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

Thoughts on Amazon –What Does Its Valuation Tells Us?

Netflix & Amazon Expand in Korea – Not a Coincidence

Okja: The Fight Between Netflix Vs. CJ CGV

Quiddity Advisors

Event-Driven

Coming with a <a href="https://www.smartkarma.com/entities/sony-corp" target="_blank" data-smartkarma-citation="entities:563:1" rel="noopener">Sony Corp (6758 JP)</a><a href="https://www.sony.net/SonyInfo/IR/library/presen/strategy/" target="_blank" rel="noopener">Corporate Strategy Meeting</a>, there was an announcement of a couple of <a href="https://www.sony.net/SonyInfo/News/Press/202005/20-040E/" target="_blank" rel="noopener">Executive Changes</a> based on a <a href="https://www.sony.net/SonyInfo/News/Press/202005/20-039E/" target="_blank" rel="noopener">New Organizational Structure</a> which, for strategic reasons, means that Sony is obliged to announce a Tender Offer to take full control of <a href="https://www.smartkarma.com/entities/sony-financial-holdings-inc" target="_blank" data-smartkarma-citation="entities:564:1" rel="noopener">Sony Financial Holdings (8729 JP)</a>.So.... Sony takes out Sony Financial. This is an event which special situations investors/analysts/traders have speculated on for years, but this takeover is extremely opportunistic.Today's <a href="https://www.sony.net/SonyInfo/IR/news/20200519_02E.pdf" target="_blank" rel="noopener">announcement</a> is the functional equivalent of a 'Dear John' letter to Sony Financial shareholders.<blockquote>
It's not you - it's me. 
And I want to be fair. 
If there's anything else, please talk to my lawyer. 
</blockquote>To be sure, that is not an actual quote from Sony but it might as well be. Takeout price?    It's at a....    [checks notes]...  three month high? For a cash takeover? Surely you must be joking. Don't read the Tender Offer document. It will just get you upset.The Tender Offer Price is 30% higher than the first offer made by Sony. And Sony made the approach with a share exchange proposal, when the SFH/Sony share price ratio was at the lowest level since SFH was listed. Minority protections like Majority of Minority? Nope. Minimum hurdle?  1.6% of shareholders must tender to make it successful. Post-deal recourse? Not much. Shareholder appraisal rights are effectively impaired since the JCOM decision. This is one of the GREAT failings of experts, authorities, and the Court. Is there a chance upset shareholders could block this? There is a theoretical chance, but it is, in my opinion, improbable in the extreme.<hr>This is going to make some people unhappy. This will go down in the books as a situation where SONY parent should have done better. My constant refrain to shareholders in Japan is...<div class="content-highlight">
If you want takeover prices for minorities to be anywhere near appropriate, you need to make yourself heard. 
"The Rules" enable and support management and incumbent/insider abuse of minorities. 
Demand reasonable, fair, and global standard treatment from your independent directors. Make it known to the parent in situations where the shareholder structure allows abuse that you will exercise your rights where and how necessary. 
</div>In the meantime, we have a risk arb situation to trade...

Coming with a Sony Corp (6758 JP)Corporate Strategy Meeting, there was an announcement of a couple of Executive Changes based on a New Organizational Structure which, for strategic reasons, means that Sony is obliged to announce a Tender Offer to take full control of Sony Financial Holdings (8729 JP).So.... Sony takes out Sony Financial. This is an event which special situations investors/analysts/traders have speculated on for years, but this takeover is extremely opportunistic.Today's announcement is the functional equivalent of a 'Dear John' letter to Sony Financial shareholders.
It's not you - it's me. 
And I want to be fair. 
If there's anything else, please talk to my lawyer. 
To be sure, that is not an actual quote from Sony but it might as well be. Takeout price?    It's at a....    [checks notes]...  three month high? For a cash takeover? Surely you must be joking. Don't read the Tender Offer document. It will just get you upset.The Tender Offer Price is 30% higher than the first offer made by Sony. And Sony made the approach with a share exchange proposal, when the SFH/Sony share price ratio was at the lowest level since SFH was listed. Minority protections like Majority of Minority? Nope. Minimum hurdle?  1.6% of shareholders must tender to make it successful. Post-deal recourse? Not much. Shareholder appraisal rights are effectively impaired since the JCOM decision. This is one of the GREAT failings of experts, authorities, and the Court. Is there a chance upset shareholders could block this? There is a theoretical chance, but it is, in my opinion, improbable in the extreme.This is going to make some people unhappy. This will go down in the books as a situation where SONY parent should have done better. My constant refrain to shareholders in Japan is...
If you want takeover prices for minorities to be anywhere near appropriate, you need to make yourself heard. 
"The Rules" enable and support management and incumbent/insider abuse of minorities. 
Demand reasonable, fair, and global standard treatment from your independent directors. Make it known to the parent in situations where the shareholder structure allows abuse that you will exercise your rights where and how necessary. 
In the meantime, we have a risk arb situation to trade...

Sony FINALLY Takes Out Sony Financial in Tender Offer