTSE Russell announced a total of 6 adds and 6 deletes in the FTSE EPRA Nareit Developed Market Series, with the largest number of changes in Asia.
- Samty Residential Investment (3459 JP) and LOTTE Reit Co Ltd (330590 KS) are added; Henderson Land Development (12 HK), Hang Lung Properties (101 HK), and New World Development (17 HK) deleted.
- The impact on all the names is large. This is worth looking at.
StubWorld: Genting’s TauRx Boost. Also Hanhwa Solutions, Semirara Mining
- Genting Bhd (GENT MK) gains 10.3% following the completion of TauRx’s Alzheimer’s drug trial. That’s an RM1.9bn lift in its market cap, or US$0.43bn.
- Preceding my comments on Genting, Hanwha Solutions (009830 KS), and Semirara Mining And Power Corp (SCC PM) are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
FTSE100/FTSE250 Index Rebalance: +/-2 for FTSE100; +/-7 for FTSE250
- Centrica PLC (CNA LN) and Unite Group (UTG LN) will replace ITV PLC (ITV LN) and Royal Mail PLC (RMG LN) in the UKX Index at the close on 17June.
- There are 7 changes for the FTSE 250 Index and the impact of passive trading on the stocks varies from 2-11 days of ADV.
- All the changes were expected. The stocks with inflows have outperformed the stocks with outflows over multiple time periods and there will be pre-positions on the stocks.
Xiamen Port’s Juicy HK$2.25 Per H Share Privatisation Offer
- Xiamen International Port H (3378 HK) announced a pre-conditional privatisation offer from Xiamen Port Holding at HK$2.25 per H share + final dividend of RMB0.021 per share (ex-div: 15 June).
- The key conditions are approval by at least 75% of independent H Shareholders (<10% of all independent H Shareholders’ rejection). There is no minimum acceptance condition.
- The offer is attractive in comparison to historical share prices and multiples. We think that the privatisation proposal will likely succeed. At the last close, the gross spread is 55.2%.
GoTo Index Inclusion: Fast Entry to IDX30, LQ45, IDX80 Confirmed; BIG Buying Next Week
- The IDX has announced that GoTo (GOTO IJ) will be included in the IDX30, LQ45 and IDX80 indices at a float of 66.4% at the close on 7 June.
- Waskita Karya (Persero) (WSKT IJ) will be deleted from the IDX30 and LQ45 indices, while Buyung Poetra Sembada PT (HOKI IJ) will be deleted from the IDX80 index.
- Passive trackers need to buy around 12.78% of the real float on GoTo (GOTO IJ). Add the impact from open ended funds and that could move up to 20%.
FTSE TWSE Taiwan 50 Index Rebalance: PSMC (6770) Replaces Momo (8454)
- Powerchip Semiconductor Manufacturing Corp (6770 TT) will replace Momo.Com Inc (8454 TT) in the FTSE TWSE Taiwan 50 index at the close of trading on 17 June.
- Passive trackers will need to buy 0.7 days of ADV on Powerchip Semiconductor Manufacturing Corp (6770 TT) and sell 0.65 days of ADV on Momo.Com Inc (8454 TT).
- There is over 3 days ADV of short interest on Powerchip Semiconductor Manufacturing Corp (6770 TT) and 2.5 days ADV of shorts on Momo.Com Inc (8454 TT).
FTSE UK: June 2022 Rebalance: Bank of Georgia and Oxford Biomedica Are Interesting
- The index changes for the FTSE UK Indices for the June 2022 Rebalance were announced yesterday. There will be 2 changes for FTSE 100 and 7 changes for FTSE 250.
- The changes are the same as specified in my discussion point (link) yesterday.
- Below is a closer look at the Inclusion Parameters and price performance of the names involved in this Rebalance Event.
Before it’s here, it’s on Smartkarma
