While the broader ASX market has fallen heavily in the past few days, the administration services company’s shares are pushing 1.67% higher to $4.86.
The Link share price is on the move today after the company provided investors with updates on its previously announced Pepper European Servicing (PES) takeover, and demerger of its investment in Property Exchange Australia Limited (PEXA).
In today’s release, Link advised that it will exercise its right to terminate the binding agreement to acquire PES. This comes after the transaction, pending regulatory approvals and commercial conditions, lapsed the expiry date.
Previously, Link entered into a binding agreement on 30 January, 2020, to takeover PES from the Pepper Group for £165 million.
Based in London, PES provides end-to-end loan servicing and asset management in residential and commercial sectors throughout Europe.
In additional news, Link also revealed that the trade sale process of PEXA is tracking along well.
The company stated that it will put forward the trade sale process to maximise value for shareholders. Link will demerge its investment in PEXA through the sale of its shares and shareholder loans. Furthermore, the company said that the refinancing of its external debt will no longer go ahead.
Words from the head of Link
Commenting on the updates, Link Group CEO & managing director Vivek Bhatia said:
The Link Group business is resilient with strong foundations. We have a clear strategic focus to simplify the business, deliver the global transformation program and maintain a strong balance sheet. As a result of the termination of the PES transaction, we will preserve the capital for future growth opportunities.
The board is committed to maximising the value of its interest in PEXA for Link Group’s shareholders. PEXA’s cash balance continues to strengthen month-on-month highlighting the strong cash-flow conversion of this investment.
About the Link share price
The Link share price has underperformed over the past 12 months, with its shares down 25%.
Having reached a 52-week high of $6.65 last January, the company’s shares took a steep dive in the following months. During the coronavirus-led market meltdown in March, its shares hit an all-time low of $2.64 before gradually climbing over time.
Based on the current share price, Link commands a market capitalisation of roughly $2.5 billion.