The MA Financial Group Ltd (ASX: MAF) share price remains on hold today after the company confirmed rumours of a major acquisition.
Shares in the financial services company were trading at $8.45 apiece before the company called a trading halt yesterday.
Let's see what MA Financial revealed to the market this morning.
What did the company announce today?
MA Financial has entered into a binding agreement to acquire 100% of BNK Banking Corp Ltd (ASX: BBC)'s mortgage broker network Finsure for $145 million.
Finsure is a leading Australian mortgage aggregator with a lending portfolio of $60.8 billion, focused on the home lending market.
The acquisition will provide MA Financial lenders with access to 2000 mortgage brokers and 4,800 loan products.
Finsure has experienced nearly 28% growth in the 12 months to September this year.
MA Financial will conduct an institutional placement to raise $100 million. Shares for the placement will be issued to the market at $7.75, an 8.3% discount on the company's $8.45 closing price before the trading halt.
Meanwhile, a share purchase plan for retail shareholders will also be on offer to raise a further $10 million.
Eligible shareholders will be able to purchase up to $30,000 worth of new shares without brokerage fees.
The company has updated its guidance for FY21 in light of the acquisition. MA Financial expects its underlying earnings per share (EPS) growth to exceed the upper end of its 30-40% guidance range.
It also expects its FY22 underlying EPS to be up 15-25% on the FY21 figure, including the Finsure acquisition.
The purchase of Finsure is expected to take place in the first half of 2022 and is subject to regulatory approval,
MA Financial Group share price snap shot
The MA Financial share price has soared 68% in the past 12 months, lifting 78% year to date.
While it's slipped 3.54% in the last month, MA Financial shares gained 3.68% in the past week.
In contrast, the benchmark S&P/ASX 200 Index (ASX: XJO) has returned nearly 11% in the past year.
MA Financial has a market capitalisation of more than $1.3 billion.
