In today’s briefing:
- Pendal Group (PDL AU): Perpetual’s Bump Should Get the Deal Done
- Ramsay’s Overdue Update on the KKR Proposal
- Pendal Gets a Binding Offer from Perpetual
- Pendal Enters Scheme With Perpetual
- Imugene (IMU AU): Clinical Trial Continued to Advance; Cash Position Still Strong
Pendal Group (PDL AU): Perpetual’s Bump Should Get the Deal Done
- Pendal Group and Perpetual Ltd have entered into a SID where Pendal shareholders will receive 1 share of Perpetual for every 7.5 shares in Pendal, plus cash of A$1.976/share.
- While this is a premium to the last close and undisturbed prices, it is a discount to longer term prices. The Pendal Board has unanimously recommended the offer though.
- In the short-term expect short covering on Pendal Group (PDL AU) and increased shorts on Perpetual Ltd (PPT AU) as arbs step in to close the gap.
Ramsay’s Overdue Update on the KKR Proposal
- Ramsay Health Care (RHC AU) notes that discussions with KKR are ongoing, but the indicative proposal is held up by due diligence access to Ramsay Generale de Sante (GDS FP).
- KKR proposed an alternative proposal that the Board rejected as “meaningfully inferior.” KKR remains interested, and its shenanigans are likely a move to nudge down the price.
- At the last close, the risk/reward profile is favourable as the downside due to a deal break (-3% estimated decline) is lower than the upside (+20%) to the indicative proposal.
Pendal Gets a Binding Offer from Perpetual
- Pendal Group (PDL AU) entered a scheme implementation deed with Perpetual Ltd (PPT AU). The revised offer – scrip (1 Perpetual share for every 7.5 Pendal share) and cash (A$1.976).
- The revised offer throws in an 18.3% higher cash component as a sweetener. The offer implies a healthy acquisition multiple compared to peers.
- The offer is subject to shareholder and regulatory approvals. At the last close price, the gross spread to the current offer value of A$5.635 per share is 13.7%.
Pendal Enters Scheme With Perpetual
- On the 4 April, asset manager Pendal (PDL AU)‘s board unanimously determined the indicative cash/scrip Offer proposal from Perpetual (PPT AU) undervalued the current and future value of the company.
- Pendal And Perpetual have now entered into a SID such that Pendal shareholders will receive 1 Perpetual share for every 7.5 Pendal shares plus $1.976 cash for each Pendal share.
- The negotiation clincher was the increase in the cash component by A$0.306/share. Should the deal complete, Pendal will hold 47% in the enlarged entity.
Imugene (IMU AU): Clinical Trial Continued to Advance; Cash Position Still Strong
- Imugene Ltd (IMU AU) has recently dosed the first patient in cohort 3 in the phase 1 clinical trial of oncolytic virotherapy candidate, CHECKvacc for breast cancer.
- As at June 30, 2022, Imugene had cash balance of A$99.9 million, providing a runway to support its clinical pipeline and operations into 2025.
- As the clinical trials progressing, the company has appointed an experienced life sciences CFO.
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