IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

Arun has over 15 years’ experience covering the Technology sector. During this time, he has worked with technology start-ups and as an equity analyst in investment banks and independent research firms. He was formerly a Technology Analyst for Canaccord Genuity, Altium Securities, Espirito Santo Investment Bank, Noble Group and Clear Capital. He has a dual Master’s degree in Financial Engineering and Industrial and Operations Engineering from the University of Michigan. He obtained his Bachelor’s degree in Mechanical Engineering from the Indian Institute of Technology, Bombay. He is also a CFA charterholder.

IPOs and Catalysts/Events

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Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<p><a href="https://www.smartkarma.com/entities/leyou-technologies-holdings" target="_blank" data-smartkarma-citation="entities:5831:1" rel="noopener">Leyou Technologies (1089 HK)</a>’s long-drawn takeover saga has entered its final act. After market close on Thursday, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a> announced a privatisation offer by way of a scheme of arrangement for Leyou. Tencent will offer HK$3.3219 per scheme share. The bid represents a premium of 30.27% over the closing price of HK$2.5500 per share on the last trading day (19 September 2019) and a premium of 4.46% over the last close price of HK$3.18 per share.</p><p>As a reminder on 10 July, Leyou announced that Mr Yuk, the controlling shareholder, entered into a three months exclusivity agreement with Tencent Mobility, a wholly-owned subsidiary of Tencent, to sell his stake. In <a href="https://www.smartkarma.com/insights/tencent-ending-the-leyou-takeover-saga" target="_blank" rel="noopener">our previous note</a>, we opined that there is a high chance that this takeover saga ends with an agreement between Mr Yuk and Tencent.</p><div class="content-highlight"><p>We think that this is a done deal due to the irrevocables, no other shareholder holding a blocking stake along with the attractive premium to peers multiples and historical VWAPs implied by the privatisation price.   </p></div>

Leyou Technologies (1089 HK)’s long-drawn takeover saga has entered its final act. After market close on Thursday, Tencent Holdings (700 HK) announced a privatisation offer by way of a scheme of arrangement for Leyou. Tencent will offer HK$3.3219 per scheme share. The bid represents a premium of 30.27% over the closing price of HK$2.5500 per share on the last trading day (19 September 2019) and a premium of 4.46% over the last close price of HK$3.18 per share.As a reminder on 10 July, Leyou announced that Mr Yuk, the controlling shareholder, entered into a three months exclusivity agreement with Tencent Mobility, a wholly-owned subsidiary of Tencent, to sell his stake. In our previous note, we opined that there is a high chance that this takeover saga ends with an agreement between Mr Yuk and Tencent.We think that this is a done deal due to the irrevocables, no other shareholder holding a blocking stake along with the attractive premium to peers multiples and historical VWAPs implied by the privatisation price.   

Tencent Launches a Privatisation Bid for Leyou