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Josef Schuster
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Josef Schuster is the founder of IPOX Schuster LLC, a data driven financial technology firm specializing in Financial Products Design related to global IPOs and spin-offs ( Our philosophy involves the classification of global IPOs ans spin-offs as a separate asset class.... More
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  • The IPOX Week (12/05/2011): Pure Alpha - Another IPOX U.S. holding taken over at big premium !!! 0 comments
    Dec 5, 2011 12:05 PM


    Global equities surged as concerted global central bank action helped a big short-covering rally in the main indexes.  German and U.S. macro data lent further support. IPOX U.S. to benefit on continued takeover fever in U.S. specialty sectors. China-linked IPOs in Hong Kong focus of global IPO deal flow.


    ·         IPOX Breaking News - Pure Alpha: Another takeover in the IPOX U.S. universe (ETF: FPX, Index Ticker: IPXO):  IPOX is pleased to announce the acquisition of Successfactors (SFSF US), a constituent in the IPOX U.S. 100 Index (ETF: FPX), at a 52.8% premium. After the pending acquisitions of Motorola Mobility (NYSE:MMI) and Pharmassets (VRUS), this is the third IPOX U.S. Index member acquired at a big premium since August 2011.
    ·         Global equities closed the week with big gains, recovering most of the losses suffered during the previous 10-day losing streak. Strong U.S. holiday sales, good German data followed by concerted global central bank action provided a toxic mix for shorts to cover in the run-up to December Futures & Options expiration. The IPOX Global 30 Index (IPGL30), proxy for the performance of the largest and most liquid global IPOs over the past four years, rose +7.93% to -5.83% YTD, underperforming benchmark MSCI World (MXWD) by 42 bps. The broader IPOX Indexes (IPGL50 and IPGL100) rose as well.
    ·         The Story of the Week belonged to the big snap-back in relative spreads between the U.S. benchmarks (SPX, RUT) vs. the IPOX U.S. universe (ETF: FPX, Indexes: IPXO, IPXT). For example, the IPOX U.S. 100 (ETF: FPX), composed of many small-cap stocks, shed 408 bps. vs. the Russell 2000 (RUT), the same amount it gained during the previous week, underlying its powerful risk/return characteristics.

            All IPOX Regional Indexes bounced mostly in line with the surging benchmarks. With global risk falling sharply, most relative upside was within the IPOX Asia-Pacific Universe (IPTA). The Index, which provides a broad exposure to the largest and most liquid IPOs of firms domi-ciled in a developed country in the Asia-Pacific Region, rose a massive +8.43% to -2.04% YTD, beating the respective benchmarks. The upsurge was driven by a good week in China-linked exposure, the Macau-casino operators and  hard-hit IPOX heavyweight Dai-Ichi Life (8750 JT: +9.09%)

    ·         Most significant IPOs launched (Week 11/29/2011):   
    Return / IPO (%)
    Nextremaing Corp.
    139670 KS
    TV Logic Co. Ltd.
    121800 KS
    SFC Co. Ltd.
    112240 KS
    HKT Trust and HKT Ltd.
    6823 HK
    Sinjin Sm Co. Ltd.
    138070 KS
    8 IPOs launched in the global regions with the average (median) equally-weighted deal shedding -11.08% (-14.00%) based on the final offering price on the week. While select South Korean IPOs plunged, the IPO of HKT Trust and HKT Ltd. (6823 HK), debuted unchanged.

    ·         Week ahead: Hong Kong IPOs keep on coming
    Lead Manager
    ABM Investama TbK
    MS, Macquarie
    Sitoy Group
    1023 HK
    Hong Kong
    Merrill Lynch
    Home Street Inc.
    FBR Cap.
    WhiteSmoke Inc.
    Mem. Pro. Prtns.
    Citi, WFG
    Rose Rock Mid.
    Citi, Barcap
    China First Chem.
    2121 HK
    MS, CCB
    China Lifestyle
    1262 HK
    Citi, BOC
    China Outfitters
    1146 HK
    Daiwa, BOCI
    Despite a tough year for China-linked stocks, the Hong Kong IPO pipeline continues at a solid pace. In addition to leather products maker Sitoy Group (1023 HK), three China-domiciled specialty small/mid-cap deals are scheduled for the upcoming week, including Chemical maker China First (2121 HK), snack food provider China Lifestyle (1262 HK) and apparel manufacturer China Outfitters (1146 HK). The success of these deals may provide good momentum for the upcoming IPO of larger Hong Kong deals during the upcoming weeks, such as auto retailer Baoxin Auto Group (1293 HK), China Polymetallic (2133 HK) and jewelry retailer Chow Tai Fook (1929 HK). Significant U.S. IPO deal flow is only in the oil exploration space with Memorial Prod. Prtns. (NASDAQ:MEMP) and Rose Rock Midstream (NYSE:RRMS) lined up.

    Contact Us:
    Josef Schuster
    + 1 312 264 4410
    Mary Lee
    + 1 312 264 4411
    IPOX <GO>
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