In today’s briefing:
- The Keppel Restructuring – Forward Sum Of The Parts Makes KEP Look Cheap. And It Is… But…
- Sembcorp Marine & Keppel O&M Combination: Details & Index Implications
- Hitachi Transport System (9086) Shareholders Get the BIG Win in This VLBO
- Straits Times Index (STI) Rebalance Preview: YZJFH Is the Delete
- ToyoKen (1890)- Infroneer Declines to Bid Up, YFO Now In Driver’s Seat – Now It’s A Range Trade
The Keppel Restructuring – Forward Sum Of The Parts Makes KEP Look Cheap. And It Is… But…
- The Keppel O&M / SMM Combination and Keppel Rig Asset Restructure were announced today and the arithmetic is both tough and interesting. There’s a little magic here.
- KEP shareholders receive SMM shares worth ~1/3 of today’s share price, and the rest is currently valued at well under Net Tangible Assets post-Restructuring/Transaction.
- That suggests Keppel has upside, but one must think carefully about the exposures.
Sembcorp Marine & Keppel O&M Combination: Details & Index Implications
- Keppel Corp and Sembcorp Marine have announced a proposed combination of Keppel O&M and Sembcorp Marine to create a global player in offshore renewables, new energy and cleaner O&M solutions.
- Keppel Corp (KEP SP) and its shareholders will own 56% of the combined entity, while Sembcorp Marine (SMM SP) shareholders will own the other 44%.
- Depending on the combined entity market cap, there could be selling from MSCI Standard and FTSE Straits Times Index (STI) (STI INDEX) trackers at the time of implementation.
Hitachi Transport System (9086) Shareholders Get the BIG Win in This VLBO
- KKR and Hitachi Ltd (6501 JP) have a deal to get KKR to buy Hitachi Transport System (9086 JP) in a VLBO (Very Leveraged BuyOut).
- As somewhat expected, it is a “split price deal” where Hitachi will accept a lower price for its 40% stake than minorities will receive in a Tender Offer.
- This is a big win for Hitachi Transport shareholders, but the Tender Offer likely won’t start until late September.
Straits Times Index (STI) Rebalance Preview: YZJFH Is the Delete
- Yangzijiang Financial Holding (YZJFH SP) started to trade on the SGX today following its spin-off from Yangzijiang Shipbuilding (YZJSGD SP). YZJFH’s last price was S$0.65/share.
- The FTSE Straits Times Index (STI) (STI INDEX) currently has 31 members and the lowest ranked constituent by full market cap at the close today will be deleted.
- At current prices, Yangzijiang Financial Holding (YZJFH) will be deleted from the FTSE Straits Times Index (STI) (STI INDEX) at the close on 4 May. Comfortdelgro avoids deletion for now.
ToyoKen (1890)- Infroneer Declines to Bid Up, YFO Now In Driver’s Seat – Now It’s A Range Trade
- Toyo Construction (1890 JP) today released a change to its Target Opinion Statement for Infroneer’s takeover bid at ¥770/share. It supports the tender itself, but withdraws its recommendation investors tender.
- Infroneer refused to raise their price, so this effectively kills their bid (though they will extend). TC will engage with Yamauchi Family Office which has separately offered to bid ¥1,000/share.
- The dynamics have now changed. This is a range trade, and will likely take time unless Infroneer says “I’ll sell at ¥1,000/share.”
Before it’s here, it’s on Smartkarma
