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

Quiddity Advisors

Event-Driven

On the 14th March 2019, Australian property developer, <a href="https://www.smartkarma.com/entities/1771" target="_blank" data-smartkarma-citation="entities:1771:1">Villa World Ltd (VLW AU)</a> <a href="https://www.asx.com.au/asxpdf/20190314/pdf/443h7sw2498dvl.pdf" target="_blank" data-saferedirecturl="https://www.google.com/url?q=https://www.asx.com.au/asxpdf/20190314/pdf/443h7sw2498dvl.pdf&amp;source=gmail&amp;ust=1552962168274000&amp;usg=AFQjCNG0RvsgZHE2-rlPDWMKhIl_ucl33g">announced</a> that it had received an unsolicited proposal, by way of a scheme, from AVID Property Group Australia at an offer price A$2.23, or a 12% premium to last close. 
The offer is conditional on due diligence, unanimous approval of VLW's board of directors and the receipt of FIRB and other regulatory approvals.
AVID's indicative offer translates to an LTM PER and P/B of 6.4x and 0.9x, with the P/B metric roughly in line peers.
During 2018, VLW's share price declined by 36% to A$1.76 from A$2.77, with a large chunk of that downward move occurring in December after VLW <a href="https://www.asx.com.au/asxpdf/20181214/pdf/441739f18wjlxh.pdf" target="_blank">withdrew</a> its FY19E earnings guidance. That forecast withdrawal was exacerbated by the fact VLW had maintained the 2019 forward guidance at its mid-November AGM.
<a href="https://www.smartkarma.com/entities/18298" target="_blank" data-smartkarma-citation="entities:18298:1">Ho Bee Land Ltd (HOBEE SP)</a>, VLW's largest shareholder and JV partner, responded to AVID's proposal by <a href="https://www.asx.com.au/asxpdf/20190318/pdf/443l6q3xn18719.pdf" target="_blank">buying</a> 2.2mn shares (~1.8% of shares out) at an average of A$1.95/share - and a high of A$2.18/share - lifting its stake to 9.41%. Its stake in VLW accounts for only 1.5% of its market cap. I would not be surprised if Ho Bee is still buying in the market.
VLW announced a <a href="https://www.villaworld.com.au/sites/default/files/ASX_Announcements/4.%20Half%20Year%20Results_1.pdf" target="_blank">1H19 NPAT</a> of A$17.6mn ($17.3mn) last month - slightly above its $16mn to $17mn guidance - and declared a A$0.08/share franked dividend. Assuming FY19E profit of $27mn, VLW is trading at a not unreasonable 10x PER and an attractive 7.3% yield, one of the highest yields among its peer group, assuming the high-end of the 50-75% payout ratio policy.

On the 14th March 2019, Australian property developer, Villa World Ltd (VLW AU) announced that it had received an unsolicited proposal, by way of a scheme, from AVID Property Group Australia at an offer price A$2.23, or a 12% premium to last close. 
The offer is conditional on due diligence, unanimous approval of VLW's board of directors and the receipt of FIRB and other regulatory approvals.
AVID's indicative offer translates to an LTM PER and P/B of 6.4x and 0.9x, with the P/B metric roughly in line peers.
During 2018, VLW's share price declined by 36% to A$1.76 from A$2.77, with a large chunk of that downward move occurring in December after VLW withdrew its FY19E earnings guidance. That forecast withdrawal was exacerbated by the fact VLW had maintained the 2019 forward guidance at its mid-November AGM.
Ho Bee Land Ltd (HOBEE SP), VLW's largest shareholder and JV partner, responded to AVID's proposal by buying 2.2mn shares (~1.8% of shares out) at an average of A$1.95/share - and a high of A$2.18/share - lifting its stake to 9.41%. Its stake in VLW accounts for only 1.5% of its market cap. I would not be surprised if Ho Bee is still buying in the market.
VLW announced a 1H19 NPAT of A$17.6mn ($17.3mn) last month - slightly above its $16mn to $17mn guidance - and declared a A$0.08/share franked dividend. Assuming FY19E profit of $27mn, VLW is trading at a not unreasonable 10x PER and an attractive 7.3% yield, one of the highest yields among its peer group, assuming the high-end of the 50-75% payout ratio policy. 

Ho Bee Ups Stake In Villa World After AVID Lobs An Offer