The Insignia Financial Ltd (ASX: IFL) share price is catching the eye on Friday.
In morning trade, the ASX 200 financial stock is up 13% to a 52-week high of $4.83.
Why is this ASX 200 financial stock rocketing?
Investors have been bidding the diversified financial services company's shares higher today after it received two new takeover offers.
According to the release, Insignia Financial has received separate revised non-binding and indicative proposals from both Bain Capital Private Equity and CC Capital Partners to acquire all shares in the company by way of a scheme of arrangement.
The release reveals that both bidders have separately and independently submitted increased proposals at a price of $5.00 cash per share. This will be adjusted for any dividend paid or payable after the date of the proposals.
The good news for the bidders on this occasion is that the ASX 200 financial stock believes that these offers are finally "attractive" for shareholders. The company stated:
After careful consideration, the Board has determined the terms of each Proposal to be attractive for Insignia Financial shareholders and has concluded that it would be in the best interests of Insignia Financial shareholders that Insignia Financial enter into an Exclusivity Deed with each of Bain and CC Capital (each an "Exclusivity Deed") to further progress their respective Proposals.
As a result, the Insignia Financial board will provide both parties with access to confirmatory due diligence that is expected to be completed within six weeks.
Improved offers
The revised proposals from Bain Capital CC Capital of $5.00 per share represent an increase of 8.7% from the $4.60 per share offers that were previously tabled.
The company notes that the cash consideration under each proposal also represents a premium of 63% to where the Insignia Financial share price was trading back on 11 December 2024, which was the last trading day before the announcement of the receipt of a proposal from Bain Capital.
It is also a premium of 56% to the volume-weighted average price (VWAP) of Insignia Financial shares for the one month up to and including 11 December 2024 and a premium of 77% to the three-month VWAP.
Though, just because the offers have been labelled as attractive doesn't mean that a deal will be done.
The proposals remain subject to various conditions. This includes satisfactory completion of the due diligence, a unanimous recommendation from the Insignia Board, no superior proposal being tabled, the independent expert concluding that the applicable proposal is in the best interests of shareholders, and final investment committee approval from either Bain or CC Capital.
In addition, any transaction would be subject to approval of the Australian Prudential Regulation Authority, the Foreign Investment Review Board, and ultimately shareholders.
The Insignia Financial share price is now up 94% over the past 12 months.
