Shares in ASX listed financial services group Perpetual Limited fell 15% on Monday after its board rejected a revised $2.6 billion takeover proposal from Swedish private equity firm EQT. The $22.50 per share offer was the same price EQT put forward on July 27, with the only sweetener being permission for Perpetual to pay a dividend of up to 60 cents per share for the half to December 31 on top. EQT called it its best and final offer in the absence of a competing bid.
The board said the price undervalued the wealth manager and that assumptions underpinning the proposal carried an "unacceptable degree of transaction execution risk". Investors were unconvinced. Several shareholders told the AFR the rejection was unjustifiable and called for the board led by Greg Cooper to be replaced. One argued the offer was effectively worth $23.73 once the recently paid 63-cent dividend and the additional 60 cents were included.
Perpetual will now focus on its corporate trust and asset management businesses, which include boutiques Pendal, Barrow Hanley and J O Hambro. The sale of its wealth management arm remains on track to complete by the end of 2026, after which Perpetual expects to hold net cash and has flagged further capital management alongside dividends. The company returned to a $89 million net profit in the year to June 30, up from a $58 million loss, on flat revenue of $1.37 billion.
The rejection is being read as the end of an interest that dates back to 2022, when EQT bid for Perpetual's corporate trust unit alongside hedge fund Regal Partners. That attempt failed too. Now, after four offers in under three months, the board has to show its standalone plan is worth more than $22.50 a share.
