In today’s briefing:
- JAPAN ACTIVISM: Activists Sell ALL Their Daidoh (3205) In One Day. Oops 😬
- HUGE Asics (7936) Offering – Big Guidance Boost at ATH So Feed the Ducks When They Are Quacking
- ASICS (7936 JP): A US$1.4 Billion Secondary Offering
- Reorganization of the Doosan Group: Why Delist Doosan Bobcat (Jewel of Doosan Group)?
- ASICS (7936) | Obadele Thompson or Usain Bolt?
- Hyundai Motor India IPO: The Bull Case
- Last Week in Event SPACE: Toyota, Asia Cement, Hanwha Corp, Kokusai Electric, Keisei Electric
- (Mostly) Asia-Pac M&A: Second Chance Properties, Shinsung Tongsang, Rex Minerals, Canvest, Altium
- EQD | KOSPI 200 Sell-Off Could Accelerate This Week, But It’s A BUY
- MMG Limited (1208.HK) Rights Issue – 98.18% Taken Up
JAPAN ACTIVISM: Activists Sell ALL Their Daidoh (3205) In One Day. Oops 😬
- Daidoh Ltd (3205 JP) saw an activist “win” at its AGM, another activist bought, the stock popped. I wrote about it. 2hrs later, the Board set a new Div Policy.
- ¥100/Yr for 3 years in a row. That was 11% of then-current price. Big activist win for Strategic Capital which owned 25% and Murakami-san who had gone substantial 1wk earlier.
- Today post-close, Strategic Capital reported it sold everything on 5 July, the next day. WOW. That was half of Maximum Real World Float. Oops. Murakami-san sold too.
HUGE Asics (7936) Offering – Big Guidance Boost at ATH So Feed the Ducks When They Are Quacking
- Today after the close, ASICS Corp (7936 JP) announced a very large secondary offering. It points out that as a global brand, it needs global-standard corporate governance.
- As such, it says they’ve been discussing sales with crossholders. But we knew the cross-holders were going to sell. This offering is 85mm shares, ¥210bn at last. That’s big.
- The stock has doubled year-to-date. Today they raised FY guidance BIGLY (+60% OP and NP). Now a huge offering. This seems like a “feed the ducks when they’re quacking” situation.
ASICS (7936 JP): A US$1.4 Billion Secondary Offering
- ASICS Corp (7936 JP) has announced a secondary offering of up to 85.0 million shares (including overallotment). At the close, the offer, including overallotment, is worth JPY218 billion (US$1.4 billion).
- Asics’ goal with the secondary offering is to eliminate cross-shareholdings. Asics also announced a material upgrade to full-year forecasts to offset the impact of the offering.
- Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will fall between 23 and 26 July (likely 23 July).
Reorganization of the Doosan Group: Why Delist Doosan Bobcat (Jewel of Doosan Group)?
- On 11 July, the Doosan Group announced a major business structure reorganization, including the delisting of Doosan Bobcat Inc (241560 KS).
- In our view (over the next 3-6 months), these transactions appear to be value-destroying for Doosan Bobcat and Doosan Enerbility minority shareholders but positive for Doosan Robotics shareholders.
- Doosan Robotics plans to acquire the remaining 54% stake in Doosan Bobcat through a tender offer. Once Doosan Robotics fully owns Doosan Bobcat, its shares will be delisted.
ASICS (7936) | Obadele Thompson or Usain Bolt?
- ASICS is revising up its full year forecasts, now expecting sales to reach a record ¥660 billion , up 15.7% year-over-year. There is a strong currency tail wind.
- Still “you gotta be in it to win it..” ASICS is currently crushing it, while Nike flounders
- A large secondary offering will likely hit the share price in the short term; there are two key risks…but it could be a good opportunity to buy.
Hyundai Motor India IPO: The Bull Case
- Hyundai Motor India (1342Z IN), a subsidiary of Hyundai Motor (005385 KS), aims to raise up to US$3.0 billion at a valuation of US$17 billion.
- HMIL is India’s second largest passenger vehicle manufacturer, as measured by domestic passenger vehicle sales. It serves as Hyundai’s production and export hub for emerging markets.
- The bull case rests on a strong market position, premiumisation-led growth, top-quartile operating and FCF margin profile.
Last Week in Event SPACE: Toyota, Asia Cement, Hanwha Corp, Kokusai Electric, Keisei Electric
- The Toyota Group cross-holding ecosystem is in flux. They started with a small announcement by Aisin (7259 JP) but moves have come fast and furious.
- Apparently minorities are grumbling to the SFC about the low-balled Offer for Asia Cement China (743 HK). And for good reason. The best course of action? Vote against the Scheme.
- Hanwha Corporation (000880 KS) is trading at a steep NAV discount. And the controlling family is making a partial Offer to gain majority control.
(Mostly) Asia-Pac M&A: Second Chance Properties, Shinsung Tongsang, Rex Minerals, Canvest, Altium
- I tally 46 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Four new deals discussed this week on Smartkarma: Second Chance Properties (SCE SP)‘s VGO,Shinsung Tongsang (005390 KS)‘s Tender, Rex Minerals (RXM AU)‘s Scheme, and Canvest (1381 HK)‘s possible Offer.
- Key updates took place on Altium Ltd (ALU AU), Pacific Smiles (PSQ AU), Asia Cement China (743 HK), Shanghai Henlius Biotech (2696 HK), and Kfc Holdings Japan (9873 JP).
EQD | KOSPI 200 Sell-Off Could Accelerate This Week, But It’s A BUY
- The KOSPI 200 INDEX started a modest pullback and is entering a BUY area, but it could fall further this coming week, caution is advised.
- The support levels to buy are between 383-371, this coming week.
- Alternatively buy the Close, if the WEEKLY Close is negative, next Friday.
MMG Limited (1208.HK) Rights Issue – 98.18% Taken Up
- While there may be still be some overhang once the rights shares start trading, this is a good entry point
- Applications for 6.4 Billion excess rights shares received from 11 applications
- Rights shares will start trading on Tuesday 16th of July
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