Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

HK Type 4 license through Ballingal Investment Advisors Ltd. 

I'm a highly experienced sell-side analyst with in excess of 22 years of covering Asia Pacific equities, the past 19 years immersed in event strategies encompassing M&A risk arbitrage, directional long/short, stub trades and restructuring.  

My background also includes accountancy (liquidation/bankruptcy/receivership) earlier in my career and as a chief financial officer of a global commodity company based in the US and Mexico.

Pan-Asia Catalysts/Events

Delta's Less-Than-Straightforward Tender Offer

Delta Thailand's Tender Offer: Updated Timetable

Quiddity Advisors

Event-Driven

Delta Electronics Thailand  / Event-Driven

On 1st August 2018, electronics components manufacturer <a href="https://www.smartkarma.com/entities/20912" target="_blank" data-smartkarma-citation="entities:20912:1">Delta Electronics Thai (DELTA TB)</a> ("DET") announced that Delta Electronics International (Singapore) (a wholly-owned subsidiary of <a href="https://www.smartkarma.com/entities/12688" target="_blank" data-smartkarma-citation="entities:12688:1">Delta Electronics (2308 TT)</a>) had made a<a href="http://www.deltathailand.com/imgadmins/press_file/DELTA_press_file_en_2018-08-01_10-59-08.pdf" target="_blank"> conditional voluntary tender offer</a> (CVTO) to acquire 100% of DELTA at Bt71/share, a 1.79% premium to last close (28% above its recent low), in a US$2.1bn deal. Delta currently holds 20.93% in DET.
The CVTO is subject to pre-conditions, including merger control clearance from the US Federal Trade Commission and Antitrust Division of Department of Justice, the European Commission of European Union, and the State Administration for Market Regulation Anti-monopoly Bureau of China. These approvals are expected to be received within 6 months, therefore (potentially) two months from now.  The European Commission's <a href="http://europa.eu/rapid/press-release_MEX-18-6206_en.htm" target="_blank">approval</a> was granted on 24th October.
Delta's decision to buy out the remaining 79.07% of shares out it does not own is a de-risking move in response to the US/China trade war. 35% of Delta's production facilities (from a $ value) are based in China - and 15% of revenue is sourced from the US - whereas 51% of DET's facilities are in Thailand and the US accounts for 28% of revenue. DET has no facilities in China.
To capitalise on Thailand's lower labour costs, DET was established in 1988 as a production base for Delta. The two companies remain close, from an intercompany business point of view, through to management and stakeholders. Because Delta and DET are intertwined - yet there are limited horizontal overlaps and vertical links - the remaining regulatory approvals should not pose a significant risk. 
Currently trading at gross/annualised spread of 3.3%/11.1%, assuming payment in late March.

On 1st August 2018, electronics components manufacturer Delta Electronics Thai (DELTA TB) ("DET") announced that Delta Electronics International (Singapore) (a wholly-owned subsidiary of Delta Electronics (2308 TT)) had made a conditional voluntary tender offer (CVTO) to acquire 100% of DELTA at Bt71/share, a 1.79% premium to last close (28% above its recent low), in a US$2.1bn deal. Delta currently holds 20.93% in DET.
The CVTO is subject to pre-conditions, including merger control clearance from the US Federal Trade Commission and Antitrust Division of Department of Justice, the European Commission of European Union, and the State Administration for Market Regulation Anti-monopoly Bureau of China. These approvals are expected to be received within 6 months, therefore (potentially) two months from now.  The European Commission's approval was granted on 24th October.
Delta's decision to buy out the remaining 79.07% of shares out it does not own is a de-risking move in response to the US/China trade war. 35% of Delta's production facilities (from a $ value) are based in China - and 15% of revenue is sourced from the US - whereas 51% of DET's facilities are in Thailand and the US accounts for 28% of revenue. DET has no facilities in China.
To capitalise on Thailand's lower labour costs, DET was established in 1988 as a production base for Delta. The two companies remain close, from an intercompany business point of view, through to management and stakeholders. Because Delta and DET are intertwined - yet there are limited horizontal overlaps and vertical links - the remaining regulatory approvals should not pose a significant risk. 
Currently trading at gross/annualised spread of 3.3%/11.1%, assuming payment in late March. 

China/US Trade War Spurs Delta To Buy Thai Associate