Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Equity Analyst with 10+ years experience in fundamental and event-driven research.

On Smartkarma, I mainly publish insights on index flow events. This includes predicting regular and intra-review index changes and formulating market-neutral trading strategies based on flow catalysts. I also cover special situations such as mergers & acquisitions, equity offerings, buybacks, and other corporate restructuring events.

Pan-Asia Index Flows & Special Situations

3P Learning (3PL AU) : Ed-Tech Cash Deal Now Trading with a View to Complete?

3P Learning (3PL AU) : Indian Ed-Tech Giant BYJU's Competitive Bid

Quiddity M&A: Australia Foreign Investment Reforms

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<p>Previously, on 14th August 2020, <a href="https://www.smartkarma.com/entities/3p-learning-ltd" target="_blank" data-smartkarma-citation="entities:5708:1" rel="noopener">3P Learning (3PL AU)</a> entered into a <a href="https://www.asx.com.au/asxpdf/20200814/pdf/44lhf0sl8gkn8p.pdf" target="_blank" rel="noopener">Scheme Implementation Agreement</a> with privately-owned US-based competitor <a href="https://www.ixl.com/" target="_blank" rel="noopener">IXL Learning</a> ("IXL") in an all-cash Deal that valued the company at a market cap of A$189mn (US$137mn). The Offer Price was A$1.35/share and the Target Board unanimously recommended the Deal to the shareholders. </p><div>
<p>Until early-October, 3PL shares were trading tight to terms with a view to complete. However, media reports of top shareholder Viburnum Funds turning hostile caused 3PL shares to decline sharply on 7th October 2020.</p>
<p>On 12th November 2020, Indian ed-tech giant Think and Learn (which operates under the brand name BYJU's) launched a competitive <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02308250-2A1263430?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">Non-binding Indicative Proposal</a> at an Offer Price of A$1.45/share which was around 7.4% higher than what IXL offered. A few days later, on 17th November 2020, BYJU's <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02310190-2A1264417?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">bumped</a> their bid to A$1.50/share.  </p>
<p>Despite the inclusion of a matching right in the Scheme Implementation Agreement, IXL did not launch a counter proposal and in the IXL scheme meeting held on 20th November 2020, <a href="https://www.smartkarma.com/entities/3p-learning-ltd" target="_blank" data-smartkarma-citation="entities:5708:1" rel="noopener">3P Learning (3PL AU)</a> shareholders categorically <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02311606-2A1265082?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">voted down</a> the IXL Deal.</p>
<p>Furthermore, top shareholder Viburnum Funds, who voted against the IXL Deal, also <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02311624-2A1265085?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">proposed</a> a merger with Blake eLearning. </p>
<p><strong>As 3PL announced <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02312694-2A1265539?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">today</a>, they have now terminated the SIA with IXL and are separately "reviewing and assessing" the remaining two proposals:</strong></p>
<ul>
<li><strong>BYJU's revised all-cash Acquisition Offer at A$1.50 per 3PL share</strong></li>
<li><strong>A merger with Blake eLearning proposed by top shareholder Vibernum Funds </strong></li>
</ul>
<div><p><em>More below the fold. </em></p></div>
<hr>
<div><p><em>For more information about M&amp;A rules, regulations, and practices in Australia, please refer to <a href="https://www.smartkarma.com/insights/quiddity-australia-m-a-guide-2019" target="_blank" data-smartkarma-citation="insights:30118" rel="noopener">Quiddity Australia M&amp;A Guide 2019</a> and <a href="https://www.smartkarma.com/insights/quiddity-m-a-australia-foreign-investment-reforms" target="_blank" data-smartkarma-citation="insights:40210" rel="noopener">Quiddity M&amp;A: Australia Foreign Investment Reforms</a> </em></p></div>
</div>

Previously, on 14th August 2020, 3P Learning (3PL AU) entered into a Scheme Implementation Agreement with privately-owned US-based competitor IXL Learning ("IXL") in an all-cash Deal that valued the company at a market cap of A$189mn (US$137mn). The Offer Price was A$1.35/share and the Target Board unanimously recommended the Deal to the shareholders. 
Until early-October, 3PL shares were trading tight to terms with a view to complete. However, media reports of top shareholder Viburnum Funds turning hostile caused 3PL shares to decline sharply on 7th October 2020.
On 12th November 2020, Indian ed-tech giant Think and Learn (which operates under the brand name BYJU's) launched a competitive Non-binding Indicative Proposal at an Offer Price of A$1.45/share which was around 7.4% higher than what IXL offered. A few days later, on 17th November 2020, BYJU's bumped their bid to A$1.50/share.  
Despite the inclusion of a matching right in the Scheme Implementation Agreement, IXL did not launch a counter proposal and in the IXL scheme meeting held on 20th November 2020, 3P Learning (3PL AU) shareholders categorically voted down the IXL Deal.
Furthermore, top shareholder Viburnum Funds, who voted against the IXL Deal, also proposed a merger with Blake eLearning. 
As 3PL announced today, they have now terminated the SIA with IXL and are separately "reviewing and assessing" the remaining two proposals:

BYJU's revised all-cash Acquisition Offer at A$1.50 per 3PL share
A merger with Blake eLearning proposed by top shareholder Vibernum Funds 

More below the fold. 

For more information about M&amp;A rules, regulations, and practices in Australia, please refer to Quiddity Australia M&amp;A Guide 2019 and Quiddity M&amp;A: Australia Foreign Investment Reforms 


3P Learning (3PL AU): Ed-Tech Deal Faces a New Twist