Merger Arbitrage, Relative Value, Event-Driven

Per Gullberg, CFA, FRM, CAIA

Event-Driven

On 20 Dec, it was reported in the business press that Idemitsu Kosan (5019 JP) is in talks with Showa Shell Sekiyu (5002 JP) regarding a possible buyout of the latter &nbsp;through a Tender Offer Bid. If the transaction eventuates, it may lead to further consolidation among the sector peers. We will be keeping an eye on&nbsp;Cosmo Oil (5007 JP) and &nbsp;TonenGeneral (5012), but also on small-cap Fuji Oil (5017 JP).In this initial insight into the situation, we discuss the Japanese Crude Oil Refinery Sector, and look at recent Japan FTC precedents. We present an estimated timeline, and also look at some of the key risks.

On 20 Dec, it was reported in the business press that Idemitsu Kosan (5019 JP) is in talks with Showa Shell Sekiyu (5002 JP) regarding a possible buyout of the latter &nbsp;through a Tender Offer Bid. If the transaction eventuates, it may lead to further consolidation among the sector peers. We will be keeping an eye on&nbsp;Cosmo Oil (5007 JP) and &nbsp;TonenGeneral (5012), but also on small-cap Fuji Oil (5017 JP).In this initial insight into the situation, we discuss the Japanese Crude Oil Refinery Sector, and look at recent Japan FTC precedents. We present an estimated timeline, and also look at some of the key risks.

Showa Shell in buyout-talks -  Possible USD 4bn deal

Showa Shell Sekiyu Kk

Showa Shell in buyout-talks - Possible USD 4bn deal