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

Chinese Expressways: A Step In The REIT Direction

Qilu Expressway: C-REIT Pilot Or Restructuring?

Quiddity Advisors

Event-Driven

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<p>On the 12 August last year, <a href="https://www.smartkarma.com/entities/qilu-expressway-co-ltd" target="_blank" data-smartkarma-citation="entities:27431:1" rel="noopener">Qilu Expressway Co Ltd (1576 HK)</a> <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0812/2020081201368.pdf" target="_blank" rel="noopener">announced</a> its largest shareholder Qilu Transportation would be merged and absorbed by Shandong Hi-Speed Group (SHSG). The absorption simplified the holdings of Shandong SASAC, the ultimate parent of both Qilu Transportation and SHSG, into Qilu.</p>
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<p>The restructuring triggered an obligation for SHSG to make a mandatory general offer for all shares not owned, and SHSG and Qilu Transportation jointly made an application to the SFC to waive this obligation, which was granted on the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0821/2020082100191.pdf" target="_blank" rel="noopener">20 August</a>. </p>
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<p>There was also the issue over the resulting free float, as the public float would fall below the minimum prescribed percentage of 25% under the restructuring. The restructuring was completed on the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/1117/2020111700550.pdf" target="_blank" rel="noopener">17 November</a> and an application for a  "<em>waiver from strict compliance</em>" with the public float was concurrently lodged, and subsequently granted on the 20 November, with an <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0504/2021050400876.pdf" target="_blank" rel="noopener">extension granted</a> to the 30 June 2021 in which to comply.</p>
<h3>The New News</h3>
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<p>Qilu has now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0513/2021051300351.pdf" target="_blank" rel="noopener">announced</a> SHSG  plans to inject 778.5mn domestics shares, or 38.93% of Qilu, into Shandong Hi-Speed, an entity 70.91% controlled by SHSG.</p>
<p>The completion of this restructuring also triggers an MGO - unless a waiver is granted. </p>
<p>This all looks like history repeating itself. Don't expect an MGO to unfold.</p>
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<p>More below the fold.</p>
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On the 12 August last year, Qilu Expressway Co Ltd (1576 HK) announced its largest shareholder Qilu Transportation would be merged and absorbed by Shandong Hi-Speed Group (SHSG). The absorption simplified the holdings of Shandong SASAC, the ultimate parent of both Qilu Transportation and SHSG, into Qilu.


The restructuring triggered an obligation for SHSG to make a mandatory general offer for all shares not owned, and SHSG and Qilu Transportation jointly made an application to the SFC to waive this obligation, which was granted on the 20 August. 


There was also the issue over the resulting free float, as the public float would fall below the minimum prescribed percentage of 25% under the restructuring. The restructuring was completed on the 17 November and an application for a  "waiver from strict compliance" with the public float was concurrently lodged, and subsequently granted on the 20 November, with an extension granted to the 30 June 2021 in which to comply.
The New News


Qilu has now announced SHSG  plans to inject 778.5mn domestics shares, or 38.93% of Qilu, into Shandong Hi-Speed, an entity 70.91% controlled by SHSG.
The completion of this restructuring also triggers an MGO - unless a waiver is granted. 
This all looks like history repeating itself. Don't expect an MGO to unfold.


More below the fold.


Qilu Expressway (1576 HK): Deja Vu All Over Again