The Link Administration Holdings Ltd (ASX: LNK) share price is edging higher on Monday.
In morning trade, the administration services company's shares are up 1% to $4.07.
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Why is the Link share price rising today?
The Link share price is rising on Monday despite the release of an update on the Dye & Durham takeover approach.
Last week Dye & Durham sweetened its revised proposal by increasing it from $4.30 per share to $4.57 per share. However, this was still a long way from its original offer of $5.50 per share.
Upon receipt of the latest offer, Link revealed that it would consider Dye & Durham's revised offer, including obtaining advice from its advisers.
According to today's update, the Link board has decided that it is unable to recommend a $4.57 per share transaction.
It advised that this decision was based on factors such as feedback from a wide range of stakeholders, the range which the Independent Expert has determined to be the full underlying value of its shares, changes in market valuations of PEXA Group Ltd (ASX: PXA), and alternatives available to Link if a transaction with Dye & Durham does not proceed.
Link is continuing to engage with Dye & Durham. But if a deal is not reached, the company plans to evaluate alternatives for the business. This includes an in specie distribution of a minimum of 80% of Link's shareholding in PEXA, in order to maximise value for shareholders.
Earnings update and guidance
Offsetting this news and helping to boost the Link share price higher is news that the company expects to outperform its guidance in FY 2022.
The release reveals that the company is expecting to report revenue of $1,175 million, operating EBITDA of $250 million, and operating EBIT of $152 million in FY 2022. This is slightly ahead of guidance.
Looking ahead, in FY 2023 Link expects revenue to increase by a low single digit percentage, operating EBITDA is currently projected to be around 8-10% higher, and operating EBIT is currently projected to be around 10-12% higher.
