Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Highly experienced ex-Delta One trader with 17 years of experience trading arbitrage and related strategies across Asian markets.

Exempt Financial Adviser (EFA) under CrossASEAN Research Pte Ltd.

It is important to note that the information provided by Periscope Analytics is based on publicly available data and own knowledge, which has been gathered and synthesized from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions.

All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include, but are not limited to, company announcements, exchange filings, ETF and other passive investment vehicle holdings, and free float and volume data from third-party data providers. Periscope Analytics does not guarantee the accuracy and completeness of the forecasts, estimates and/or other information.

Pan-Asia Index Rebalances/ Events/ Delta One

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Event-Driven

Post market close yesterday, <a href="https://www.smartkarma.com/entities/japan-post-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:359:1" rel="noopener">Japan Post Holdings (6178 JP)</a> announced that the Ministry of Finance (MOF) would be selling 1,027,477,400 shares of the company to pare their stake to the minimum mandated 33.3%. The sell down is 27% of the company shares and at the last price is worth JPY 952bn (US$8.55bn).<a href="https://www.smartkarma.com/entities/japan-post-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:359:1" rel="noopener">Japan Post Holdings (6178 JP)</a> also announced that they would be buying a maximum of 133m shares or up to JPY 100bn of their own shares following the supply-demand imbalance following the Ministry of Finance's offering.The news of the potential sell down has been swirling for the last week and the stock is down around 7.6% since then. With pricing of the offering to be determined between 25-27 October, the stock should head lower in the near term.The passive buying due to an increase in the free float of the stock, plus the buyback, will support <a href="https://www.smartkarma.com/entities/japan-post-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:359:1" rel="noopener">Japan Post Holdings (6178 JP)</a>. Both events together will mop up between 40-43% of the MOF offering.With the Ministry of Finance holding the minimum mandated stake in the company, the overhang will go away.

Post market close yesterday, Japan Post Holdings (6178 JP) announced that the Ministry of Finance (MOF) would be selling 1,027,477,400 shares of the company to pare their stake to the minimum mandated 33.3%. The sell down is 27% of the company shares and at the last price is worth JPY 952bn (US$8.55bn).Japan Post Holdings (6178 JP) also announced that they would be buying a maximum of 133m shares or up to JPY 100bn of their own shares following the supply-demand imbalance following the Ministry of Finance's offering.The news of the potential sell down has been swirling for the last week and the stock is down around 7.6% since then. With pricing of the offering to be determined between 25-27 October, the stock should head lower in the near term.The passive buying due to an increase in the free float of the stock, plus the buyback, will support Japan Post Holdings (6178 JP). Both events together will mop up between 40-43% of the MOF offering.With the Ministry of Finance holding the minimum mandated stake in the company, the overhang will go away.

Japan Post Holdings (6178 JP): Passive Buying + Buyback Will Mop Up MOF Offering