Perpetual mounts $2.4b takeover bid for Pendal

Investment firm Perpetual has mounted a $2.4 billion takeover bid for asset manager Pendal, in another industry merger that could create an investment powerhouse with more than $200 billion in total assets.

Perpetual, led by chief executive Rob Adams, has been on a buying spree in recent years.

Perpetual, led by chief executive Rob Adams, has been on a buying spree in recent years.Credit:Louie Douvis

Perpetual on Monday launched a conditional, non-binding proposal to acquire 100 per cent of Pendal’s shares for an indicative price of $6.23 per share. The proposal would see Pendal’s shareholders own 48 per cent of the merged entity and Perpetual own the remainder.

Pendal’s board has commenced an assessment of the proposal, but issued a statement noting significant instability creating market volatility which may impact the share value of the deal.

“The Pendal board notes that the indicative proposal has been put forward at a time when significant geopolitical instability, the economic impacts of the ongoing COVID-19 pandemic and broader market volatility has disrupted the global markets in which Pendal operates.

“This has materially impacted the trading values of global asset managers which may not currently reflect their long-term potential to deliver attractive returns to investors.”

Pendal has appointed Macquarie Capital as its financial adviser and King & Wood Mallesons as its legal adviser as it considers the deal.

Pendal’s shares jumped by 24 per cent to around $5.56 per share when trading opened on Monday. Perpetual has requested a trading halt “pending a further announcement’.

Perpetual has been on a buying spree in recent years, acquiring US firms Barrow Hanley and Trillium Asset Management as chief executive Rob Adams executes a strategy to become a leading global investment manager.

It has been a busy time for fund manager deals, following last week’s announcement of the merger between Regal and and VGI.

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