IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

Arun has over 15 years’ experience covering the Technology sector. During this time, he has worked with technology start-ups and as an equity analyst in investment banks and independent research firms. He was formerly a Technology Analyst for Canaccord Genuity, Altium Securities, Espirito Santo Investment Bank, Noble Group and Clear Capital. He has a dual Master’s degree in Financial Engineering and Industrial and Operations Engineering from the University of Michigan. He obtained his Bachelor’s degree in Mechanical Engineering from the Indian Institute of Technology, Bombay. He is also a CFA charterholder.

IPOs and Catalysts/Events

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Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

Beijing Capital Land Ltd H / Event-Driven

<a href="https://www.smartkarma.com/entities/beijing-capital-land-ltd-h" target="_blank" data-smartkarma-citation="entities:4543:1" rel="noopener">Beijing Capital Land Ltd H (2868 HK)</a>/BCL is one of the leading integrated property developers in China. It focuses on residential property, integrated outlets, urban core complex and primary land development.After market close on Friday, BCL announced pre-conditional privatisation by merger by absorption from Capital Group, the parent company and largest shareholder. The offeror will offer HK$2.80 per H share. The bid represents a premium of 62.79% over the closing price of HK$1.72 per share on the last trading day (7 July 2021 prior to the trading halt). The pre-condition is regulatory approval from the NDRC, MOFCOM, SAFE and if applicable, the SASAC. As the offeror is an SOE, we think that regulatory approvals will be forthcoming. The key condition for the privatisation will be approval by at least 75% independent H-shareholders (&lt;10% of all independent H-shareholders rejection). There is no minimum acceptance condition. Dissenter rights are available. Independent H-shareholders shareholders represent 1,349.9 million shares which are 30.94% of outstanding shares (88.17% of H-shares). Consequently, the 10% blocking stake is 135.0 million shares which are 3.09% of the outstanding shares (8.82% of H-shares). No independent H shareholder holds a blocking stake. <div class="content-highlight">While the implied value of the offer is substantially below book value and unattractive in comparison to long-term historical share prices, it is a material premium to more recent historical share prices and P/B multiples. In combination with no shareholder holding a blocking stake, we think that the privatisation proposal will likely succeed. </div>

Beijing Capital Land Ltd H (2868 HK)/BCL is one of the leading integrated property developers in China. It focuses on residential property, integrated outlets, urban core complex and primary land development.After market close on Friday, BCL announced pre-conditional privatisation by merger by absorption from Capital Group, the parent company and largest shareholder. The offeror will offer HK$2.80 per H share. The bid represents a premium of 62.79% over the closing price of HK$1.72 per share on the last trading day (7 July 2021 prior to the trading halt). The pre-condition is regulatory approval from the NDRC, MOFCOM, SAFE and if applicable, the SASAC. As the offeror is an SOE, we think that regulatory approvals will be forthcoming. The key condition for the privatisation will be approval by at least 75% independent H-shareholders (&lt;10% of all independent H-shareholders rejection). There is no minimum acceptance condition. Dissenter rights are available. Independent H-shareholders shareholders represent 1,349.9 million shares which are 30.94% of outstanding shares (88.17% of H-shares). Consequently, the 10% blocking stake is 135.0 million shares which are 3.09% of the outstanding shares (8.82% of H-shares). No independent H shareholder holds a blocking stake. While the implied value of the offer is substantially below book value and unattractive in comparison to long-term historical share prices, it is a material premium to more recent historical share prices and P/B multiples. In combination with no shareholder holding a blocking stake, we think that the privatisation proposal will likely succeed. 

Beijing Capital Land’s Privatisation Offer from the Parent