In today’s briefing:
- Toshiba (6502) – Iffy Earnings, Worse Projections, A Special Div, But Privatisation Process Proceeds
- HUGE Wacoal (3591) Buyback – Buyback Structure Unknown But Interesting Possibilities Exist
- Sakata Inx (4633) HUGE Buyback Makes Things Interesting
- Index Rebalance & ETF Flow Recap: MSCI STD/SC, FTSE AW/AC, EPRA, MVIS, TW50, Mindtree/L&T, AMFI
- Infomedia (IFM AU): TA Associates/Viburnum Funds Proposal
- Hitachi Maxell (6810 JP) – Very Big On-Market Buyback
- Last Week in Event SPACE: NTT, Link Admin, AGL, Mindtree/Larsen & Toubro, Sihuan Pharma
- Infomedia Receives a A$1.70 Per Share Offer from TA Associates and Viburnum
- Asia-Pac Weekly Risk Arb Wrap: Mindtree/Larsen, AGL, Link Admin, Link Net, Comany, Infomedia
Toshiba (6502) – Iffy Earnings, Worse Projections, A Special Div, But Privatisation Process Proceeds
- Toshiba announces meh-to-weak earnings and surprisingly conservative revenue guidance for next year given better order books and backlog and much higher USD/yen.
- The company announced a slightly higher March 2022 dividend (giving money to past shareholders) and a big special dividend and higher March 2023 dividend.
- The Privatisation Proposal Process continues. It may get a result, or not. New director choices will wait. Now we start a quiet period where privatisation news competes with analyst bearishness.
HUGE Wacoal (3591) Buyback – Buyback Structure Unknown But Interesting Possibilities Exist
- On Friday, Wacoal Holdings (3591 JP) announced earnings, adoption of IFRS this year (US GAAP til now), dividends, a div hike and higher earnings this year, and a HUGE buyback.
- The buyback is for up to 5.5mm share (8.95% of shares) spending up to ¥10bn.
- Given the structure of the shareholder base, this opens up interesting possibilities.
Sakata Inx (4633) HUGE Buyback Makes Things Interesting
- Sakata Inx Corp (4633 JP) and Toyo Ink Sc Holdings (4634 JP) are finally getting around to unwinding the rest of their cross-holdings from their decision 5yrs ago.
- This is highly accretive. +10% on EPS this year on a weighted average basis and +16.8% on a spot basis.
- The reason is good governance and capital efficiency. A side effect is it shifts the shareholder structure more in favor of economic investors.
Index Rebalance & ETF Flow Recap: MSCI STD/SC, FTSE AW/AC, EPRA, MVIS, TW50, Mindtree/L&T, AMFI
- MSCI announced the changes to the Standard and Small Cap Indexes, along with FIF/NOS changes as part of the May SAIR. Plenty of flows in Asia Pacific.
- Announcement of changes to the FTSE AW/AC, HSI INDEX, HSCEI INDEX, HSTECH INDEX and SENSEX INDEX will be made after market close on Friday.
- There were inflows into Taiwan, Australia and Hong Kong focused ETFs, while there were redemptions from China and Korea focused ETFs.
Infomedia (IFM AU): TA Associates/Viburnum Funds Proposal
- Online auto parts and service provider Infomedia Ltd (IFM AU) has received a non-binding proposal – by way of a Scheme – from TA Associates and Viburnum Funds.
- The Offer price is A$1.70/share, a 32.8% premium to last close.
- Via a tie-in with Viburnum, TA disclosed a 14.46% interest. IFM said it is also in preliminary discussions with other interested parties.
Hitachi Maxell (6810 JP) – Very Big On-Market Buyback
- Maxell Ltd (6810 JP) has been restructuring itself and the cost-cutting and rationalising of sales efforts and regions has led to post-relisting record OP.
- But another (non-cash) write-off this past year has led to the third year of net losses in a row.
- The company has, however, taken its actual cashflows and turned them into a large buyback
Last Week in Event SPACE: NTT, Link Admin, AGL, Mindtree/Larsen & Toubro, Sihuan Pharma
- The NTT (9432 JP) / NTT Data (9613 JP) transaction is a little complicated, but the end goal appears, like before, to push operating control below holdcos on the chain.
- Both Link Administration (LNK AU) and Dye & Durham tanked over the unfortunate timing of an ACCC delay and MAC disconnect – before a price recovery to close the week.
- MCB says the AGL Energy Ltd (AGL AU) de-merger plan is bad, and now analysts say it is “underwhelming.” Duh. But the alternative? Underwhelming too, but less independent.
Infomedia Receives a A$1.70 Per Share Offer from TA Associates and Viburnum
- TA Associates and Viburnum Funds’ non-binding indicative privatisation proposal is A$1.70 per Infomedia Ltd (IFM AU) share in cash, a 32.8% premium to the last close.
- The timing of the bid looks opportunistic in the context of the shares hitting a 3-year low on 9 May. Viburnum with a 14.5% stake is the largest shareholder.
- The Board notes expressions of interest from other parties. TA and Viburnum’s bid is the catalyst for other bidders to show their hands.
Asia-Pac Weekly Risk Arb Wrap: Mindtree/Larsen, AGL, Link Admin, Link Net, Comany, Infomedia
- There are 37 – mostly firm – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Three news deals this week: Mindtree Ltd (MTCL IN)/ Larsen & Toubro Infotech (LTI IN)‘s merger, Comany Inc (7945 JP) ‘s MBO, Infomedia Ltd (IFM AU)‘s proposal from TA/Viburnum Funds.
- Key updates took place for: AGL Energy Ltd (AGL AU), Link Administration Holdings (LNK AU), Virtus Health (VRT AU), Link Net (LINK IJ) & Beijing Enterprises Urban Resources (3718 HK).
Before it’s here, it’s on Smartkarma
