In today’s briefing:
- Toyo Construction (1890) Tender Situation Indeed Getting Funky
- Crown Resorts: Scheme Booklet Lodged. Shareholder Meeting On 29 April
- 51job (JOB US): EGM On The 27 April
- Hazama Ando (1719 JP) – Big Buyback Is Set & Forget
- MSCI Korea Index Review: Kakao Pay Inclusion Possibilities
- 51job’s Privatisation Offer to Be Voted for on 27 April
- HSCEI Dividend Futures: 2022 Fair Value Update & CNOOC/Sunac/JD.com Adjustments
- JPX-Nikkei 400 Rebalance 2022: Leaderboard End-Mar 2022
- Irongate Enters into an SIA with Charter Hall and PGGM
- S&P BSE Indices (SENSEX Family): Quiddity Leaderboard for June 2022 Rebalance
Toyo Construction (1890) Tender Situation Indeed Getting Funky
- Toyo Construction (1890 JP)‘s Independent Committee thought this deal was being done too cheaply, but they signed off on it. I thought it was cheap too.
- I thought that a leading activist in the name would think so too, and try his hand because of his running start of 7+%. Huge volume Day1 sparked wider interest.
- It has traded every day so far above terms so far but on the first full day of trading, the activist Murakami-san bailed. That changes things, but… it’s still funky.
Crown Resorts: Scheme Booklet Lodged. Shareholder Meeting On 29 April
- Crown Resorts (CWN AU)‘s Scheme Booklet is now out. The Scheme Meeting will be held on the 29 April with possible implementation on the 12 May.
- The Independent Expert has concluded Blackstone’s Offer is fair and reasonable and in the best interest of Crown shareholders.
- This transaction is a done deal, and is trading accordingly.
51job (JOB US): EGM On The 27 April
- On the 1 March, 51 Job Inc (JOBS US) said it had entered into a revised merger agreement at US$61.00/share, 22.8% down from the initial terms.
- 51job has now announced that it has called an extraordinary general meeting of shareholders to be held on April 27.
- Despite regulatory opacity, this transaction appears done. Separately, 51job’s FY21 financials will be released tomorrow.
Hazama Ando (1719 JP) – Big Buyback Is Set & Forget
- Hazama Ando spent a long time coming out of its doldrums. In February 2020, it started to improve. It started a buyback, scarfing up 22% of volume in 6 weeks.
- Later in 2020, another, and in 2021, another still, now with the last one finished in a hurry, they announced another. They’ve bought back stock 17 months in a row.
- It’s not clear the master rules of the buyback, but historically they have been reasonably aggressive. I expect that continues.
MSCI Korea Index Review: Kakao Pay Inclusion Possibilities
- The minimum float-adjusted market cap of non-constituents such as Kakao Pay should be 1.8x of the cutoff float market cap if the FIF is 0.15 or less.
- Kakao Pay has to rise by 5.92% by the Price Cutoff Date for a 12% float. So, the key is whether MSCI will classify Alipay’s entire stake as non-float.
- Assuming a 40% float, Kakao Pay will face a passive inflow of ₩576B or 3.84M shares, which are close to 17.4x the current ADTV.
51job’s Privatisation Offer to Be Voted for on 27 April
- The EGM to approve the 51 Job Inc Adr (JOBS US)’s privatisation offer of $61.00 in cash per ADS will be held at 9 am (Shanghai time) on 27 April.
- The transaction is expected to close during the second quarter of 2022. The continuing shareholders represent 56.2% of the voting rights according to the proxy statement.
- Based on 67.5 million ADS entitled to vote at the EGM, around 21% of disinterested shareholders are required to vote in favour to meet the two-thirds voting threshold.
HSCEI Dividend Futures: 2022 Fair Value Update & CNOOC/Sunac/JD.com Adjustments
- Most companies have announced their final dividends for 2021 and most of those have announced ex-dates. Banks and oil companies have announced higher dividends than last year.
- CNOOC Ltd (883 HK) has not declared a dividend yet due to its IPO, while Sunac China Holdings (1918 HK)‘s suspension could lead to index deletion in June or July.
- Using current/proforma index compositions and conservative estimates for interim dividends, we estimate fair value at 240.73 DIPS for 2022. This is a sell at the last close or higher.
JPX-Nikkei 400 Rebalance 2022: Leaderboard End-Mar 2022
- JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
- A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
- Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2022 based on trading data as of end-March 2022.
Irongate Enters into an SIA with Charter Hall and PGGM
- Irongate Group (IAP AU) has entered into an SIA with Charter Hall and PGGM. The offer of A$1.90 and maximum FY22 distribution of 4.67 cents implies a total of A$1.9467.
- The scheme booklet will be dispatched in May with an implementation date in late July. The offer price is attractive in terms of multiples and security prices.
- At the last close and for the July-end implementation date, the gross and annualised spread of the total offer is 1.4% and 4.2%, respectively.
S&P BSE Indices (SENSEX Family): Quiddity Leaderboard for June 2022 Rebalance
- The S&P BSE family of indices represents the performance of stocks listed on the Bombay Stock Exchange (BSE) across various sizes, themes, industries, and strategies.
- This series will mainly focus on the following indices of the S&P BSE family: S&P BSE 500, S&P BSE 200, S&P BSE 100, and S&P BSE SENSEX.
- In this insight, we take a look at the leading candidates who could become Adds/Deletes during the June 2022 Semi-annual Rebalance.
Before it’s here, it’s on Smartkarma
