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

Taiwan - Pegatron, Yageo, Nanya Tech Shorts Covered

Quiddity Advisors

Event-Driven

<p>Following the <a href="http://newsroom.kemet.com/news-releases/news-release-details/kemet-announces-second-quarter-results" target="_blank" rel="noopener">release</a> of a second-quarter loss of US$15.3mn to September 2019 (against a profit of US$37.1mn a year ago), <a href="https://www.smartkarma.com/entities/kemet-corp" target="_blank" data-smartkarma-citation="entities:26251:1" rel="noopener">KEMET Corp (KEM US)</a> <a href="http://newsroom.kemet.com/news-releases/news-release-details/yageo-acquire-kemet-us2720-share-cash" target="_blank" rel="noopener">announced</a> it has entered into a definitive agreement under which <a href="https://www.smartkarma.com/entities/yageo-corporation" target="_blank" data-smartkarma-citation="entities:13212:1" rel="noopener">Yageo Corporation (2327 TT)</a> will acquire all of the outstanding shares of KEMET for US$ 27.20/share, in cash, for an equity value of ~US$1.64bn.  </p>
<p>The purchase price represents a premium of 18.2% premium to KEMET's last close, a 26% premium to the 30-day VWAP and a 37% premium to the 90-day VWAP. </p>
<p>The transaction is not subject to a financing contingency as Yageo intends to fund the transaction with a combination of cash on hand and committed financing. The deal, which is expected to close in the second half of 2020, is subject to customary closing conditions and the receipt of required regulatory approvals in the US, China, Taiwan and Europe.</p>
<p>In the <a href="https://www.fool.com/earnings/call-transcripts/2019/11/12/kemet-corp-kem-q2-2020-earnings-call-transcript.aspx" target="_blank" rel="noopener">earnings call transcript</a>, KEMET's CEO William Lowe did not expect any particular issues in any particular jurisdiction in regard to the antitrust filings.</p>
<p>The transaction has been unanimously approved by the Boards of Directors of both companies.</p>
<p>Currently trading at a gross/annualised spread of 4.7%/6.7% assuming a relatively conservative July completion. That looks tight for a deal still requiring various antitrust approvals.</p>
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Following the release of a second-quarter loss of US$15.3mn to September 2019 (against a profit of US$37.1mn a year ago), KEMET Corp (KEM US) announced it has entered into a definitive agreement under which Yageo Corporation (2327 TT) will acquire all of the outstanding shares of KEMET for US$ 27.20/share, in cash, for an equity value of ~US$1.64bn.  
The purchase price represents a premium of 18.2% premium to KEMET's last close, a 26% premium to the 30-day VWAP and a 37% premium to the 90-day VWAP. 
The transaction is not subject to a financing contingency as Yageo intends to fund the transaction with a combination of cash on hand and committed financing. The deal, which is expected to close in the second half of 2020, is subject to customary closing conditions and the receipt of required regulatory approvals in the US, China, Taiwan and Europe.
In the earnings call transcript, KEMET's CEO William Lowe did not expect any particular issues in any particular jurisdiction in regard to the antitrust filings.
The transaction has been unanimously approved by the Boards of Directors of both companies.
Currently trading at a gross/annualised spread of 4.7%/6.7% assuming a relatively conservative July completion. That looks tight for a deal still requiring various antitrust approvals.










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