In today’s briefing:
- FTSE GEIS March 2022 Index Rebalance Preview: Japan
- MCT SP + MAGIC SP = MPACT SP: Proposed Merger Details & BIG Index Impact
- LG Energy: Sector ETFs Special Rule Change & Local Active Managers’ Preemptive Trading
- Grab (GRAB US) – After the Storm
- (Mostly) Asia M&A: December 2021 Roundup
FTSE GEIS March 2022 Index Rebalance Preview: Japan
- For Japan, the FTSE Russell March 2022 SAIR will use today’s closing prices to calculate the market cap cut-offs to determine the inclusions and exclusions for the All-World/All-Cap indices.
- For the All-World Index, we see 1 inclusion, 3 migrations higher and 8 migrations lower. For the All-Cap Index, we see a lot of inclusions and low double digit deletions.
- There is a fair amount of short interest on quite a few potential inclusions/ exclusions/ migrations up and down and it we would pay more attention to these stocks.
MCT SP + MAGIC SP = MPACT SP: Proposed Merger Details & BIG Index Impact
- Mapletree Commercial Trust (MCT SP) is looking to merge with Mapletree North Asia Commercial Trust (MAGIC SP) to create one of the top 10 Commercial REITs in Asia.
- MAGIC SP unitholders will receive a scheme consideration of S$1.1949/unit of MAGIC SP, and will have a scrip-only option and a cash and scrip option.
- The increase in index shares for Mapletree Commercial Trust (MCT SP) will result in large buying from passive FTSE EPRA Nareit Developed Asia, Straits Times Index and MSCI Singapore trackers.
LG Energy: Sector ETFs Special Rule Change & Local Active Managers’ Preemptive Trading
- The ETF operators (KODEX and TIGER) applied to KRX for approval of a special change for an early swap between LG Chem and LG Energy.
- KRX will likely approve this special change application, and the effective date should be immediately after listing. I will update when the exact implementation date of each index is released.
- We also detect a trend spreading in the local industry that many local active managers decided to sell all other secondary battery stocks to raise funds to purchase LG Energy.
Grab (GRAB US) – After the Storm
- Grab (GRAB US) has faced a perfect storm of headwinds since its IPO with Omicron, US tapering fears, and a general tech sell down all contributing to share price weakness
- The company continues to invest in broadening its product offering and recently acquired Jaya Grocer in Malaysia and a stake in mutual fund platform Bareksa in Indonesia.
- Grab (GRAB US) looks to be on the cusp of a recovery in its mobility business with increasing scope and value-added in both online groceries and digital financial services.
(Mostly) Asia M&A: December 2021 Roundup
- For the month of December, 12 new deals (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$4bn.
- The average premium for the new deals announced (or first discussed) in December was ~41%, with a year-to-date average of ~33% (165 deals & total deal size of US$282bn).
- This compares to the average premium for all deals in 2020 (158 deals) and 2019 (145 deals) of 31% and 31.5% respectively.
Before it’s here, it’s on Smartkarma
