Australia's Insignia agrees to $2.2 billion CC Capital bid, below peak offer
The agreed A$4.8 per-share price falls short of the bid of A$5 apiece CC Capital had raised in March to match rival Bain Capital's competing offer. The discount highlights how market conditions and bidder fatigue ultimately tempered valuations for the 180-year-old wealth management firm.
Shares of the company rose as much as 16.03% to an early March high of A$4.560, outperforming the broader benchmark's (.AXJO), opens new tab 0.5% rise.
Foreign companies are competing to gain access to Australia's wealth management and retirement savings industry.
Insignia oversees about A$327 billion in assets, making it the third-largest player in the country's superannuation sector, and offers various other services, including financial planning and investment management.
Both Bain Capital and CC Capital Partners were granted an additional four weeks in April to finalise their bids after requesting extended exclusivity periods to complete debt funding and due diligence.
However, U.S.-based Bain Capital withdrew its A$3.34 billion offer in May, leaving CC Capital as the sole remaining suitor.
At the time, a third suitor, Brookfield Asset Management (BAM.TO), opens new tab, did not raise its offer, and media reports have since said the New York-based private equity firm had walked away.
In recommending the scheme, Insignia Financial's directors considered the competitive process that saw the three bidders submit eight indicative offers before CC Capital's binding proposal emerged as the winning bid, the company said.
Insignia's board unanimously recommended shareholders to approve the scheme of arrangement "in the absence of a superior proposal". Subject to shareholder approval and other conditions, the company expects the scheme to be implemented in the first half of 2026.
The takeover comes as Insignia reported solid quarterly results, with funds under administration rising A$8.5 billion, or 2.6%, to A$330.3 billion as of June 30.
($1 = 1.5337 Australian dollars)
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