In today’s briefing:
- Daifuku (6383) To Take Out Minorities in Subsidiary Contec (6639)
- Amazon 4Q21: Don’t Call It a Comeback, We’ve Been Here (Investing) For Years
- Korea Small Cap Gem #13: Daehan Flour Mills
- Goo Chemical (4962 JP) MBO – Super Illiquid Kyoto-Based Specialty Chems Maker – A Done Deal
- Last Week in Event SPACE: BHP, Bank Of East Asia, Sydney Airport, Boral
Daifuku (6383) To Take Out Minorities in Subsidiary Contec (6639)
- Daifuku Co Ltd (6383 JP) today (4 Feb) announced it would take out TSE-2 industrial computing/IoT subsidiary Contec Co Ltd (6639 JP) in a tender offer at 55% premium.
- That looks nice, and should have been expected at some point. But it is only half-generous.
- The shareholder structure tells you how this is likely to end up.
Amazon 4Q21: Don’t Call It a Comeback, We’ve Been Here (Investing) For Years
- Prime price increased, Covid expenses starting to moderate, margins set to rise.
- Fulfillment buildout moderates, 1-day shipping can now launch more widely, share gains will ensue, revenue growth will reaccelerate.
- We reiterate Amazon as our Top 2022 long idea. We think its worth $6,000.
Korea Small Cap Gem #13: Daehan Flour Mills
- Daehan Flour Mills is the 13th company in our Korea Small Cap Gems series.
- Daehan Flour Mills is one of the largest companies in Korea engaged in the flour milling industry. It provides various types of flour in Korea.
- Daehan Flour Mills, which is a deep value play, has just become very interesting since Lee Jong-Gak (honorary chairman and largest shareholder of the company), passed away on 3 February.
Goo Chemical (4962 JP) MBO – Super Illiquid Kyoto-Based Specialty Chems Maker – A Done Deal
- This is a PE Fund-sponsored MBO of a small Kyoto-based specialty chemicals manufacturer.
- It is far less liquid than the market cap would suggest, which tells you something about the very un-transparent shareholder register.
- This is theoretically an “independent” deal with a majority-of-minority but it will get done at a slightly too low price because of huge friendly shareholder base.
Last Week in Event SPACE: BHP, Bank Of East Asia, Sydney Airport, Boral
- If BHP Group (BHP AU) announces an off-market buyback, there will be demand to replace the shares bought back, re-based higher.
- Bank of East Asia (23 HK)is trading cheap as Elliott throws in the towel.
- The Sydney Airport (SYD AU) selldown could be larger than people expect, and it is a decent chance to put on the arb trade.
Before it’s here, it’s on Smartkarma
