Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

HK Type 4 license through Ballingal Investment Advisors Ltd. ("BIA" or "BIAL")

BACKGROUND
I have 20+yrs experience in Asia doing alternative strategies (i.e. non-delta1 non long-only) in fixed income, equity derivatives, and activist/catalyst/event-driven and long-short equity strategies with most of that time spent managing money. 

4 years in fixed income macro, 8 years running internal hedge fund and 4yrs investment banking at Citi in Japan, 3 years running an Asia multi-strat portfolio at a hedge fund, 4+yrs as an independent special situations analyst.

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Shenzhen Kondarl Group Co A / Event-Driven

On 16th August, Chinese real estate developer and major shareholder, Kingkey Group, announced an all-cash tender offer to acquire the remaining 28.5% minority shareholders in <a href="https://www.smartkarma.com/entities/shenzhen-kondarl-group-co-a" target="_blank" data-smartkarma-citation="entities:10788:1" rel="noopener">Shenzhen Kondarl Group Co A (000048 CH)</a> at an offer price of CNY18.97 per share. This translates to a deal size of CNY 2.1 billion (~USD290 million). The transaction was approved by the Board of Directors and shareholders of Kingkey Group and the valid period for the tender offer will be from 4 September 2019 to 8 October 2019.The offer price of CNY18.97 translates to a discount of 4.9% to the pre-announcement closing price of CNY19.95 and is 24% below the stock's 52-week high of CNY24.90. At the time of writing, the stock has been trading through terms.The offer follows what appears to be the resolution of a long-standing (five years plus) dispute between major shareholder Kingkey Group and Shenzhen Kondarl's previous management team.  In August 2018, the founder and ex-chairman of Shenzhen Kondarl, Luo Aihua, was detained by the Shenzhen police along with two other directors of the company for allegedly misusing company funds.In connection to this transaction, Kingkey Group also signed an agreement on 15th August 2019 to acquire Shenzhen Huachao Investment Group Co., Ltd., a company 60% owned by Shenzhen Kondarl's founder Luo Aihua and 40% owned by Lu Weimin for consideration of CNY 3.2 billion. Following this, Kingkey group - which had held a direct stake of 41.65% in Shenzhen Kondarl - Group gained an additional indirect stake of 29.85% from the Shenzhen Huachao acquisition. Consequently, Kingkey Group now has a controlling stake of 71.5% in Shenzhen Kondarl Group, which has triggered the offer for the remaining shares.

On 16th August, Chinese real estate developer and major shareholder, Kingkey Group, announced an all-cash tender offer to acquire the remaining 28.5% minority shareholders in Shenzhen Kondarl Group Co A (000048 CH) at an offer price of CNY18.97 per share. This translates to a deal size of CNY 2.1 billion (~USD290 million). The transaction was approved by the Board of Directors and shareholders of Kingkey Group and the valid period for the tender offer will be from 4 September 2019 to 8 October 2019.The offer price of CNY18.97 translates to a discount of 4.9% to the pre-announcement closing price of CNY19.95 and is 24% below the stock's 52-week high of CNY24.90. At the time of writing, the stock has been trading through terms.The offer follows what appears to be the resolution of a long-standing (five years plus) dispute between major shareholder Kingkey Group and Shenzhen Kondarl's previous management team.  In August 2018, the founder and ex-chairman of Shenzhen Kondarl, Luo Aihua, was detained by the Shenzhen police along with two other directors of the company for allegedly misusing company funds.In connection to this transaction, Kingkey Group also signed an agreement on 15th August 2019 to acquire Shenzhen Huachao Investment Group Co., Ltd., a company 60% owned by Shenzhen Kondarl's founder Luo Aihua and 40% owned by Lu Weimin for consideration of CNY 3.2 billion. Following this, Kingkey group - which had held a direct stake of 41.65% in Shenzhen Kondarl - Group gained an additional indirect stake of 29.85% from the Shenzhen Huachao acquisition. Consequently, Kingkey Group now has a controlling stake of 71.5% in Shenzhen Kondarl Group, which has triggered the offer for the remaining shares. 

Management Tussle at Shenzhen Kondarl Leads to Tender To Take Out Minorities