In today’s briefing:
- Toyota Partial Offer Results – What Next?
- Terumo (4543 JP) Secondary Offering – Smaller Than It Looks
- MV Australia Equal Weight Index Rebalance Preview: One Add & A Few Deletes
- Terumo Placement – US$1.4bn Secondary Selldown, Buyback Should Aid Deal Dynamics
- Terumo (4543 JP): A US$1.4 Billion Secondary Offering
- LG Corp Plans to Purchase 200 Billlion Won of LG Electronics and 300 Billion Won of LG Chem
- Sino-American Silicon Early Look – Another Well Flagged GDR Offering in the Works
- Notable Developments in the November Review of the Global Index Korea Standard
- Doosan Mergers: One Canceled, One Still Moving Forward
- Arvida (ARV NZ): 25th Sept Vote On Stonepeak’s Offer
Toyota Partial Offer Results – What Next?
- Today after the close, Toyota Motor (7203 JP) reported the results of their ¥800bn Tender Offer Buyback, originally intended to repurchase 290.12mm shares from cross-holders.
- In the end, 343.83mm shares were tendered (53.71mm shares more than originally expected, worth about ¥150bn at Tender Price). That creates back-end “issues” which must be considered.
- The resulting supply/demand profile is mixed, but on balance, I expect sees positive demand into the H1 earnings announcement. Watch for another buyback possibly announced then.
Terumo (4543 JP) Secondary Offering – Smaller Than It Looks
- On Thursday 29 August, Terumo Corp (4543 JP) announced a secondary offering where 7 major cross-holders would sell just under 5% of the shares outstanding to international investors.
- In recent quarters, Terumo has seen better consensus EPS growth than Peers in recent quarters, and Peers have underperformed. Right now, Terumo isn’t ‘cheap’ but consensus growth is strong.
- This back-end demand in this case has enough moving parts that it bears a closer look.
MV Australia Equal Weight Index Rebalance Preview: One Add & A Few Deletes
- With 2 days left to review cutoff, there could be 1 inclusion and 3 deletions for the index at the September rebalance.
- Even if there are no constituent changes, capping changes will lead to one-way turnover of 4.4% and a round-trip trade of A$212m.
- The final list of inclusions/exclusions will depend on price movements till Friday and whether the index provider makes any significant changes to the free float of stocks in the universe.
Terumo Placement – US$1.4bn Secondary Selldown, Buyback Should Aid Deal Dynamics
- A group of shareholders are looking to raise around US$1.36bn from selling ~5% stake in Terumo Corp (4543 JP).
- While the deal shouldn’t come as a surprise, given the ongoing cross-shareholding unwind narrative in Japan, the timing of such a selldown isn’t always certain.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Terumo (4543 JP): A US$1.4 Billion Secondary Offering
- Terumo Corp (4543 JP) has announced a secondary offering of up to 73.2 million shares, worth JPY203 billion (US$1.4 billion) at the last close.
- The secondary offering facilitates the exit of large shareholders. Terumo also announced a buyback worth a maximum of JPY30 billion or 15 million shares.
- Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will fall between 10 and 12 September (likely 10 September).
LG Corp Plans to Purchase 200 Billlion Won of LG Electronics and 300 Billion Won of LG Chem
- On 29 August, LG Corp announced that it plans to purchase about 200 billion won worth of LG Electronics and about 300 billion won worth of LG Chem.
- After these share purchases, LG Corp’s stake in LG Electronics will increase from 30.47% to 31.59%, and its stake in LG Chem will increase from 30.06% to 31.29%.
- LG Corp plans to purchases these shares starting 1 November 2024. The share purchases will be conducted in two stages and will be completed by 31 March 2025.
Sino-American Silicon Early Look – Another Well Flagged GDR Offering in the Works
- Sino American Silicon Products (5483 TT) is looking to raise at least US$338m in its upcoming global depository receipts (GDRs) offering.
- In late Feb 2024, Sino-American Silicon (SAS) announced its board’s resolution to issue up to 55m common shares via a GDR offering.
- Similar to previous GDR listings, the deal is a long drawn out process with the firm required to jump through a number of board/shareholder/regulatory approval loops.
Notable Developments in the November Review of the Global Index Korea Standard
- Hyundai Rotem is right on the edge for Small Cap→Standard, so it is the only one having a real chance of being included in the November review.
- Doosan Robotics’ float rate will rise to 40% after issuing 20,219,376 new shares, making it a top candidate for inclusion among Outside IMI and comfortably surpassing the cutoff.
- With high trading volume volatility, it’s early to predict passive impact. Watch for momentum buildup like LS Electric and monitor the trading volume of Hyundai Rotem and Robotics closely.
Doosan Mergers: One Canceled, One Still Moving Forward
- Maekyung reported that Doosan Robotics and Bobcat will cancel their merger, but the merger between Robotics and Enerbility’s spun-off company will proceed.
- The merger’s risks have been overblown in Robotics’ stock, which might rebound. Bobcat’s stock outlook is uncertain, with fading merger hopes potentially hurting short-term sentiment.
- The Robotics-Enerbility merger might also be canceled under regulatory pressure, but this could hurt Enerbility’s stock due to debt concerns; forcing the merger may increase costs.
Arvida (ARV NZ): 25th Sept Vote On Stonepeak’s Offer
- Back on the 22 July, Arvida (ARV NZ), a leading retirement living and aged care provider, announced a Scheme from Stonepeak at NZ$1.70/share, in cash, a 65% premium to undisturbed.
- The Scheme Booklet is now out, with a Scheme Meeting to be held on the 25th September. Expected implementation on the 13th November.
- The Scheme Consideration of NZ$1.70/share is within the Independent Adviser’s valuation range at NZ$1.63 to NZ$1.94/share. Arvida’s directors unanimously recommend shareholders to vote in favour of the Scheme.
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