In this briefing:
- MYOB (MYO AU): KKR Making Out like Bandits Due to a Sharp Market Rally
- Last Week in GER Research: API/Sigma, M1, Eclipx/Mcmillan and Hansoh IPO
1. MYOB (MYO AU): KKR Making Out like Bandits Due to a Sharp Market Rally
MYOB Group Ltd (MYO AU)‘s shares are trading A$3.42, marginally above KKR & Co Inc (KKR US)‘s revised lower offer of A$3.40 cash per share, due to the expectation of a bidder trumping KKR. The optimism has also been stoked by the sharp market rally since MYOB agreed to recommend KKR’s revised lower offer on 24 December 2018. The ASX 200 and ASX 300 Information Technology Index has rallied 10% and 20% respectively from 24 December 2018 to 15 February 2019.
While shareholders may feel like KKR is acquiring MYOB at a knockdown price, the market could quickly revert to a downward trend. We believe that shareholders hoping for a white knight to ride to the rescue will be disappointed.
2. Last Week in GER Research: API/Sigma, M1, Eclipx/Mcmillan and Hansoh IPO
In this version of the GER weekly research wrap, we assess the bump prospects in the Australian Pharma Industries (API AU) / Sigma Healthcare (SIG AU) potential merger. Arun updates on M1 Ltd (M1 SP) which could be delisted following an unconditional offer. In addition, we dig into the trading update for Eclipx (ECX AU) and assess the risks that Mcmillan Shakespeare (MMS AU) could walk away from the deal. Finally, we initiate on the IPO of Hansoh Pharmaceutical (HANSOH HK). A calendar of upcoming catalysts is also attached.
More details can be found below.
Best of luck for the new week – Rickin, Venkat and Arun
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