Carlyle, Pacific Equity In $2B Takeover Bid For Australia’s Link
The Carlyle Group together with Pacific Equity Partners have made a conditional offer to snap up Australia’s Link Administration Holdings Ltd. in an all-stock deal worth A$2.76 billion ($2 billion).
The indicative non-binding price offered to Link shareholders under the proposal by private equity firms Carlyle (CG) and Pacific Equity is A$5.20 per share. The offer price, which represents a 30.3% premium to Friday’s close, assumes no further dividends, distributions or reductions in capital would be paid from the proposal date. The deal is still subject to due diligence, securing debt financing, final investment committee approval from the relevant consortium committees, and regulatory approvals.
Link is a provider of technology-based administration solutions, including financial ownership data, data analytics, and fund administration services. The company has over 6,000 employees and its clients include some of the world’s largest corporations, pension funds, and financial institutions.
Link’s Board said that it will consider the offer and obtain advice from its financial and legal advisers, while asking shareholders not to take any action for the time being. Meanwhile, Perpetual which holds a 9.65% stake of the company, said it intends to vote in favour of the consortium acquiring 100% of Link at a share price of no less than A$5.20, should one proceed. Link has appointed Macquarie Capital and UBS as its financial advisers.
Carlyle has in recent months been on a buying spree. The private equity firm is reportedly seeking to invest $1.5 billion-$2 billion to acquire a stake in Reliance Retail Ventures Ltd (RRVL), India’s largest retail chain. In June, it bought a 20% stake in the pharmaceutical business of Indian Piramal Enterprises Ltd. for about $490 million. Earlier this year, it announced a majority stake investment in SeQuent Scientific, the largest Indian pure-play animal healthcare company.
Shares in Carlyle have plunged almost 17% this year, while analysts are sidelined on the stock. The Hold consensus shows 5 Holds and 1 Sell versus 2 Buys. (See Carlyle stock analysis on TipRanks)
That’s with a $30.88 average analyst price target indicating 15% upside potential in the shares in the coming 12 months.
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