Back on the 7th August, broker/investment bank Guotai Junan (1788 HK) (GJI) announced a pre-conditional (SASAC/NDRC) Scheme at HK$3/share, a 44.2% premium to last close, from Guotai Haitong (2611 HK).
The pre-cons were satisfied uncommonly quick on the 30th October. Vote risk is low. There are some quirky Scheme vote-blocking %s.
The Scheme Document is now out, with a 30th November Court Meeting, and expected payment by the the11th February (later than expected). The IFA (Altus) concluded “fair and reasonable“.
The Trade:
Trading tight at 1.7%/6.5% gross/annualised spread.
I thought there might be some weakness today given the protracted payment date.
This is a clean deal. The risk this is blocked is low.
If not in, I’d be looking elsewhere.
Somewhat related, Haitong Unitrust International Financial Leasing (1905 HK) (Haitong Unitrust (1905 HK): SIG’s Partial As Guotai Haitong Cleans House) looks attractive.