The Insignia Financial Ltd (ASX: IFL) share price is up more than 12% after receiving a larger proposal from CC Capital.
Insignia Financial says it’s a leading Australian wealth manager, providing financial advice, superannuation, wrap platforms and asset management services to members, financial advisers and corporate employers.
Larger takeover offer
Insignia Financial announced to the ASX that on 3 January 2025 it received a confidential, non-binding and indicative proposal from CC Capital Partners to buy the entire business for a price of A$4.30 cash per share, reduced by any dividends, or the potential alternative of rolling into unlisted stub equity subject to caps and scale-back. In other words, investors could choose to continue owning their share of Insignia as a private business.
This larger offer from CC Capital Partners represents a 7.5% premium to Bain Capital’s non-binding indicative proposal of $4.00 cash per share received on 12 December 2024.
The CC Capital Partners proposal is subject to a number of conditions including satisfactory completion of due diligence on an exclusive basis.
The offer would also require unanimous recommendation from the Insignia Financial board of directors and commitment from all directors to vote in favour of the transaction, assuming there isn’t a better proposal and that an independent expert concludes the transaction is in the best interests of the owners of Insignia shares, and approval by CC Capital’s investment committee.
If Insignia Financial does want to accept this new offer, it would be subject to the approval of the Foreign Investment Review Board (FIRB) and the Australian Prudential Regulation Authority.
Thoughts on Insignia shares
The board of the ASX share is considering this offer, along with advisors Citigroup, Gresham Advisory Partners and King & Wood Mallesons.
Insignia noted there is no certainty this offer will result in a binding offer or that a takeover will eventuate.
The company said shareholders don’t need to do anything and it will keep the market informed.
This is exciting for investors because it may be the start of a bidding war. If I were a shareholder, I’d want to hold for a bit longer to see if Bain comes back with a better bid. After an eventual sale, I’d put the money towards a good ASX dividend share.
