A three-way takeover battle is playing out for Insignia Financial, and now there’s even more weighing in on the action.
DataRoom understands that Mercer – and possibly others – are hanging around the hoop in the hope of buying part of the business should the takeover talks collapse or one of the successful bidders is open to a break-up. Appealing to Mercer is believed to be operations within Insignia such as its unit that runs closed plans such as defined benefit schemes.
Mercer’s rivals, such as AMP, are also likely to have raised their head in the hope of gaining a seat at the table for any break-up, sources say. And it makes sense for AMP, given that acquisitions are back on the agenda.
Mercer, part of the New York-listed Marsh McLennan, already operates in that area, having purchased Westpac’s BT Super unit and its Advance Asset Management in 2023.
The Mercer Super Trust is now one of the 15 largest funds in Australia, with about 950,000 members and $65bn of assets under management.
It comes as Brookfield, Bain Capital and CC Capital all carry out due diligence on wealth management business Insignia for a potential buyout proposal.
With the trio all offering $4.60 a share, valuing the target at $2.9bn, the question is whether they walk away or drop their price after examining the company. Many in the market believe this well may be the case, but if anything, with three suitors eyeing the company, shareholders such as John Wylie’s Tanarra Capital will take the view that the business is worth more, not less.
The views of Mr Wylie, who holds about 14 per cent, are important, as he may have enough muscle to block any transaction, and many suspect he now sees the value of the stock at closer to $5.
Bain Capital is advised by Bank of America, CC Capital, Deutsche Bank and Brookfield, Jarden.
Insignia is advised by Citi and Gresham.
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