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

Oriental Watch: Forget the Tender, Management Is Bullish and Dividends to Accelerate

Oriental Watch Gap Support and Then Higher

1H21 Shows 108% Sales Growth in China; Bottom Line Hit by Higher Tax; Cash 70% of Market Cap

Quiddity Advisors

Event-Driven

<div>
<p>After <a href="https://www.smartkarma.com/entities/oriental-watch-holdings" target="_blank" data-smartkarma-citation="entities:19950:1" rel="noopener">Oriental Watch (398 HK)</a> ("OWH") was <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0831/2020083100161.pdf" target="_blank" rel="noopener">suspended</a> <em>"pursuant to the Codes on Takeovers and Mergers and Share Buy-backs</em>", the immediate takeaway was to conclude the company would be subject to a Privatization Offer. But in what is becoming increasingly more common, OWH has announced a <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0914/2020091400003.pdf" target="_blank" rel="noopener">partial buyback</a> from the company - 14.55% of shares out or 83mn shares, at HK$3.00/share, a 53.85% premium to last close.</p>
</div>
<div>
<p>This will cost the company HK$0.25bn (US$32mn). OWH had net cash on hand of ~HK$0.65bn as at Mar 2020.</p>
</div>
<div>
<p>Yeung Ming Biu &amp; concert parties hold 30.85% of shares out and will not tender. That leaves 69.15% of the register subject to the buyback, implying a minimum pro-ration of 21.04%.</p>
</div>
<div>
<p>Should the partial buyback complete (i.e. fully exercised) Yeung &amp; concert parties will hold 36.10% of shares out, before the exercise of any outstanding share options. That step-up in %-held oversteps Hong Kong's "creeper rule", and therefore Independent Shareholders are required, by way of a special resolution (75% vote), to approve a whitewash waiver such that Wong is not obligated to make a general offer for shares not held. </p>
</div>
<div>
<p>As always, more below the fold. Plus<em><strong> Ye Olde Arb Grids</strong></em>.  </p>
</div>


After Oriental Watch (398 HK) ("OWH") was suspended "pursuant to the Codes on Takeovers and Mergers and Share Buy-backs", the immediate takeaway was to conclude the company would be subject to a Privatization Offer. But in what is becoming increasingly more common, OWH has announced a partial buyback from the company - 14.55% of shares out or 83mn shares, at HK$3.00/share, a 53.85% premium to last close.


This will cost the company HK$0.25bn (US$32mn). OWH had net cash on hand of ~HK$0.65bn as at Mar 2020.


Yeung Ming Biu &amp; concert parties hold 30.85% of shares out and will not tender. That leaves 69.15% of the register subject to the buyback, implying a minimum pro-ration of 21.04%.


Should the partial buyback complete (i.e. fully exercised) Yeung &amp; concert parties will hold 36.10% of shares out, before the exercise of any outstanding share options. That step-up in %-held oversteps Hong Kong's "creeper rule", and therefore Independent Shareholders are required, by way of a special resolution (75% vote), to approve a whitewash waiver such that Wong is not obligated to make a general offer for shares not held. 


As always, more below the fold. Plus Ye Olde Arb Grids.  


Oriental Watch (398 HK): Conditional Partial Offer