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

Metlifecare/EQT: Avoiding Contractual Obligations

Quiddity Advisors

Event-Driven

On the 24 October, retirement village operator <a href="https://www.smartkarma.com/entities/metlifecare-ltd" target="_blank" data-smartkarma-citation="entities:19219:1" rel="noopener">Metlifecare Ltd (MET NZ)</a> announced an <a href="https://www.nzx.com/announcements/343190" target="_blank" rel="noopener">NZ$30mn share buyback</a> as the board "believed that the share price did not appropriately reflect the fundamentals of the business". Shares closed the previous day at NZ$4.35.
The buyback was <a href="https://www.nzx.com/announcements/344571" target="_blank" rel="noopener">suspended</a> on the 20 November after the MET received a "highly conditional, non-binding preliminary expression of interest".
The interested party was Asia Pacific Village Group Limited, an entity owned by EQT Infrastructure IV fund and managed by Swedish buyout firm EQT Fund Management. EQT's indicative Offer price of $6.50 was enough for MET to provide due diligence, but ultimately was rejected, as $6.50 was considered below MET's internal value, which was deemed to be in excess of $8/share. EQT's Offer also <a href="https://www.nzx.com/announcements/346335" target="_blank" rel="noopener">did not have support</a> from Accident Compensation Corporation, Nikko Asset Management, and Generate.
On the 30 December, MET <a href="https://www.nzx.com/announcements/346608" target="_blank" rel="noopener">entered into</a> a Scheme Implementation Agreement under which EQT has agreed to acquire all MET’s shares for $7.00/share, in an NZ$1.49bn (US$996mn) deal.
The revised Offer price is a 9.7% premium to the then-last close (December 20th), and a 38% premium to the closing price prior to the announcement of the initial offer on November 19.
MET's board unanimously recommends shareholders vote in favour of the transaction, subject to the scheme price being within or above the valuation range specified by an independent adviser, and, in the absence of a superior proposal.
EQT has also entered into a voting deed with MET's largest shareholder, New Zealand Superannuation Fund Nominees Limited (NZSF), which holds 19.86% of MET’s shares.  Under the voting deed, NZSF has agreed to vote in favour of the Scheme subject to certain conditions. 
In addition, certain MET shareholders, collectively holding ~22% of shares out, have indicated to EQT their intention to vote in favour of the Scheme - in the absence of a superior proposal.
The Scheme requires 75% of shareholders voting for the resolution at the Scheme Meeting on the 20 April (tentatively) - it currently has 41.86% in the bag.
This appears a very straightforward arb. Trading tight, at a gross/annualised spread of 1.7%/5.2%, assuming mid-May payment.

On the 24 October, retirement village operator Metlifecare Ltd (MET NZ) announced an NZ$30mn share buyback as the board "believed that the share price did not appropriately reflect the fundamentals of the business". Shares closed the previous day at NZ$4.35.
The buyback was suspended on the 20 November after the MET received a "highly conditional, non-binding preliminary expression of interest".
The interested party was Asia Pacific Village Group Limited, an entity owned by EQT Infrastructure IV fund and managed by Swedish buyout firm EQT Fund Management. EQT's indicative Offer price of $6.50 was enough for MET to provide due diligence, but ultimately was rejected, as $6.50 was considered below MET's internal value, which was deemed to be in excess of $8/share. EQT's Offer also did not have support from Accident Compensation Corporation, Nikko Asset Management, and Generate.
On the 30 December, MET entered into a Scheme Implementation Agreement under which EQT has agreed to acquire all MET’s shares for $7.00/share, in an NZ$1.49bn (US$996mn) deal.
The revised Offer price is a 9.7% premium to the then-last close (December 20th), and a 38% premium to the closing price prior to the announcement of the initial offer on November 19.
MET's board unanimously recommends shareholders vote in favour of the transaction, subject to the scheme price being within or above the valuation range specified by an independent adviser, and, in the absence of a superior proposal.
EQT has also entered into a voting deed with MET's largest shareholder, New Zealand Superannuation Fund Nominees Limited (NZSF), which holds 19.86% of MET’s shares.  Under the voting deed, NZSF has agreed to vote in favour of the Scheme subject to certain conditions. 
In addition, certain MET shareholders, collectively holding ~22% of shares out, have indicated to EQT their intention to vote in favour of the Scheme - in the absence of a superior proposal.
The Scheme requires 75% of shareholders voting for the resolution at the Scheme Meeting on the 20 April (tentatively) - it currently has 41.86% in the bag.
This appears a very straightforward arb. Trading tight, at a gross/annualised spread of 1.7%/5.2%, assuming mid-May payment.

Metlifecare Ltd

Metlifecare: EQT Plans Retirement