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

MBO for Unimat (9707 JP): Deserves a Bump!

Tsukui Holdings (2398) - Another CHEAP Japan Nursing Care Take-Private Deal

Elderly Care TOB Valuations – The Moderate Growth Names

The Amended FamilyMart Document Is A MUST READ For Investor-Stewards

FamilyMart Tender Offer - Winnie and HunnyPot Redux

Quiddity Advisors

Event-Driven

<p><a href="https://www.smartkarma.com/entities/n-field-co-ltd" target="_blank" data-smartkarma-citation="entities:5150:1" rel="noopener">N Field Co Ltd (6077 JP)</a> has seen prodigious growth since its launch in 2003. Founded by then-39-year old Noguchi Kazuteru, who had spent 20 years as a nurse, the company has since its start specialized in home-visit nursing care. The field of nursing is not very well-paid and it is said one only gets to a certain seniority by having worked all three shifts (the day shift, the evening shift, and the overnight shift). </p>
<p>Noguchi-san wanted to build a company where a nurse could have a decent career only working during the day and he founded the company with four other nurses in 2003. Noguchi-san had been working in the field of taking care of psychiatric patients so he thought that N Field could specialize in the outpatient nursing care of psychiatric and mental health patients who need assistance to continue treatment at home. </p>
<p>In the 15th year of business (2017), the company reached ¥8.0bn of revenues, with revenues growing no less than 25%yoy in <em>any</em> of the previous 10 years (revenue was ¥480mm in 2009). Three years later in 2020, revenues were 46% higher. Top line growth seems expected to slow further the next couple of years, but it is not clear it needs to.</p>
<p>The company was listed on TSE Mothers in August 2013 and moved to TSE First Section in 2015. IN 2016, Noguchi-san gave up the role of CEO, passing it on to Takagi-san, who then passed it to Matayoshi-san in 2017, and the CEO is now Kubo-san. </p>
<p>N Field has a specialty in outpatient nursing in the psychiatric and mental health fields. This is a growing field, and the company is growing quickly within the growing field. The company has become more efficient than ever as far as I can tell, and I expect that the company can grow organically for decades to come. </p>
<h3>The NEW News</h3>
<p>Unison Capital has announced a Tender Offer to buy out the company at ¥1,200/share. This is below where the stock spent the five years from early 2014 to late 2018 when revenue growth slowed faster-than-expected.</p>
<p>There are a lot of investors who bought the stock at well above the Tender Offer Price but when the shares dropped through this Tender Offer Price on the way down in the last week of November 2018, they did not stop there. They fell to half that by late Q3 2019. Then in the covid-crash they fell further. The question is whether the shareholders who bought for growth give up here, or not.</p>
<p>This is an interesting deal. </p>
<div>
<p>I am reminded of the last words (the last line below) of Mr. Partridge ("Old Turkey") in Edwin Lefèvre's <em>Reminiscences of a Stock Operator</em> after he had purchased a stock on the urging of a tipster, and the tipster proposed he sell the shares on a bounce, hoping for a "reaction" on which to buy them... </p>
</div>
<div>
<blockquote>
<p>"I couldn’t think of selling that stock.” </p>
<p>“You couldn’t?” asked Elmer, beginning to look doubtful himself. It is a habit with most tip givers to be tip takers. “Why not?” And Elmer drew nearer.</p>
<p>“Why, this is a bull market!” The old fellow said it as though he had given a long and detailed explanation.</p>
<p>“That’s all right,” said Elmer, looking angry because of his disappointment. “I know this is a bull market as well as you do. But you’d better slip them that stock of yours and buy it back on the reaction. You might as well reduce the cost to yourself.”</p>
<p><strong>“My dear boy,” said old Partridge, in great distress “my dear boy, if I sold that stock now I’d lose my position; and then where would I be?”</strong></p>
</blockquote>
</div>
<div>
<p>With a stock growing top line 10+% and OP in the teens to 20+% with what appear to be blue-sky ahead of them (and what I see as a possibility that Japan will be willing to import nursing talent at lower-than-Japan cost), this could easily be seen as a position that the proverbial Mr Partridge would not want to sell. </p>
<p>More below.</p>
</div>

N Field Co Ltd (6077 JP) has seen prodigious growth since its launch in 2003. Founded by then-39-year old Noguchi Kazuteru, who had spent 20 years as a nurse, the company has since its start specialized in home-visit nursing care. The field of nursing is not very well-paid and it is said one only gets to a certain seniority by having worked all three shifts (the day shift, the evening shift, and the overnight shift). 
Noguchi-san wanted to build a company where a nurse could have a decent career only working during the day and he founded the company with four other nurses in 2003. Noguchi-san had been working in the field of taking care of psychiatric patients so he thought that N Field could specialize in the outpatient nursing care of psychiatric and mental health patients who need assistance to continue treatment at home. 
In the 15th year of business (2017), the company reached ¥8.0bn of revenues, with revenues growing no less than 25%yoy in any of the previous 10 years (revenue was ¥480mm in 2009). Three years later in 2020, revenues were 46% higher. Top line growth seems expected to slow further the next couple of years, but it is not clear it needs to.
The company was listed on TSE Mothers in August 2013 and moved to TSE First Section in 2015. IN 2016, Noguchi-san gave up the role of CEO, passing it on to Takagi-san, who then passed it to Matayoshi-san in 2017, and the CEO is now Kubo-san. 
N Field has a specialty in outpatient nursing in the psychiatric and mental health fields. This is a growing field, and the company is growing quickly within the growing field. The company has become more efficient than ever as far as I can tell, and I expect that the company can grow organically for decades to come. 
The NEW News
Unison Capital has announced a Tender Offer to buy out the company at ¥1,200/share. This is below where the stock spent the five years from early 2014 to late 2018 when revenue growth slowed faster-than-expected.
There are a lot of investors who bought the stock at well above the Tender Offer Price but when the shares dropped through this Tender Offer Price on the way down in the last week of November 2018, they did not stop there. They fell to half that by late Q3 2019. Then in the covid-crash they fell further. The question is whether the shareholders who bought for growth give up here, or not.
This is an interesting deal. 

I am reminded of the last words (the last line below) of Mr. Partridge ("Old Turkey") in Edwin Lefèvre's Reminiscences of a Stock Operator after he had purchased a stock on the urging of a tipster, and the tipster proposed he sell the shares on a bounce, hoping for a "reaction" on which to buy them... 



"I couldn’t think of selling that stock.” 
“You couldn’t?” asked Elmer, beginning to look doubtful himself. It is a habit with most tip givers to be tip takers. “Why not?” And Elmer drew nearer.
“Why, this is a bull market!” The old fellow said it as though he had given a long and detailed explanation.
“That’s all right,” said Elmer, looking angry because of his disappointment. “I know this is a bull market as well as you do. But you’d better slip them that stock of yours and buy it back on the reaction. You might as well reduce the cost to yourself.”
“My dear boy,” said old Partridge, in great distress “my dear boy, if I sold that stock now I’d lose my position; and then where would I be?”



With a stock growing top line 10+% and OP in the teens to 20+% with what appear to be blue-sky ahead of them (and what I see as a possibility that Japan will be willing to import nursing talent at lower-than-Japan cost), this could easily be seen as a position that the proverbial Mr Partridge would not want to sell. 
More below.


N Field (6077) Take-Private by Unison Capital - Fast Growth Long Runway Asset Going Not So Rich