Daily Review

Jana Partners intensifies campaign for changes at Lamb Weston. (Reuters)

Activist investment firm Jana Partners has enlisted Jeff DeLapp, a seasoned executive with prior leadership roles at Lamb Weston and McCain Foods, as part of its efforts to drive strategic changes at Lamb Weston Holdings. This addition marks the sixth executive collaborating with Jana, indicating a potential move to overhaul Lamb Weston's board.

Jana Partners, holding over a 5% stake in Lamb Weston, is advocating for operational improvements, better capital allocation, or a possible sale of the company. This initiative follows Lamb Weston's recent financial challenges, including a $36m loss in the fiscal second quarter and a 20% drop in stock price after disappointing earnings.

The hedge fund is collaborating with Continental Grain and has proposed several executives, including former Executive Chairman Timothy McLevish, as potential board nominees. Analysts suggest that these developments could increase the likelihood of strategic changes or transactions involving Lamb Weston.

Grupo Elektra shareholders approve delisting from Mexican Stock Exchange. (El Pais)

Grupo Elektra, the Mexican retail and financial services company owned by billionaire Ricardo Salinas Pliego, has received shareholder approval to delist from the Bolsa Mexicana de Valores. This decision follows a 70% decline in the company's share value in December and ongoing disputes with financial regulators.

The delisting is part of a strategic shift towards privatization and a new business model, with over 95% of shareholders supporting the move. A new Board of Directors, led by Pedro Padilla Longoria and Gabriel Alfonso Roqueñí Rello, will oversee the company's reorganization, focusing on enhancing digital, financial, and international capabilities.

Ricardo Salinas Pliego will continue as honorary chairman of the Board of Directors. The company plans to strengthen its digital and international operations as part of its new strategic direction.

Shinsegae and Alibaba to establish joint venture in South Korea. (WSJ)

South Korean retail conglomerate Shinsegae Group is set to form a joint venture with Alibaba International, aiming to strengthen their positions in the competitive South Korean e-commerce market. The collaboration involves Shinsegae's affiliate, E-Mart, investing its entire stake in Gmarket, a South Korean e-commerce platform, into the new entity.

Scheduled for establishment in 2025, the joint venture will incorporate both Gmarket and AliExpress Korea. Despite the integration, both platforms will continue to operate independently, maintaining their unique brand identities and customer experiences.

This strategic move comes as Gmarket faces stiff competition from local e-commerce giants like Coupang and Naver, as well as increasing challenges from Chinese platforms such as AliExpress and Temu. By partnering with Alibaba, Shinsegae aims to enhance its e-commerce services and better compete in the world's fourth-largest e-commerce market.

Korean startup M&A activity declines by half in 2024, with smaller deal sizes. (KED Global)

In 2024, South Korea's startup ecosystem experienced a significant downturn in mergers and acquisitions, with the number of deals halving compared to the previous year. Additionally, the average deal size decreased, indicating a cautious investment environment.

This decline is attributed to various factors, including global economic uncertainties and a conservative approach from investors. Despite the downturn, certain sectors, such as artificial intelligence and biotechnology, continued to attract interest, albeit with more modest investment sizes.

Industry experts suggest that while the current trend reflects a temporary slowdown, the Korean startup ecosystem remains resilient. Ongoing government support and a focus on innovation are expected to drive a rebound in M&A activities in the coming years.

Hong Kong's IPO market rebounds in 2024, signaling renewed investor confidence. (DealStreetAsia)

Hong Kong's initial public offering market has experienced a significant resurgence in 2024, raising approximately HKD83bn ($10.7bn) through 63 listings, marking an 80% increase from 2023.

This revival is attributed to favorable policies implemented by the Hong Kong Stock Exchange and supportive measures from mainland Chinese regulators. Notably, the introduction of Chapter 18C in March 2023 has facilitated listings for specialist technology firms, with the first three companies utilizing this pathway debuting in 2024.

Looking ahead, forecasts from accounting firms KPMG and EY project that Hong Kong's IPO market will continue its upward trajectory in 2025, with total fundraising expected to reach between HKD100bn ($12.9bn) and HKD120bn ($15.4bn). This growth is anticipated to restore Hong Kong's position among the top three global exchanges for IPO fundraising.

CATL plans Hong Kong listing to raise at least $5bn. (DealStreetAsia)

Contemporary Amperex Technology, an electric vehicle battery manufacturer, has announced plans to pursue a listing on the Hong Kong Stock Exchange. The company aims to issue offshore H-shares, with the objective of raising at least $5bn to support its global strategic expansion and enhance competitiveness.

CATL's board has approved the proposal, which is now pending regulatory consent from authorities, including the China Securities Regulatory Commission. The listing is anticipated to occur in the first half of 2025, though specific details are yet to be finalized.

This move comes as CATL continues to dominate the global EV battery market, holding a 37% market share. The company has recently reported increased profit growth in the third quarter, despite facing challenges from an ongoing price war in China's EV sector

Tata Capital plans $1.75bn IPO in 2025. (Outlook Business)

Tata Capital, the financial services arm of the Tata Group, is preparing for an initial public offering in 2025, aiming to raise over $1.75bn. This move aligns with the Reserve Bank of India's mandate requiring "upper layer" non-banking financial companies to list by September 2025.

The IPO is expected to comprise both primary and secondary share sales. Tata Capital has engaged Cyril Amarchand Mangaldas as legal advisors and Kotak Mahindra Capital as investment bank advisors, with plans to onboard additional investment banks to ensure compliance with regulatory norms.

This offering follows the successful listing of Tata Technologies in 2023 and is anticipated to be one of the largest IPOs from the Tata Group. Tata Capital, serving over 5.2m customers through more than 900 branches across India, reported a revenue of $2.13bn for the fiscal year ending March 31, 2024, marking a 34% year-on-year increase.