☕️ Takeover tussle

An interesting (and convoluted) funds management deal is playing out on the ASX.

August 01, 2023

Good morning.

A couple of big items on the agenda today. August corporate reporting season quietly kicks off with Credit Corp set to deliver its results. Things will really ramp up on on the earnings front next week.

Secondly, and as discussed yesterday, we have an interest rate decision from the RBA this afternoon.

The LOI Interest Rate Prediction Poll™️ results are in:

We’ll find out how accurate that call is later this afternoon.

ps. if this was forwarded to you, you can sign up for LOI at letterofintent.com.au

LOI Subscriber #TBD

MARKET MOVERS

*Stock data as of the market close. Commodities and crypto data in USD.

Market News: The most interesting (and convoluted) funds management takeover battle since last year’s three way Perpetual-Pendal-Regal tussle is unfolding on the ASX right now. Regal is again involved, as is GQG Partners, one of the notable decliners in a flat market yesterday.

GQG is an interesting story in its own right. Based in Fort Lauderdale, Florida, it manages more than US$100 billion ($148bn) in global equity funds, and for some reason decided to list on the ASX in the biggest IPO of 2021. One of GQG’s earliest backers was ASX-listed house of boutiques, Pacific Current Group, which still owns about 4% of GQG. That stake is worth ~$190 million based on GQG’s market cap of ~$4.8 billion.

Last week Pacific Current shares shot up after Regal lobbed a bid for the company. Regal’s proposal involves releasing the GQG stake back to Pacific shareholders (who would get $7.50/sh in cash or Regal stock, plus 2.2 shares in GQG for each share held).

One day later, GQG announced its intention to put together its own bid for Pacific Current. We don’t know what that proposal looks like yet, and yesterday’s reaction in GQG shares suggests some anxiousness about that.

THE QUICK SYNC

  • Adani Group is looking to raise US$1.8b on Indian bond markets. (Bloomberg)

  • Robinhood rival eToro raised US$120m in a secondary share sale. (CNBC)

  • Coatue, a prominent US VC, raised US$331m for its third fund, falling short of its target. (The Information)

  • AMC Theaters had its best week on record thanks to ‘Barbenheimer’. (CNN)

TRADING FLOOR

M&A:

  • FinClear acquired Transact1, a Brisbane cash investment platform. (AFR)

  • Pacific Equity Partners has asked lenders to propose preliminary parameters for a $500m financing package to fund its Hoyts acquisition. (AFR)

  • BHP has reportedly pushed back the date for final bids for Daunia and Blackwater by just over one week. (The Australian)

  • EnergyAustralia warned the ACCC that rejecting Origin's $18.7bn acquisition bid could "send a negative signal to the market." (AFR)

  • Pacific Current increases assets as the board considers a Regal proposal. (AFR)

  • Ecofibre announced a $9m annual supply deal for its subsidiary Hemp Black with Under Armour Inc. (BNA)

  • Houlihan Lokey, Lazard, and Moelis pitched to advise the lenders of Accolade Wines. (The Australian)

  • Talon and Strike Energy are set to announce a deal. (The Australian)

Capital Markets:

  • LVX Global is seeking to raise up to $5m in a pre-IPO capital raising. (AFR)

  • RFC Ambrian is tipping in $5m into NextOre’s Series B growth funding round. (AFR)

  • Finder could test its $770m valuation in private markets as it considers a capital raise. (AFR)

  • Mason Stevens has been meeting with potential investors in preparation for an IPO. (AFR)

  • Plotlogic has secured $42m in Series B funding. (BNA | AFR)

VC:

  • Nine Australian VC funds are currently in market looking to raise new funds. (AFR)

  • Plerion, a cyber security startup, has closed a $10m seed round led by Prosus Ventures. (BNA | StartupDaily)

  • PMY Group, an AFL star-backed Melbourne tech firm, has landed $45m from Bluestone Partners. (AFR)

Others:

  • Adam Penny, JPMorgan’s former head of financial institutions for investment banking, has left the Wall Street bank. (The Australian).

  • CIMIC confirmed it wants to use its stake in Abertis to expand into tolling motorways in Australia. (AFR)

  • Wesfarmers’ Bunnings has stripped out a layer of senior management as part of a restructuring. (The Australian)

  • National Australia Bank drafts Krista Baetens for corporate and institutional banking. (AFR)

  • NSW Fair Trading has revealed it has launched an investigation into Metricon Homes following a surge in consumer complaints this year. (BNA)

THE WATERCOOLER