I wrote up Dingdong today. I think it's an interesting idea. Chinese stocks are disliked & ignored by most, for a multitude of reasons lately. Nobody is looking. Probably why this one is trading under the radar & at such a wide spread to the sale proceeds & capital returns.
Here's a summary, feel free to check out my write up on Substack.
Dingdong agreed to sell its China business to Meituan for $717m in cash. But Dingdong can also pull $280m out of the China sub. That’s $997m cash on a current market cap of approx. $505m. Shareholders have voted for the deal & management has explicitly told us that 90% of the proceeds will be used for capital returns. So that's 97% upside on gross proceeds or 77% after taxes & transaction costs.
Happy to discuss any comments or pushback.
Cheers,