Will we be seeing a real bid for Link Administration now that it will let private equity firm Carlyle Group take a look at its books?
The announcement came a week after Carlyle dusted off its pursuit of Link with a $2.8 billion non-binding indicative proposal.
Link says it obtained advice its financial, tax and legal advisors and consulted some shareholders before deciding it was appropriate to provide due diligence information on a non-exclusive basis.
“The Board considers that it is appropriate to provide Carlyle with due diligence information on a non-exclusive basis so that it can develop a revised proposal that is not subject to further due diligence and may be capable of being recommended to shareholders,” Link. told the ASX on Monday.
“The due diligence information will be provided subject to extension of the confidentiality agreement between Link Group and Carlyle, including the standstill,”
“There can be no certainty that such a proposal will eventuate and shareholders do not need to take any action in relation to the Proposal and the Board will update shareholders as appropriate.”
Carlyle has offered to buy all of Link’s shares at $3 a share cash, plus a pro rata distribution of Link’s shareholding in property settlements platform PEXA, valued at $2.38 a share. The $5.38 total is 2 cents a share less than the $5.40 it waved around in late 2020.
The offer, which represented a 24.4% premium on the last closing price of Link’s shares, was subject to a number of conditions including due diligence, negotiation and securing debt financing, Link said in a statement.
Carlyle’s bid is the second time in a year it has sniffed around Link. Back in October 2020 it made an approach with Australian private equity group, Pacific Equity Partners.
Link though rejected that offer, claiming it materially undervalued the businesses and was not in the best interests of shareholders. Link similarly rebuffed a follow-up revised offer from the investment firms.
Two months after the initial Carlyle bid, Link received a $3 billion takeover offer from US firm SS&C Technology. Link rejected this offer as well, claiming it was not compelling enough.
SS&C dropped its offer a month later, in January of this year.
