Shares in Australia’s Smartgroup surge on $1bn takeover bid

Shares in Australian administration services company Smartgroup surged on Wednesday on an all-cash takeover bid worth AUD1.38bn ($1bn) from a TPG Global-led consortium.

The company said a consortium comprising of US private equity firm TPG Global and its Australian peer, Potentia Capital, offered AUD10.35 per share to acquire 100% of shares in the firm.

Smartgroup shares jumped 16.5% to AUD9.16 to a near two-year high on Wednesday. The offer price of AUD10.35 per share represents a 31.7% premium to its last close.

Due diligence period granted

The TPG-led consortium has been granted four weeks to conduct due diligence on an exclusive basis, the company added.

Smartgroup’s board said it intends to unanimously recommend that shareholders vote in favour of the proposal, in the absence of a superior offer.

The company’s board said there is no certainty that the proposal will result in an takeover offer for Smartgroup, with the offer subject to several conditions including due diligence conclusion and final approval of Smartgroup’s board.

Aware Super participates as an equity co-investor

Smartgroup appointed Macquarie Capital as its financial adviser and Herbert Smith Freehills as its legal adviser.

According to the consortium, Aware Super will participate in the takeover offer as an equity co-investor.

Read more: Gold miners Agnico Eagle and Kirkland Lake in Cbn deal

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