In today’s briefing:
- 7&I (3382) – MBO Off, SC “Engaging Constructively with ACT”, Skepticism Higher, Questions And More
- The Beat Ideas: What Is Inside Jio Financial Services?
- JPH Launches “MBO” (LBO with SARs for Family/Execs) For Trucker Tonami Holdings (9070). Too Cheap.
- Japan Post Bank (7182) – Missed Opportunity Leaves Likely Shadow Overhang
- Japan Post Bank (7182 JP): A US$4.2 Billion Secondary Offering
- We Doctor Holdings IPO Preview: Explosive Growth and Narrowing Losses, The Right Time for an IPO
- ASX200 Index AdHoc Rebalance Preview: Mesoblast (MSB) Could Replace Arcadium Lithium (LTM) Next Week
- EA Resilience Is Perfunctory Problem
- STAR 100: Quick Update to Expectations for Last-Minute Methodology Changes; Announcement Soon.
- Japan Post Bank US$4bn Placement – Smaller Deal, Similar Structure, Might Yield Similar Results
7&I (3382) – MBO Off, SC “Engaging Constructively with ACT”, Skepticism Higher, Questions And More
- The MBO is off. Itochu Corp (8001 JP) has apparently not been able to agree with Ito-san on board composition/representation and management control. That the MBO is off isn’t surprising.
- 7&i says they “continue to engage constructively with ACT and alternate proposals but news articles suggest that almost 6mos after proposing an NDA, ACT still haven’t had access to financials.
- The shares are off hard today to a level below where ACT’s first bid was considered “not even worth discussing”. There will be questions at the AGM and before.
The Beat Ideas: What Is Inside Jio Financial Services?
- Jio Financial Services (JIOFIN IN) has launched a robust digital ecosystem with its flagship JioFinance app, enhancing its tech-driven financial service offerings.
- The digital-first strategy minimizes legacy constraints, enabling personalized financial solutions that significantly boost efficiency and competitive advantage.
- This evolution redefines traditional banking, positioning JFSL as a versatile, technology-led powerhouse for sustainable growth in India’s financial sector.
JPH Launches “MBO” (LBO with SARs for Family/Execs) For Trucker Tonami Holdings (9070). Too Cheap.
- Yesterday, Japan Post Holdings (6178 JP) announced an MBO for Tonami Holdings (9070 JP) whereby the family/execs will stay on. JPH will own 99.97%, the execs/family 0.03%.
- This deal is yet another in a line of logistics deals dating back the last 2+ years where the premium has been quite big. This time is +74%.
- But this is not overly expensive. Makes me go hmmmm…
Japan Post Bank (7182) – Missed Opportunity Leaves Likely Shadow Overhang
- The Offering comes in lighter than expected. The buyback is smaller than expected. The resultant overhang is larger than expected.
- The index flows around the delivery date are well-understood. They are what they are.
- Shareholder structure is such that this is not quite a new IPO but needs a lot of new shareholders. BUT… there is one redeeming feature one should not ignore.
Japan Post Bank (7182 JP): A US$4.2 Billion Secondary Offering
- Japan Post Bank (7182 JP) has announced a secondary offering of up to 416.1 million shares (including overallotment), worth around US$4.2 billion.
- The offering includes a ToSTNeT-3 and an on-market buyback. Including the overallotment, Japan Post Holdings (6178 JP) will reduce its stake from 61.50% to 50.00% of voting rights.
- Understanding the potential offer price requires looking at JPH’s past sales and recent large Japanese placements. The pricing date is likely 10 March.
We Doctor Holdings IPO Preview: Explosive Growth and Narrowing Losses, The Right Time for an IPO
- We Doctor Holdings, a top-tier provider of AI-enabled medical services and digital platform which connects hospitals, doctors, and pharmacies, plans to go public in Hong Kong.
- We Doctor Holdings has raised ~$1.5B to date from investors, including Tencent, 5Y Capital, Goldman Sachs, Hillhouse Capital, AIA, and Qiming Venture Partners, among others.
- The Hangzhou-based healthtech company has delivered explosive revenue growth of 107% y/y for the six months ended Jun-24.
ASX200 Index AdHoc Rebalance Preview: Mesoblast (MSB) Could Replace Arcadium Lithium (LTM) Next Week
- There could be ad hoc change for the S&P/ASX 200 (AS51 INDEX) prior to the announcement of the changes at the March rebalance.
- Arcadium Lithium (LTM AU) could stop trading next week following the acquisition by Rio Tinto Ltd (RIO AU). The Royal Court of Jersey could sanction the scheme on 5 March.
- Mesoblast (MSB AU) is a high probability inclusion to the index, followed by DigiCo Infrastructure REIT (DGT AU). The stock that misses out will be added at the regular rebalance.
EA Resilience Is Perfunctory Problem
- Crashing US surveys in 2025 have looked idiosyncratic, as spurious exaggeration of exceptionalism ends. The ESI corroborates the PMI’s resilience in the euro area.
- Price expectations have been trending further above long-run averages without a one-off shock, suggesting European policy is too loose for this stage of the economic cycle.
- EA unemployment remains lower than a year ago, inconsistent with tight monetary conditions. We still see the ECB’s last cut in June, much sooner than the market prices.
STAR 100: Quick Update to Expectations for Last-Minute Methodology Changes; Announcement Soon.
- STAR 100 index tracks the next 100 names (51st-150th ranks) and it represents the mid-cap segment of the STAR market.
- The methodology for constituent selection for this index was revised yesterday. These revisions will influence the ADDs/DELs for the March 2025 review which is to be announced soon.
- In this insight, we have presented our updated expectations for the new methodology.
Japan Post Bank US$4bn Placement – Smaller Deal, Similar Structure, Might Yield Similar Results
- Japan Post Holdings (6178 JP) (JPH) aims to sell around US$4bn worth of Japan Post Bank (7182 JP) (JPB), trimming its stake to below 50%.
- JPH had last sold around US$9bn worth of JPB shares in Mar 2023. That deal had a similar structure and it didn’t end up performing well.
- In this note, we talk about the deal dynamics and run the deal through our ECM framework.
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