alwaysinvert Posted December 11, 2018 Author Share Posted December 11, 2018 The pledged shares that represent 20% of the share capital have by all appearances still not been bought by Jin Jiang. I wonder what's going on with them. Link to comment Share on other sites More sharing options...
whistlerbumps Posted December 11, 2018 Share Posted December 11, 2018 I am not sure but it has been rumored that those were actually sold in the market and that HNA and the lenders do not actually have control of them anymore. Again, that is rumor but seems somewhat suppported by the fact that JJ has not been able to buy them yet. Its very weird to me that no one seems to know concretely where those shares are. On the one hand, makes a higher price more expensive for Jin Jiang (more shares to buy) but on the other hand also lowers the worries about a very illiquid stub if they don't make a more serious attempt to get to 90% Link to comment Share on other sites More sharing options...
alwaysinvert Posted December 11, 2018 Author Share Posted December 11, 2018 I am not sure but it has been rumored that those were actually sold in the market and that HNA and the lenders do not actually have control of them anymore. Again, that is rumor but seems somewhat suppported by the fact that JJ has not been able to buy them yet. Its very weird to me that no one seems to know concretely where those shares are. On the one hand, makes a higher price more expensive for Jin Jiang (more shares to buy) but on the other hand also lowers the worries about a very illiquid stub if they don't make a more serious attempt to get to 90% Here's what happened when HNA was margin called on some other pledged shares a while ago: https://www.reuters.com/article/us-dufry-m-a-elliott/elliott-takes-5-6-percent-stake-in-swiss-duty-free-retailer-dufry-idUSKBN1EE0VD Link to comment Share on other sites More sharing options...
compounding Posted December 11, 2018 Share Posted December 11, 2018 The anchoring point is fair, but why would they bet 40 instead of the minimum? As we seem to agree, bidding 40 gives some info as it hints that they want to buy the whole thing. Doesn't really matter though, I guess it's fine as an explanation. whistlerbumps, thanks for mentioning the Orbis transaction. It seems that they have a similar profile in terms of a dominant lease portfolio (which they are shrinking) and a growing managed/franchise portfolio. Levered at around 0.7x. On the other hand they have an EBIT margin of 20%. Based on those metrics it looks like a pretty nice acquisition for Accor at 8.5x. The large volumes above 40 today are encouraging (especially large net buying from IBKR accounts, I would assume), and the seemingly disappeared pledged shares should also be a net positive for minority shareholders. Both those two points will be interesting to follow in the coming month. I'm thinking the long case for RADH has improved today at 40.05 vs yesterday at 36.50. Link to comment Share on other sites More sharing options...
alwaysinvert Posted December 12, 2018 Author Share Posted December 12, 2018 I'm thinking the long case for RADH has improved today at 40.05 vs yesterday at 36.50. I'm not entirely sure it has improved but it's hard for me to see how risk/reward is much worse now than before the bid. Relative to fundamentals, the price difference is hardly noticeable (especially since the SEK has performed poorly lately too) and some of the worse scenarios for the minority are now off the table or have at least diminished probability. Link to comment Share on other sites More sharing options...
compounding Posted December 14, 2018 Share Posted December 14, 2018 I'm thinking the long case for RADH has improved today at 40.05 vs yesterday at 36.50. I'm not entirely sure it has improved but it's hard for me to see how risk/reward is much worse now than before the bid. Relative to fundamentals, the price difference is hardly noticeable (especially since the SEK has performed poorly lately too) and some of the worse scenarios for the minority are now off the table or have at least diminished probability. My reasoning was that the implied put is cheaper and that we now have some evidence that Jin Jiang is interested in buying the whole company. So risk is less and reward more probable. I agree with the last part of your post. Yet Another Value Blog, or Andrew Walker on Twitter, posted his thoughts on the situation today: http://yetanothervalueblog.com/2018/12/christmas-idea-1-radisson-hospitality-radh.html I found his take on reasons for bidding 40 interesting. In addition to what has been said here, he emphasised the possibility for JJ to negotiate with event-driven investors that buy now and will sell for a quick bump, sounds reasonable to me. I would add that the company has guided to EBITDA improvements yoy in Q4. Going by the performance from the team the last couple of quarters, I'm pretty confident that they will deliver on their guidance and bump up EBITDA in Q4 (which is what I assumed in my post using the 6x multiple). Also, speaking about comps ... Scandic is trading at 7.7x EBITDA at the moment, with 2.7x EBITDA in net leverage, worse margins, and I would argue worse growth prospects. IMO Scandic is not expensive, and the stock might even be interesting at a 12.2 P/E (I think Alluvial Capital owns it). So this comp is worse in most ways, no control premium, might itself be on the cheap side, and still priced way higher than the JJ bid. Link to comment Share on other sites More sharing options...
compounding Posted January 2, 2019 Share Posted January 2, 2019 "The Independent Committee of Radisson recommends the shareholders of Radisson not to accept the mandatory public offer made by the Consortium." https://globenewswire.com/news-release/2019/01/02/1679315/0/en/Statement-by-the-Independent-Committee-of-the-Board-of-Directors-of-Radisson-in-relation-the-mandatory-public-offer-from-a-consortium-led-by-Jin-Jiang-International-Holdings-Co-Ltd.html As expected so far. No news regarding the pledged shares from what I have seen, and no activists getting involved either. Link to comment Share on other sites More sharing options...
compounding Posted January 4, 2019 Share Posted January 4, 2019 Bid raised to 42.50 today. They chose to commit to the timeline on acceptance and cash delivery, which means they cannot raise the bid further according to Swedish takeover rules. https://mb.cision.com/Main/17439/2711195/971596.pdf Link to comment Share on other sites More sharing options...
alwaysinvert Posted January 5, 2019 Author Share Posted January 5, 2019 Well played to Jin Jiang here. Seeing as no outside shareholder has made any noise whatsoever, I lean towards them succeeding in taking the company private with this bid. If not for the market turmoil, maybe we would have gotten 2 SEK more. Such is life. Link to comment Share on other sites More sharing options...
DeepValuePlay Posted February 5, 2019 Share Posted February 5, 2019 What happened to the share price yesterday?? Link to comment Share on other sites More sharing options...
writser Posted February 5, 2019 Share Posted February 5, 2019 Expiration of the tender offer. Situation is interesting again. Did they get 90%? What will they do if they didn't? Link to comment Share on other sites More sharing options...
Hielko Posted February 5, 2019 Share Posted February 5, 2019 I think it might also have to do something with the taxes that are payable on cash received in a squeeze out in Sweden. Link to comment Share on other sites More sharing options...
writser Posted February 5, 2019 Share Posted February 5, 2019 What tax would that be? I didn't see anything in the offer document about a squeeze-out being a taxable event (for foreign shareholders), nor did I find anything relevant with Google. But I might very well be missing something. Link to comment Share on other sites More sharing options...
dontdodebt Posted February 5, 2019 Share Posted February 5, 2019 What happened to the share price yesterday?? Last day to accept the bid for 42.5 SEK was yesterday. So if they get over 90% ownership it will probably be "forced redemption" (I´m ashamed, don´t know the english word for this) which means it can take a lot of time (1,2 years) until you get ~42.5 SEK per share. If they don´t get 90% they still could delist the stock (as long as they have at least 50% of the votes and that the majority votes yes on delisting). However, if they just delist the stock it may be a good value buy and hope it to be listed again sometime in the future? Above is my understanding, correct me if im wrong. Link to comment Share on other sites More sharing options...
Hielko Posted February 5, 2019 Share Posted February 5, 2019 What tax would that be? I didn't see anything in the offer document about a squeeze-out being a taxable event (for foreign shareholders), nor did I find anything relevant with Google. But I might very well be missing something. Afaik a squeeze out is taxed at 30% and you can reclaim 15% in Sweden. Link to comment Share on other sites More sharing options...
alwaysinvert Posted February 5, 2019 Author Share Posted February 5, 2019 Since the payout is slated for Feb 7, I assume that we will know at the latest by that point how many shares have accepted the offer. Link to comment Share on other sites More sharing options...
alwaysinvert Posted February 5, 2019 Author Share Posted February 5, 2019 94% accepted Link to comment Share on other sites More sharing options...
whistlerbumps Posted February 5, 2019 Share Posted February 5, 2019 yup... well played by Jin Jiang to take advantage of market volatility to get a good price.... I think they make a great return on this from 42.50 Link to comment Share on other sites More sharing options...
writser Posted February 5, 2019 Share Posted February 5, 2019 Curious to see where it will trade tomorrow. Bought a few shares today. Link to comment Share on other sites More sharing options...
writser Posted February 6, 2019 Share Posted February 6, 2019 12% Higher, I guess. Interesting price action yesterday. Seems like the taxes weren't the issue. The squeeze-out is mandatory at 90% afaik so was the market really that worried the 90% threshold wouldn't be reached? I'd say a 80% acceptance rate of the offer didn't seem that unlikely after two price hikes. Sized the trade conservatively because I haven't been paying much attention to what was going on. Link to comment Share on other sites More sharing options...
dontdodebt Posted February 6, 2019 Share Posted February 6, 2019 Yeah, pretty weird pricing from the market yesterday imo. To buy now to this price can not be such a good idea. It can take a long time before the shares get liqutidated at ~42.5 SEK Link to comment Share on other sites More sharing options...
writser Posted February 6, 2019 Share Posted February 6, 2019 Yeah, current spread seems thin for a stock that will be delisted and squeezed out with (as far as I know) no indication of any timeline. I sold out. Don't know what happened the past two days but seems like some market participants were a bit too fearful after the tender offer expired. Or maybe I was way too enthusiastic about the threshold being reached. Probably a bit of both. Hard to maintain that it was efficiently priced all the way. Link to comment Share on other sites More sharing options...
alwaysinvert Posted February 6, 2019 Author Share Posted February 6, 2019 I also managed to dip in a last trade for a quick ~15%, although I probably should have done it in more size than I mustered conviction for. Everything is easier in hindsight, as usual. Even managed to get my last shares sold for 42.55 in the end call for some strange reason. Like someone said, Jin Jiang is in all likelihood making a very good deal here. On to the next one for the rest of us. Link to comment Share on other sites More sharing options...
dontdodebt Posted February 6, 2019 Share Posted February 6, 2019 I wasn´t sure if I had missed something plus I´m under the regulation of not be allowed to sell any financial instrument withing 30 days with profit, so I had to hold it until it got liquidated... So no quick buck for me. Pain! Link to comment Share on other sites More sharing options...
writser Posted February 6, 2019 Share Posted February 6, 2019 although I probably should have done it in more size than I mustered conviction for. Everything is easier in hindsight, as usual. Couldn't agree more with both .. Stil, managed to make some money in this name despite being skeptical all along the way. Thanks for opening this thread and sharing your insights. Link to comment Share on other sites More sharing options...
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