Things are rather quiet on the M&A front.
Market this year has been dominated again by action/speeches by central banks/fed.
Japan was particularly interesting with a meteoric rise from Dec till May. Although it came back a in the last week of May.
I believe the rise in indices around the world would continue into the 2nd half of the year, thus making Merger Arb strategies look less interesting.
Hopefully closer towards the end of third quarter, confidence will return to corporations to chart their growth through M&A actions (from an Asian markets perspective)
Tuesday, June 4, 2013
The End for Billabong?
Australian surfwear company Billabong International Ltd issued its third profit warning in six months as it revealed that potential takeover suitors had walked away from a deal.
Friday, March 8, 2013
Dell Privatization deal opposed by Carl Icahn
Activist investor Carl Icahn has taken a large stake in Dell in a move to get a large cash payout from the struggling PC maker.
Carl Icahn in renown for such actions, where he will buy a large enough stake to influence the boards decision or start a proxy battle. His infamous trophies includes Motorola, RJR Nabisco, Time Warner and etc..
It always interest me when Carl is mentioned as it always involves a longer saga that will unfold.
I am not advocating that anyone buy Dell shares or short Dell shares but just to sit on the sidelines and enjoy watching Mr Icahn make Mr Dell sweat before coming to terms with Mr Icahn.
If you feel you have to take a position, I would favor running alongside Mr Icahn than Mr Dell.
Carl Icahn in renown for such actions, where he will buy a large enough stake to influence the boards decision or start a proxy battle. His infamous trophies includes Motorola, RJR Nabisco, Time Warner and etc..
It always interest me when Carl is mentioned as it always involves a longer saga that will unfold.
I am not advocating that anyone buy Dell shares or short Dell shares but just to sit on the sidelines and enjoy watching Mr Icahn make Mr Dell sweat before coming to terms with Mr Icahn.
If you feel you have to take a position, I would favor running alongside Mr Icahn than Mr Dell.
Saturday, March 2, 2013
Chinese sovereign wealth backs Talison takeover in Australia
Author: Kip Keen
Posted: Monday , 25 Feb 2013
Posted: Monday , 25 Feb 2013
HALIFAX, NS (MINEWEB) -
China Investment Corporation, a Chinese sovereign fund that boasts around $500 billion in assets, threw its weight behind Chengdu Tianqi’s $847-million takeover of Talison Lithium, a major lithium miner listed in Canada and Australia.
The massive sovereign wealth fund is to buy a 35-percent stake in Chengdu Tianqi’s Australian subsidiary, Windfield Holdings, for $300 million, providing nearly half the remaining funds Chengdu Tianqi, a lithium processor, needs to takeover Talison through Windfield.
The other half, according to press releases issued by Chengdu Tianqi and Talison on Monday, is to come from three sources: Credit Suisse AG, the Industrial and Commercial Bank of China and Twenty Two Dragons. Chengdu Tianqi said each of these firms had respectively promised $200 million, $120 million and $50 million in loans to back the takeover.
As it already owns 19.9 percent of Talison, Chengdu Tianqi said the $670 million in funding commitments would completely cover its $7.50-a-share cash offer to Talison shareholders.
The massive sovereign wealth fund is to buy a 35-percent stake in Chengdu Tianqi’s Australian subsidiary, Windfield Holdings, for $300 million, providing nearly half the remaining funds Chengdu Tianqi, a lithium processor, needs to takeover Talison through Windfield.
The other half, according to press releases issued by Chengdu Tianqi and Talison on Monday, is to come from three sources: Credit Suisse AG, the Industrial and Commercial Bank of China and Twenty Two Dragons. Chengdu Tianqi said each of these firms had respectively promised $200 million, $120 million and $50 million in loans to back the takeover.
As it already owns 19.9 percent of Talison, Chengdu Tianqi said the $670 million in funding commitments would completely cover its $7.50-a-share cash offer to Talison shareholders.
In showing its specific funding plans, Chengdu Tianqi satisfied a critical term in the ongoing takeover. Talison had set 5 PM (WST), February 25, as a deadline for Chengdu Tianqi to show it more details on how it proposed to fund the takeover.
Talison, which owns the Greenbushes lithium mine in Australia, said on Monday that it confirms “Tianqi has provided the necessary documentary evidence in connection with its funding arrangements.”
Meantime the window of opportunity for Rockwood Holdings to jump back into the fray appears to be narrowing.
Last year Chengdu Tianqi outbid Rockwood for Talison, but then, as reported by Mineweb, it emerged earlier this month that Rockwood still had its eyes on the Talison. Rockwood Chairman and CEO Seifi Ghasemi said it had yet to rededicate funds it had set aside for the failed Talison bid in case Chengdu Tianqi’s takeover failed.
If it did fail, then Ghasemi said Rockwood would consider going after Talison again.
Presumably Rockwood will now have its eyes fixed to the next critical deadline Talison has given Chengdu Tianqi: March 26. By the end of this business day Chengdu Tianqi is to have all funds on deposit for the takeover.
Talison, which owns the Greenbushes lithium mine in Australia, said on Monday that it confirms “Tianqi has provided the necessary documentary evidence in connection with its funding arrangements.”
Meantime the window of opportunity for Rockwood Holdings to jump back into the fray appears to be narrowing.
Last year Chengdu Tianqi outbid Rockwood for Talison, but then, as reported by Mineweb, it emerged earlier this month that Rockwood still had its eyes on the Talison. Rockwood Chairman and CEO Seifi Ghasemi said it had yet to rededicate funds it had set aside for the failed Talison bid in case Chengdu Tianqi’s takeover failed.
If it did fail, then Ghasemi said Rockwood would consider going after Talison again.
Presumably Rockwood will now have its eyes fixed to the next critical deadline Talison has given Chengdu Tianqi: March 26. By the end of this business day Chengdu Tianqi is to have all funds on deposit for the takeover.
Friday, February 15, 2013
WBL takeover: IFA rejects Straits Trading's offer
The independent financial adviser (IFA) to the takeover of WBL Corporation, KPMG Corporate Finance, has rejected Straits Trading Company's offer as "not fair from a financial point of view".
In a letter to WBL independent directors on Feb 13, KPMG said it has evaluated Straits Trading's S$3.36 a share cash offer or share swap offer of 1.0543 new Straits Trading shares per WBL share after considering various factors, such as WBL's sum of the parts valuation and comparison of the offer to WBL's average price and premiums or discounts of precedent takeovers.
Accordingly, WBL's independent directors has also advised stockholders and convertible bondholders to reject Straits Trading's offer.
WBL, a technology, motor and property group, is being courted by both Straits Trading and United Engineers. UE said it intends to offer S$4 a share for WBL late last month.
Above taken from The Business Times. Article by Cai HaoXiang
Monday, February 4, 2013
Thai tycoon takes majority control of Singapore's F&N
SINGAPORE: A Thai tycoon has clinched majority control of Singapore conglomerate Fraser and Neave (F&N), making his offer to fully takeover the company unconditional.
TCC Assets, owned by Thai billionaire Charoen Sirivadhanabhakdi, said in a statement late Wednesday that its stake in F&N stands at 50.92 per cent after further purchases in the stock market and more shareholders accepting its offer.
With majority control now in the hands of the Thai parties, "accordingly, the F&N offer has become unconditional in all respects," the statement added.
TCC Assets is offering to buy F&N shares it does not already own at S$9.55 apiece, valuing the drinks, property and publishing conglomerate at S$13.75 billion.
The deadline for the rest of the shareholders to accept the offer was extended from February 4 to February 18, according to the statement.
Indonesia-led property firm Overseas Union Enterprise (OUE) averted a bidding war earlier this month when it declined to match the offer by the Thais. OUE is linked to Indonesian tycoon Mochtar Riady.
The takeover is said to be the biggest in Singapore's corporate history if it pushes through.
F&N became a takeover target after it sold off its most prized asset, Tiger Beer maker Asia Pacific Breweries, to Dutch giant Heineken in September.
It still has lucrative beverages, property and publishing operations.
Analysts believe more shareholders are likely to accept the offer as it is the only bid on the table.
The market however is closely watching whether Japanese brewer Kirin, which holds a 15 per cent stake in F&N, will sell its interests or remain a minority shareholder.
Kirin had allied itself with OUE in the bidding war. Its 15 per cent stake is worth more than S$2.0 billion at the rate offered by TCC Assets.
Charoen's TCC Group has a real estate unit, and the tycoon also owns Thai Beverage, which sells Chang beer
- AFP/jc
TCC Assets, owned by Thai billionaire Charoen Sirivadhanabhakdi, said in a statement late Wednesday that its stake in F&N stands at 50.92 per cent after further purchases in the stock market and more shareholders accepting its offer.
With majority control now in the hands of the Thai parties, "accordingly, the F&N offer has become unconditional in all respects," the statement added.
TCC Assets is offering to buy F&N shares it does not already own at S$9.55 apiece, valuing the drinks, property and publishing conglomerate at S$13.75 billion.
The deadline for the rest of the shareholders to accept the offer was extended from February 4 to February 18, according to the statement.
Indonesia-led property firm Overseas Union Enterprise (OUE) averted a bidding war earlier this month when it declined to match the offer by the Thais. OUE is linked to Indonesian tycoon Mochtar Riady.
The takeover is said to be the biggest in Singapore's corporate history if it pushes through.
F&N became a takeover target after it sold off its most prized asset, Tiger Beer maker Asia Pacific Breweries, to Dutch giant Heineken in September.
It still has lucrative beverages, property and publishing operations.
Analysts believe more shareholders are likely to accept the offer as it is the only bid on the table.
The market however is closely watching whether Japanese brewer Kirin, which holds a 15 per cent stake in F&N, will sell its interests or remain a minority shareholder.
Kirin had allied itself with OUE in the bidding war. Its 15 per cent stake is worth more than S$2.0 billion at the rate offered by TCC Assets.
Charoen's TCC Group has a real estate unit, and the tycoon also owns Thai Beverage, which sells Chang beer
- AFP/jc
Singapore Takeover : WBL by UE
by Cheryl Tay
United Engineers Limited (UE), through its subsidiary UE Centennial Venture Pte Ltd, plans to launch an all-cash pre-conditional voluntary general offer to takeover WBL Corporation Limited (WBL) at S$4.00 per share.
"UE has been exploring opportunities to make a substantial acquisition that will be transformational in nature. We believe that WBL will give us the scale and scope, as well as the geographic diversification, to achieve our strategic ambition," said Jackson Yap, Group Managing Director and CEO of UE.
The offer, which values WBL at around S$1.1 billion, is for the "remaining 61.7 percent of WBL, or 167.6 million shares, and all outstanding convertible bonds in WBL" that are not owned by UE Centennial Venture and its concert parties.
Owning 38.3 percent interest in WBL, the involved parties comprise the Great Eastern Group, the OCBC Bank Group, the Lee Group and the directors of UE Centennial Venture.
Meanwhile, the offer price "is at a 19.0 percent premium to a competing cash offer (adjusted for dividend)" and represents a "14.0 percent, 13.3 percent and 12.0 percent premium to the last transacted price on 23 November 2012, one-month volume weighted average price (VWAP) and three-month VWAP up to 23 November 2012, respectively."
As a major transaction under Chapter 10 of the SGX-ST's Listing Manual, the offer is subject to the approval of UE shareholders at an extraordinary general meeting to be held on 31 May 2013.Cheryl Tay, Editor of CommericalGuru, wrote this story. To contact her about this or other stories, email cheryltay@allproperty.com.sg Related Stories:2012 a record investment year for SingaporeKeppel REIT to acquire 50% interest in Perth office towerChangi Road office building up for tender
Monday, January 21, 2013
TCC raises offer for F&N
SINGAPORE: TCC Assets, the company owned by Thai tycoon Charoen Sirivadhanabhakdi, has raised its stake in food and beverage conglomerate Fraser & Neave (F&N). In a statement on Sunday, TCC Assets said it has acquired another 2.2 million shares of F&N at S$9.55 a piece on January 19. This raised the combined shareholdings of TCC Assets and Thai Beverage to 40.09 per cent in F&N. Currently, the latest level of acceptances for the Thai's offer amounts to 0.52 per cent as at January 18.
The latest acquisition came just after the Thai businessman, through his companies TCC Assets and Thai Beverage, raised his takeover bid for F&N to S$9.55 per share. That is 7.5 per cent or 67 cents higher than his previous bid of S$8.88 per share. The move propels TCC assets to front-runner in the drawn-out takeover battle, trumping rival bidder Overseas Union Enterprise which has offered S$9.08 per share.
The latest acquisition came just after the Thai businessman, through his companies TCC Assets and Thai Beverage, raised his takeover bid for F&N to S$9.55 per share. That is 7.5 per cent or 67 cents higher than his previous bid of S$8.88 per share. The move propels TCC assets to front-runner in the drawn-out takeover battle, trumping rival bidder Overseas Union Enterprise which has offered S$9.08 per share.
ChannelNewsAsia.
Tuesday, January 15, 2013
OUE extends F&N bid to 21st Jan 2013
The showdown date to see if any party puts in a higher bid to secure the shares they need.
Hong Financial Group to take over its subsidiary
KUALA LUMPUR: Hong Leong Financial Group Bhd (HLFG) has launched a conditional voluntary takeover offer to acquire all the shares not already owned by them in Hong Leong Capital Bhd (Hong Leong Cap) at cash offer price RM1.71 per share.
The offer price works out to a 20.4% premium over Hong Leong Cap's last traded price of RM1.42 per share before it was suspended last Friday.
HLFG currently owns 79.1% or 195.3 million shares in Hong Leong Cap.
“HLFG does not intend to maintain the listing status of Hong Leong Cap and does not have intention to undertake any steps to address the shortfall in its public shareholding spread requirement,” said the notice of the takeover.
It is understood that this exercise is part of the group restructuring that should reduce the number of the listed financial entities under the Hong Leong umbrella and also see the investment bank, which is currently parked under Hong Leong Cap into Hong Leong Bank Bhd.
The Star Online
Billabong. Alternative proposal.
Another non-binding proposal at the same price of $1.10
From a private equity and clothing company based in US
Re-iterate getting out of the position.
From a private equity and clothing company based in US
Re-iterate getting out of the position.
Tuesday, January 8, 2013
US hedge fund places bet on F&N
Davidson Kempner buys S$610m in shares to raise F&N stake to just under 5%: Sources
08:51 AM Jan 08, 2013
SINGAPORE - A United States hedge fund giant has placed a bold US$500 million (S$610.4 million) bet to profit from a battle between two Asian tycoons for Singapore property and drinks conglomerate Fraser & Neave (F&N).
Davidson Kempner Capital Management has bought a good chunk of F&N shares since a consortium led by Indonesian tycoon Stephen Riady's Overseas Union Enterprise (OUE) launched a S$13.1-billion counter-bid for F&N in November. That offer surpassed an earlier one by Thai beer baron Charoen Sirivadhanabhakdi.
Davidson Kempner's role in the F&N saga is unusual for its size and because one of the bidders, in addition to attempting to buy out the company, is trying to increase its shareholding. At least one instance has emerged in which the Thai group has offered to buy F&N shares from existing shareholders and has been rebuffed - fuelling investor expectations of higher bids and buoying F&N's stock.
The New York-based hedge fund, which manages US$19 billion, has raised its F&N stake to just under 5 per cent since November, two sources with direct knowledge of the matter said.
That compares with less than 1 per cent before the Thai takeover interest in July last year, said one of the sources, who declined to be identified.
"That is an elephant, both in terms of the size of the fund that can and should take it and relative to Asian capital markets," said Mr Peter Douglas, founder of Singapore-based hedge fund consultancy GFIA.
Multi-strategy hedge funds like Davidson Kempner invest money in different ways, including betting on the success or failure of an acquisition offer for a public company - a tactic known as merger arbitrage, or "arb" trading.
The F&N bet comes at a tough time for arb traders, as mergers and acquisitions deal volume has declined sharply. Global mergers and acquisitions deals fell 3.7 per cent in value last year to US$2.357 trillion, while the number of announced deals dropped 11 per cent to 35,794, its lowest level since 2005, according to Reuters data.
The sources say Davidson Kempner, which declined to comment, stands to reap a massive profit if F&N fetches much more than the S$9.08 a share on the table from OUE. The Thais offered S$8.88 per share.
Davidson Kempner's 5 per cent stake translates into an investment worth US$570 million. Other hedge funds have also piled into F&N shares, but none taking as large an arbitrage bet as Davidson Kempner.
Hedge funds are betting that the deal could be struck between S$9.60 and S$10.50 per share, the sources said. That would be an increase of as much as 33 per cent from July 16 last year when F&N came up for grabs.
The worst-case scenario for a hedge fund is getting S$9.08 per share, according to the sources, about 6 per cent below the current trading price. An F&N spokeswoman declined to comment on Davidson Kempner's stake.
Last month, Mr Charoen tried and failed to acquire an additional 10 per cent of shares for S$9.60 per share in F&N. Mr Charoen, whose Thai Beverage and TCC Assets own a combined 34 per cent of F&N, is trying to boost his stake to more than 50 per cent before his offer expires later in January.
OUE last week extended its offer for F&N to Jan 14, one day after Charoen's group extended its $7.2 billion offer to take over the firm for the fifth time until Jan 10.
The market is betting that Jan 21 could be the D-day for the F&N battle, the final deadline for the two bidders to raise their offer. The Thais are currently F&N's largest shareholder.
Mr Lim Jit Soon, Head of equity research for South-east Asia at Nomura, estimates F&N's net asset value to be S$11 per share. Reuters
Davidson Kempner Capital Management has bought a good chunk of F&N shares since a consortium led by Indonesian tycoon Stephen Riady's Overseas Union Enterprise (OUE) launched a S$13.1-billion counter-bid for F&N in November. That offer surpassed an earlier one by Thai beer baron Charoen Sirivadhanabhakdi.
Davidson Kempner's role in the F&N saga is unusual for its size and because one of the bidders, in addition to attempting to buy out the company, is trying to increase its shareholding. At least one instance has emerged in which the Thai group has offered to buy F&N shares from existing shareholders and has been rebuffed - fuelling investor expectations of higher bids and buoying F&N's stock.
The New York-based hedge fund, which manages US$19 billion, has raised its F&N stake to just under 5 per cent since November, two sources with direct knowledge of the matter said.
That compares with less than 1 per cent before the Thai takeover interest in July last year, said one of the sources, who declined to be identified.
"That is an elephant, both in terms of the size of the fund that can and should take it and relative to Asian capital markets," said Mr Peter Douglas, founder of Singapore-based hedge fund consultancy GFIA.
Multi-strategy hedge funds like Davidson Kempner invest money in different ways, including betting on the success or failure of an acquisition offer for a public company - a tactic known as merger arbitrage, or "arb" trading.
The F&N bet comes at a tough time for arb traders, as mergers and acquisitions deal volume has declined sharply. Global mergers and acquisitions deals fell 3.7 per cent in value last year to US$2.357 trillion, while the number of announced deals dropped 11 per cent to 35,794, its lowest level since 2005, according to Reuters data.
The sources say Davidson Kempner, which declined to comment, stands to reap a massive profit if F&N fetches much more than the S$9.08 a share on the table from OUE. The Thais offered S$8.88 per share.
Davidson Kempner's 5 per cent stake translates into an investment worth US$570 million. Other hedge funds have also piled into F&N shares, but none taking as large an arbitrage bet as Davidson Kempner.
Hedge funds are betting that the deal could be struck between S$9.60 and S$10.50 per share, the sources said. That would be an increase of as much as 33 per cent from July 16 last year when F&N came up for grabs.
The worst-case scenario for a hedge fund is getting S$9.08 per share, according to the sources, about 6 per cent below the current trading price. An F&N spokeswoman declined to comment on Davidson Kempner's stake.
Last month, Mr Charoen tried and failed to acquire an additional 10 per cent of shares for S$9.60 per share in F&N. Mr Charoen, whose Thai Beverage and TCC Assets own a combined 34 per cent of F&N, is trying to boost his stake to more than 50 per cent before his offer expires later in January.
OUE last week extended its offer for F&N to Jan 14, one day after Charoen's group extended its $7.2 billion offer to take over the firm for the fifth time until Jan 10.
The market is betting that Jan 21 could be the D-day for the F&N battle, the final deadline for the two bidders to raise their offer. The Thais are currently F&N's largest shareholder.
Mr Lim Jit Soon, Head of equity research for South-east Asia at Nomura, estimates F&N's net asset value to be S$11 per share. Reuters
Monday, December 24, 2012
Merry Christmas and a Happy New Year
Wishing all the readers Merry Christmas and a great New Year in 2013.
It has been a difficult year which saw a period where deals just dried up in Asia Pacific and several deals go bust. However a flurry of deals were just announced before the year end and we hope that most of you have made money this year!
We are happy to announce that Merger Arbitrage Manager has now achieved close to 100 downloads. We hope that sales will continue into this festive season and more people would find the app helpful in understanding Merger Arbitrage risk-returns.
Once again have a Merry Christmas wherever you are.
Signing off for the year,
The Ex-Hedge Fund
It has been a difficult year which saw a period where deals just dried up in Asia Pacific and several deals go bust. However a flurry of deals were just announced before the year end and we hope that most of you have made money this year!
We are happy to announce that Merger Arbitrage Manager has now achieved close to 100 downloads. We hope that sales will continue into this festive season and more people would find the app helpful in understanding Merger Arbitrage risk-returns.
Once again have a Merry Christmas wherever you are.
Signing off for the year,
The Ex-Hedge Fund
Wednesday, December 19, 2012
Billabong_revisited 2
I got out of my earlier position. Must admit have read the situation wrongly. But given the muddy waters in this deal, I am out. Although it seems the Mr Naude is potentially more optimistic about the turnaround of the company given the US division has been the one bringing in revenue and profit, I must admit, after such long time, I am getting very sceptical what is the value of the company, and all the non-binding clauses, which enables the acquirer to re-value their bid
Wednesday, December 12, 2012
HK Deal : 0053.HK privatisation by group led by Quek Leng Chan
Summary of Deal :
$88 offer price per share
Unconditional
Acquirer already has 74.47%
Mandatory acquisition once reach 90%
Currently trading above offer price. Not entering
$88 offer price per share
Unconditional
Acquirer already has 74.47%
Mandatory acquisition once reach 90%
Currently trading above offer price. Not entering
TCC extends F&N bid yet again
SINGAPORE - TCC Assets, the family company of Thai whiskey magnate Charoen Sirivadhanabhakdi, yesterday extended for the fourth time a deadline for its S$8.8 billion bid for full control of the Singapore property, publishing and food and beverage conglomerate Fraser & Neave.
The closing date for the S$8.88 a share bid now falls on Jan 2, a day before a higher bid of S$9.08 per share by Overseas Union Enterprise (OUE) - controlled by Indonesia's Riady family - is due to expire.
Under Singapore's Code on Takeovers and Mergers, an offer normally has to be finalised within 60 days of the initial offer, which in TCC's case was Sept 13.
But the Securities Industry Council has the authority to grant an extension in special circumstances, such as when a competing bid is made, and it has been about one and a half months since OUE made its rival bid.
What surprised many market observers was that there was no attempt by the Thais to better OUE's offer, thereby making it unlikely that any other F&N shareholder will sell his stake to TCC.
TCC, together with its listed vehicle Thai Beverage, is F&N's largest shareholder with a 35.68-per-cent stake, inclusive of 2.02 per cent in acceptances that becomes ownership only after the 50-per-cent mark is achieved.
"What's the point of extending the deadline without upping the OUE offer? And how will OUE respond to the extension?" asked an exasperated shareholder, who said both offers were inadequate.
Many think the bid for F&N has to be at least S$9.50 a share before new acceptances come in.
The independent advisers to F&N's board have found TCC's offer "not compelling, though fair".
Nomura Securities analyst Lim Jit Soon, who has a target price of S$10.48 on F&N, thinks that OUE could bid as high as S$9.88 a share.
Japanese beer maker Kirin Holdings, which has a 14.8-per-cent stake in F&N, has agreed to tender its shares to OUE, which is largely focused on office and hotel ownership and development. Kirin has also offered to buy over F&N's food and beverage business for S$2.7 billion should the Riadys succeed.
Article above taken from TODAYonline. Article by Conrad Raj
The closing date for the S$8.88 a share bid now falls on Jan 2, a day before a higher bid of S$9.08 per share by Overseas Union Enterprise (OUE) - controlled by Indonesia's Riady family - is due to expire.
Under Singapore's Code on Takeovers and Mergers, an offer normally has to be finalised within 60 days of the initial offer, which in TCC's case was Sept 13.
But the Securities Industry Council has the authority to grant an extension in special circumstances, such as when a competing bid is made, and it has been about one and a half months since OUE made its rival bid.
What surprised many market observers was that there was no attempt by the Thais to better OUE's offer, thereby making it unlikely that any other F&N shareholder will sell his stake to TCC.
TCC, together with its listed vehicle Thai Beverage, is F&N's largest shareholder with a 35.68-per-cent stake, inclusive of 2.02 per cent in acceptances that becomes ownership only after the 50-per-cent mark is achieved.
"What's the point of extending the deadline without upping the OUE offer? And how will OUE respond to the extension?" asked an exasperated shareholder, who said both offers were inadequate.
Many think the bid for F&N has to be at least S$9.50 a share before new acceptances come in.
The independent advisers to F&N's board have found TCC's offer "not compelling, though fair".
Nomura Securities analyst Lim Jit Soon, who has a target price of S$10.48 on F&N, thinks that OUE could bid as high as S$9.88 a share.
Japanese beer maker Kirin Holdings, which has a 14.8-per-cent stake in F&N, has agreed to tender its shares to OUE, which is largely focused on office and hotel ownership and development. Kirin has also offered to buy over F&N's food and beverage business for S$2.7 billion should the Riadys succeed.
Article above taken from TODAYonline. Article by Conrad Raj
Australia Deal : GPT offers to take up commercial and industrial properties off Australand
Still much to be revealed..stay tune.
Tuesday, December 11, 2012
Sundance Resources Update
A reader has commented on this deal. I must apologize as I missed the comment made.
From my perspective, the deal will go through. Given the commitment on Hanlong Mining Investment and the in principle agreements from the government, it should not be a problem.
When we enter these deals, ie Chinese buyer and African country assets, you would expect regulatory risk and should have been priced into your buy levels, ie only buy in when the risk premium suits you.
Also you could see Hanlong providing (albeit a small ) convertible note facility for A$15m as working capital for Sundance as the deal moves forward. Hanlong also holds the biggest stake in Sundance as well. Price of Sundance now is reasonably close to what it was before the deal announcement (however caution here as it seems like Sundance may have a liquidity problem).
Given the reasons above, I would believe the deal would be successful in the end, but the question remains when it will close and will there be another drop in offer price.
Pricing using Merger Arbitrage Manager as below :
Has a 40% premium and a 13.33% implied success. Given this, I would caution against a big position.
Potential Merger : Alacer Gold
Attention gold miners with a spare 1.86 billion Australian dollars (US$1.95 billion) handy. Macquarie analyst Mitch Ryan reckons you could spend it on a takeover ofAlacer Gold Corp. ASR.T +3.67%.
“We believe that Alacer is becoming an increasingly interesting target for a potential takeover, our rationale being an acquirer can pay a reasonable premium to recent share prices, assume zero value for Australian assets and still be in the black for the prize Turkish assets,” he said in a note to clients.
Under such a scenario, the broker believes an acquirer could pay between A$6.50 and A$7.00 to gain control, which would value Alacer between A$1.86 billion and A$2 billion.
He thinks Alacer’s review of its Australian business unit could result in the divestment of some or all of its assets – currently carried at US$1.2 billion. But he notes any write down would be unlikely to cause balance sheet pressure or restrict Alacer’s ability to pay dividends.
Macquarie believes that any potential suitors won’t rush a deal out, choosing instead to wait until the first quarter of 2013 or for the outcome of the Australian business review and the bankable feasibility study for its 80%-owned Copler Sulfides project in Turkey.
Macquarie has an Outperform recommendation and a price target of A$6.20 a share on Alacer which last traded at A$4.55 a share. The stock has fallen 54.7% in the year to date, making it the worst-performing gold stock in the S&P/ASX200.
Thursday, December 6, 2012
Singapore Deal : SC Global bid by owner to go Private
Offer Highlights
• The Offer Price is $1.80 per Share in cash and is unconditional in all respects.
• The Offer represents an opportunity for Shareholders to exit and realise their
• Mr Simon Cheong already owns or controls a 55.06% stake in SC Global
Developments Ltd ("SC Global" or the "Company") and is seeking to de-list
and privatise SC Global for the following reasons:
• Shareholders who accept the Offer before the Offer closes will be paid the
Offer Price for their Offer Shares within 10 days after the receipt by the
Offeror of valid and complete acceptances of the Offer.
Deal offered at $1.80. Last close price at $1.21. Roughly 48.76% premium to close. However as this deal is unconditional, expect it to trade at $1.80 upon open. Should not have any money left on the table. If there are any money to be made inclusive of your brokerage cost, go for it.
I do not think there will be another higher bid coming in given Mr Simon Cheong already owns 55.06% (control of the company) and this exercise is to defray the cost of listing,reporting and regulatory redtapes, So there is not an inherent call option in this deal.
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