In today’s briefing:
- Newcrest Backs Newmont’s US$19bn Offer
- MVIS Australia Equal Weight Index Rebalance: Potential Deletes & Capping Changes
- Newcrest Mining (NCM AU): Binding Offer from Newmont
- InvoCare (IVC AU): TPG’s Revised $13/Share Non-Binding Offer
- InvoCare (IVC AU): Board Capitulates to TPG’s Small Bump
Newcrest Backs Newmont’s US$19bn Offer
- On the 11 April, Newmont Mining (NEM US) bumped the all-scrip terms for Newcrest Mining (NCM AU) to 0.400 Newmont shares – from 0.380 – for each Newcrest share held.
- Exclusive due diligence was granted and now a firm Offer, by way of a Scheme, has been agreed.
- The Offer permits Newcrest to pay a special franked dividend of up to $US1.10/share on top of the Offer terms.
MVIS Australia Equal Weight Index Rebalance: Potential Deletes & Capping Changes
- There are unlikely to be any inclusions to the index in June while there are three stocks that are close to the deletion threshold.
- Even if there are no constituent changes, there will be capping changes that will result in one-way turnover of over 4% and a one-way trade of A$78m.
- Short interest on AMP Ltd (AMP AU) has been increasing as the stock has dropped and a further decline in the stock could lead to deletion.
Newcrest Mining (NCM AU): Binding Offer from Newmont
- Newcrest Mining (NCM AU) has entered a SID with Newmont Mining (NEM US) at 0.400 Newmont shares per Newcrest share + US$1.10 special dividend + ordinary dividends (FY2023 dividend of US$0.20).
- The proposal is subject to shareholder approval from both sets of shareholders along with regulatory approvals (FIRB, US, Canada, Papua New Guinea).
- The offer is attractive in terms of historical prices and VWAP exchange ratios but carries the volatility risk around Newmont shares and FX rates.
InvoCare (IVC AU): TPG’s Revised $13/Share Non-Binding Offer
- On the 7 March, PE outfit TPG took a 17.8% stake in InvoCare (IVC AU), Australia’s leading funeral services provider, and also pitched a A$12.65/share non-binding Offer via a Scheme.
- The Indicative proposal was subject to the completion of due diligence. InvoCare rejected the proposal on the 27 March. On the 24 April, TPG withdrew its NBIO.
- TPG has returned with a revised A$13/share, inclusive of a A$0.60/share fully franked dividend. If the proposal becomes a binding transaction, InvoCare’s Board intends to unanimously recommend it.
InvoCare (IVC AU): Board Capitulates to TPG’s Small Bump
- Invocare Ltd (IVC AU) disclosed a revised non-binding indicative proposal from TPG at A$13.00 per share, a mere 2.8% above the previously rejected proposal of A$12.65 per share.
- TPG Inc (TPG US) has secured a five-week exclusive due diligence. The Board intend to unanimously recommend a binding proposal at no less than A$13.00 per share.
- The Board’s capitulation for a marginal bump reflects the lack of a Plan B. While, not a knockout bid, the offer is reasonable. The gross spread stands at 4.6%.
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