Guotai Junan (1788 HK): Get Involved Here
After broker/investment bank Guotai Junan (1788 HK) (GJI) was suspended last month pursuant to the Takeover’s Code, an Offer from its state-backed parent Guotai Haitong (601211 CH) (GHS) was expected.
That unfolded last Friday evening (7th July), with GHS pitching a pre-conditional (SASAC/NDRC) Scheme at HK$3/share, a 44.2% premium to last close, bang in-line with my estimate. Terms are final.
The pre-con long stop date is the 31st October. That’s uncommonly quick. This could (should) be wrapped up before year-end. Plus there are some quirky Scheme vote-blocking %s.
The Trade:
At 5.8%/15.5% gross/annualised spread, I’d be a buyer here.
This is a clean deal.
The risk this is blocked is low.
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