Bought 10% position in 51jobs @ 70USD per share.
This is a classic Chinese ADR privatisation deal with a PE sponsor. DCP Capital is currently offering to take 51jobs private. My guess is that mgmt team will join them in the privatisation deal at some point and hence they only have to buy 50% of the shares outstanding.
I should note that as compared to other Chinese ADR privatisation deal, the valuation sounds fair. So I believe there is very little chance of price improvement from here. Overall, I think the deal is very likely to pass within 3-6 months.
I see this deal as a way to earn a higher return on cash with a good risk-adjusted return. I would not want to participate in merger arb if I can find high quality companies to own for the long term.
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