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Halt to takeover talks
By Narayanan Somasundaram |
December 21, 2010, Tuesday
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Print Edition
Print Edition
AUSTRALIAN wealth manager Perpetual has called off talks with private equity firm Kohlberg Kravis Roberts & Co over a US$1.7 billion takeover, saying the approach undervalued the company, knocking its shares down by nearly 15 percent.
KKR made an indicative bid of A$38 (US$37.68) to A$40 per Perpetual share in October, eyeing a slice of the US$1.2 trillion Australian wealth management sector. It was only willing to raise that slightly after looking at limited data, sources said earlier this month.
The Australian wealth management industry is among the few growing parts of the country's financial services sector, thanks to compulsory private pension schemes leading to several deals including the latest US$13 billion takeover offer of AXA Asia Pacific by AMP.
Perpetual, founded in 1885, called the initial offer low and said it would now end all discussions with KKR after it failed to get an acceptable price.
A successful offer could have led to further consolidation in the world's fourth-largest wealth management industry but investors said KKR will likely remain in the market for other Australian wealth management assets.
KKR made an indicative bid of A$38 (US$37.68) to A$40 per Perpetual share in October, eyeing a slice of the US$1.2 trillion Australian wealth management sector. It was only willing to raise that slightly after looking at limited data, sources said earlier this month.
The Australian wealth management industry is among the few growing parts of the country's financial services sector, thanks to compulsory private pension schemes leading to several deals including the latest US$13 billion takeover offer of AXA Asia Pacific by AMP.
Perpetual, founded in 1885, called the initial offer low and said it would now end all discussions with KKR after it failed to get an acceptable price.
A successful offer could have led to further consolidation in the world's fourth-largest wealth management industry but investors said KKR will likely remain in the market for other Australian wealth management assets.
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