Private equity group Carlyle has put in a fresh bid for former Woodford Investment Management authorised corporate director Link Group.
Carlyle’s AUD$2.81bn bid prompted Link to put its planned share buyback on hold and sent its shares rallying 12% on Friday.
It is the second time Carlyle Group has made a bid for the shares and funds administration business. In October 2020, it spearheaded a consortium of private equity firms alongside Pacific Equity Partners to snap up 100% of the company’s shares, before dropping its bid in April this year.
It offered AUD$2.8bn at that point too, but Link’s shares have slumped in the period since. Even after Friday’s rally, Link’s shares are down 14% in the year to date. Carlyle’s latest bid for Link was 24.2% higher than its closing price on Thursday with an offer of AUD$3 a share in cash and a distribution of Link’s stake in Pexa worth AUD$2.38 a share.
See also: Takeover bid for Link adds more uncertainty for Woodford investors
Where Link Fund Solutions fits in with the wider group
In the UK funds industry, Link’s name has been tarnished due to the role of Link Fund Solutions as ACD of the Woodford Equity Income fund, which suspended in June 2019 due to liquidity issues. The Financial Conduct Authority is investigating the events leading up to the fund’s suspension and in September Leigh Day confirmed it would be taking Link to court to seek compensation for Woodford Equity Income fund investors.
But the company’s main activities are in Australia and New Zealand and it is the largest provider of superannuation fund administration services in the Australian market.
Private equity interest in Link has been focused on its stake in online conveyancing firm Pexa Group, which taps into the Australian housing market. Fiscal spending and low interest rates have pushed home prices up more than a fifth this year, Reuters reports.
In May, Link rejected a bid from KKR for Pexa and instead listed it on the Australian Stock Exchange in a AUD$907m IPO.
See also: Woodford suspension sparks debate on in-house versus external ACDs
