Washington H Soul Pattinson & Company has announced a proposed merger via a Scheme of Arrangement with Milton Corp, a listed investment manager with around $3.7bn in assets. Morgan assesses this to be circa 15% net tangible assets (NTA) per share accretive.
The transaction allows the company to continue to diversify its investment base whilst accessing additional liquid assets without having to exit some of its larger positions, explains the broker.
The Hold rating and $28.84 target are unchanged while the analyst awaits the proposed vote on the merger in mid-September.
Sector: Energy.
Target price is $28.84.Current Price is $30.50. Difference: ($1.66) – (brackets indicate current price is over target). If SOL meets the Morgans target it will return approximately -6% (excluding dividends, fees and charges – negative figures indicate an expected loss).
