The Perpetual Limited (ASX: PPT) share price is up 8.92% this afternoon. It follows the announcement of an attempted takeover bid which has since been rejected by the company.
Shares in the ASX financial services company currently trade for $29.30. Earlier today shares reached a high of $29.62 and a low of $27.95.
Let's cover today's announcement.
What happened?
Perpetual has turned down the offer from a consortium comprising BPEA Private Equity Fund VIII and Regal Partners Limited, describing the initial offer of $30 per share as "materially" undervaluing the company.
Instead, the company states it is committed to proceeding with its acquisition of Pendal Group Ltd (ASX: PDL). We first heard about this acquisition back in August.
The Fool reported that if the Pendal acquisition goes through, it will provide Perpetual with $200 billion in funds under management. Pendal shareholders on the other hand will receive 1 Perpetual share plus $1.976 in cash for each share held.
Perpetual CEO Rob Adams made the following comments about the Pendal deal back in August:
[The deal allows] us to realise our strategic ambitions significantly sooner than would otherwise occur individually, bringing forward years of growth potential.
The consortium's plans
The rejected consortium sought to buy 100% of Perpetual's fully paid ordinary shares. Regal saw an opportunity in its asset management business with the intention of "accelerating the growth and scale of its current investment and distribution platform".
If the deal went ahead, Regal would have taken over Perpetual's asset management businesses. While the BPEA EQT Fund would acquire Perpetual's corporate trust and private clients businesses.
Crucially, the consortium also noted that its offer was better than Perpetual's plan to acquire Pendal, describing it as delivering a "superior" outcome for Perpetual shareholders.
Perpetual share price snapshot
The Perpetual share price is down around 20% year to date. That's an underperformance of the S&P/ASX 200 Index (ASX: XJO), which is down only 8% over the same period.
The company's market capitalisation is around $1.54 billion.
