ASX 200 rises, Challenger soars, Zip jumps

The ASX 200 went up, with the Challenger share price surging.

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The S&P/ASX 200 Index (ASX: XJO) went up by 0.9% to 7,327 points.

Here are some of the highlights from the ASX today:

Challenger Ltd (ASX: CGF)

The Challenger share price went up 8.8% today in response to shareholder news.

It was announced today that Athene, a leading international retirement services company, as well as strategic partner Apollo Global Management, have agreed to buy a 15% minority interest in Challenger from an existing approval. It requires regulatory approval for 3%.

When combined with other Challenger shares acquired by Athene and Apollo, the acquisition of the 15% equity interest will result in a total expected minority economic interest of 18% of the ASX 200 share for approximately US$540 million.

Athene and Apollo said they see attractive long-term attractive opportunities in partnering with and supporting Challenger’s continued growth as minority shareholders.

Challenger’s managing director and CEO Richard Howes said:

Today’s announcement by Athene is a strong endorsement of Challenger’s market position and long-term growth prospects from a leading international retirement services provider. We look forward to working with Athene and Apollo as we continue to pursue our shared purpose of providing customers financial security for a better retirement.

The Athene CEO Jim Belardi said:

Investing in Challenger represents an exciting opportunity for us to support a well-established platform within the Australian market, a geography we have been studying given the current economic conditions and compelling demographic fundamentals.

In many ways, Challenger is the perfect partner for us – the company is led by an experienced management team, has a strong market position, attractive growth prospects, and shares our deep commitment to retirees. Together, we believe we can help Challenger continue to build long-term value, similar to what we’ve been able to achieve in building Athene’s business in the US and supporting the growth of our sister company Athora in Europe, where we are also minority shareholders.

Popular ASX shares

Some of the ASX 200’s most followed ASX shares saw the most share price growth today.

The Zip Co Ltd (ASX: Z1P) share price went up 6.5%. The buy now, pay later company was one of the strongest performers within the ASX 200.

Other businesses that also were among the leading gains included A2 Milk Company Ltd (ASX: A2M), which rose by around 6%, and the Pointsbet Holdings Ltd (ASX: PBH) share price rose by around 4.8%.

Outside of the top five performers, the Afterpay Ltd (ASX: APT) share price rose around 4.5% and the Xero Limited (ASX: XRO) share price climbed around 4%.

Magellan Financial Group Ltd (ASX: MFG)

The Magellan share price rose by around 0.2% today after giving investors an update.

The ASX 200 fund manager said that for the quarter ending 30 June 2021, its total funds under management (FUM) increased to $113.9 billion, up from $106 billion at 31 March 2021.

For the last quarter of FY21, Magellan experienced net outflows of $351 million, which comprised of net retail outflows of $260 million and net institutional outflows of $91 million.

Magellan funds will pay distributions (net of reinvestment) of approximately $438 million in July, which will be reflected in the FUM figures in next month’s announcement.

The fund manager also said it’s entitled to estimated performance fees of approximately $30 million for the year ended 30 June 2021.

Average FUM for FY21 was $103.7 billion, up from $95.5 billion for the year ended 30 June 2020.

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Motley Fool contributor Tristan Harrison owns shares of Magellan Financial Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO, Pointsbet Holdings Ltd, Xero, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO, Challenger Limited, and Xero. The Motley Fool Australia has recommended A2 Milk and Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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