In today’s briefing:
- Pasona (2168 JP) Special Div – Too Small to Matter
- Get Your Pasona (2168 JP) Rump For Free
- A/H Premium Tracker (To 12 Apr 2024): Liquid AH Premia Still Very Wide, The Right Spreads Behaving
- Baicha Baidao (2555 HK) IPO: Valuation Insights
- Imminent Block Deals Involving Hanmi Science Shares Due to Inheritance Tax Payments
- Vodafone Idea Placement – Very Well Flagged but Its Not Going to Fix a Whole Lot of Issues
- ECM Weekly (15th Apr 2024) – Hyundai Marine, Bharti, Kayou, Zeekr, ChaPanda, Samsung, WT Micr, Sompo
- Tietto Minerals (TIE AU): Zhaojin’s Revised and Final Takeover Offer Remains Light
- Ohayo Japan | Escalating Tensions
- Horizon Robotics IPO Preview: “Journey Together”, Strong Business Position and Market Share Gains
Pasona (2168 JP) Special Div – Too Small to Matter
- On Friday, Pasona Group (2168 JP) announced its expected use of funds into the May 2024 results, including a special dividend plan, investment for growth, and “strengthening the operating platform.”
- The plan will disappoint. The stock may get hit hard. The truth is somewhere in the middle. This is where active stewardship matters. So get stewarding.
- A special div paid over 5yrs should be paid one-shot, now. If the company has plans worth supporting, set KPIs now, ask for money later. Good plans get good money.
Get Your Pasona (2168 JP) Rump For Free
- Dai Ichi (8750 JP) agreed with Pasona (2168 JP) for Pasona to sell its shares back to Benefit One (2412 JP) in a buyback after Dai-Ichi’s Tender Offer for Benefit.
- This process gives Pasona a tax advantage versus selling into a Tender Offer at the same price.
- What does Pasona take home? ~¥2,822/share versus its last price of ¥2,733/share. Then you have stubs ops (conservatively worth up to ~¥1,960/share) and Pasona’s stake in Bewith (9216 JP) (~¥360/share).
A/H Premium Tracker (To 12 Apr 2024): Liquid AH Premia Still Very Wide, The Right Spreads Behaving
- The New/Better A-H Premium Tracker has tables, charts, measures galore to track A/H premium positioning, southbound and northbound positioning/volatility in pairs over time, etc.
- SOUTHBOUND’s consecutive buying streak ended on Monday 25-March, then started again. NORTHBOUND has started selling (but buying semi tech).
- Hs rebounded vs As. AH Premia still wide. Fabulous two-week performance by the Quiddity Portfolio (+2.09% over the two weeks) on a delta 3:1 long H/short A
Baicha Baidao (2555 HK) IPO: Valuation Insights
- Sichuan Baicha Baidao Industrial (SCBCBDID CH), a leading freshly made tea drinks company, has launched an HKEx IPO to raise US$330 million. The shares will be listed on 23 April.
- We previously discussed the IPO in Baicha Baidao IPO: The Bull Case and Baicha Baidao IPO: The Bear Case.
- There are no cornerstone investors. Our valuation analysis suggests that Baicha is fairly valued at the HK$17.50 IPO price. Therefore, we would pass on the IPO.
Imminent Block Deals Involving Hanmi Science Shares Due to Inheritance Tax Payments
- The local market anxiously awaits the family’s ability to pay by early May. Failure could prompt the Tax Service to sell their pledged stocks, including Hanmi Science shares.
- Preventing Tax Service from selling Hanmi Science shares requires additional collateral, unlikely due to existing pledges. Rumor suggests mother and daughter may sell shares before May, followed by Tax Service.
- Given negotiation uncertainty with KKR, it’s crucial to prepare for potential failure rather than solely relying on success, necessitating a pragmatic approach.
Vodafone Idea Placement – Very Well Flagged but Its Not Going to Fix a Whole Lot of Issues
- Vodafone Idea (IDEA IN) plans to raise around US$2.2bn via a follow-on public offering.
- The deal has been in the works for years and proceeds will be used for capex and short-term debt repayment.
- In this note, we will run the deal through our ECM framework and talk about the deal dynamics.
ECM Weekly (15th Apr 2024) – Hyundai Marine, Bharti, Kayou, Zeekr, ChaPanda, Samsung, WT Micr, Sompo
- Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
- On the IPO front, the focus remained on HD Hyundai Marine Solution (443060 KS), even as Sichuan Baicha Baidao Industrial is gearing up to launch its IPO.
- On the placement front, there were deals across India, South Korea and Australia.
Tietto Minerals (TIE AU): Zhaojin’s Revised and Final Takeover Offer Remains Light
- Tietto Minerals Ltd (TIE AU) has disclosed a revised conditional proposal from Zhaojin Mining Industry H (1818 HK) at A$0.68 per share, a 17.2% premium to the previous offer of A$0.58.
- The offer is conditional on a 50.1% minimum acceptance condition (which can be waived). The offer is declared best and final.
- Despite the bump, the offer is below the IE’s valuation range of A$0.79 to A$0.93 per share. The IE’s valuation range would be around 25% higher at current gold prices.
Ohayo Japan | Escalating Tensions
- The Dow Jones Industrial Average marked its sixth consecutive decline amidst fears of further conflict escalation
- The yen slipped to the mid-154 range against the dollar on Monday, marking its lowest level since June 1990
- Sony Group is preparing to unveil a more potent PS5 console, possibly by the end of this year.
Horizon Robotics IPO Preview: “Journey Together”, Strong Business Position and Market Share Gains
- Horizon Robotics, a consumer-centric and fast-growing provider of integrated ADAS and AD solutions for passenger vehicles, filed for an IPO and plans to raise up to $500M in Hong Kong.
- Horizon Robotics was founded in 2015 by Dr. Yu Kai, Dr. Chang Huang, Ms. Feiwen Tao, and a group of scientists and tech entrepreneurs.
- I have a positive view of an upcoming IPO and believe Horizon Robotics is in a great position to capitalize on rapidly growing smart vehicles market in China and worldwide.
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