Brookfield moves to acquire Reliance Worldwide Corporation at a 43% premium

Reliance Worldwide shares are in focus as Brookfield struck a US$3.38 per share takeover deal with a 43% premium and "Go Shop" flexibility.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Reliance Worldwide Corporation Ltd (ASX: RWC) share price is in focus today after the company announced it has entered into a scheme implementation deed with Brookfield, under which Brookfield will acquire 100% of Reliance Worldside shares for US$3.38 per share. This cash offer represents a 43% premium to RWC's six-month VWAP and values the company at an enterprise value of approximately US$2.9 billion, or A$4.75 per share.

two men in suits shake hands at the top of a shined wood boardroom table.

Image source: Getty Images

What did Reliance Worldwide report?

  • Scheme Implementation Deed signed for Brookfield to acquire 100% of RWC shares via a scheme of arrangement
  • Offer price: US$3.38 cash per share (~A$4.75 based on exchange rates)
  • Total enterprise value: approximately US$2.9 billion
  • Premiums: ~43% to six-month VWAP, ~32.7% to three-month VWAP, and ~31.5% to undisturbed price
  • Implied FY26 EV/EBITDA multiple: ~12.1x (post-AASB16)
  • Shareholders can elect to receive payment in AUD or USD at implementation

What else do investors need to know?

The agreement includes a "Go Shop" provision, allowing Reliance Worldwide's board to actively seek out alternative bids until 15 October 2026. This means shareholders have the opportunity to benefit if a superior proposal emerges. After the Go Shop period, standard exclusivity, deal protections, and matching rights apply, including a US$25.3 million break fee and a reverse break fee on the same terms.

Completion of the transaction is subject to shareholder and regulatory approvals, including the Foreign Investment Review Board, ACCC, and equivalent authorities in the US, Germany and Ukraine. An independent expert will report on whether the scheme is in shareholders' best interests.

What did Reliance Worldwide management say?

Reliance Worldwide Chair Russell Chenu said:

The Board is unanimous in its view that this Transaction is in the best interests of RWC shareholders. The Board has carefully assessed the proposal on a fundamental valuation basis, considering RWC's strategic position, long-term growth opportunities and cash generation. The Board also considered the execution risk to deliver future growth, as well as the broader macroeconomic and geopolitical environment, against the certainty of value delivered by the Cash Consideration and unanimously recommends that RWC shareholders vote in favour of the Scheme in the absence of a superior proposal and subject to an Independent Expert concluding that the Scheme is in the best interests of shareholders. In addition, the 'Go Shop' process provides us with the opportunity to explore broader buyer interest in RWC which will allow shareholders to be fully informed when making their decision on the Transaction

What's next for Reliance Worldwide?

The next step for Reliance Worldwide shareholders will be receipt of a Scheme Booklet, expected in November 2026, with full details of the proposal, including the independent expert's report. A Scheme Meeting, where shareholders will vote on the deal, is tentatively scheduled for later in 2026. If the deal is approved and all conditions are met, implementation is targeted for Q1 2027. If completion is delayed past March 2027, a "ticking fee" will accrue to shareholders.

Shareholders are encouraged to take no action until formal materials are received. The board unanimously recommends the proposal, subject to no superior bid and a positive expert report.

Reliance Worldwide share price snapshot

Over the past 12 months, Reliance Worldwide shares have risen 3%, outperforming the S&P/ASX 200 Index (ASX: XJO), which has declined 2% over the same period.

View Original Announcement

Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

More on Real Estate Shares

Image of a shopping centre.
Real Estate Shares

Vicinity Centres: 2026 Capability Showcase highlights Chadstone and Chatswood Chase

Vicinity Centres boasts gains from Chadstone and Chatswood Chase upgrades, highlighting premium asset focus and solid financial health in 2026.

Read more »

Image of a shopping centre.
Real Estate Shares

Stockland shares are sinking 4%. Is this $3.8 million CEO sale a warning sign?

A large CEO sale has put this ASX stock in focus.

Read more »

Model of house and key on sandy beach with sea and sky in the background.
Real Estate Shares

Home values decline for a 5th straight month – what does it mean for ASX real estate shares?

Here's what investors need to know.

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Real Estate Shares

Winton Land shares suspended following board resignations

Winton Land shares have been suspended following board resignations and a shortfall in independent directors.

Read more »

Elderly couple cosily walking together outside.
Real Estate Shares

Summerset Group: HY26 profit up 92% as sales hit record high

Summerset Group delivered record HY26 profit and sales, with a new dividend policy and growth in both NZ and Australia.

Read more »

Magnifying glass in front of an open newspaper with paper houses.
Real Estate Shares

Ingenia Communities proposes to acquire Peet, boosting growth

Ingenia Communities aims to acquire Peet, boosting its housing pipeline and strengthening its national platform.

Read more »

Magnifying glass in front of an open newspaper with paper houses.
Real Estate Shares

Peet FY26 earnings: Profit and dividend surge on record sales

Peet achieved record FY26 results with earnings and dividends up sharply, underpinned by strong project sales and a robust development…

Read more »

Mini house on a laptop.
Earnings Results

Cedar Woods reports record earnings and targets 15% FY27 profit growth

Cedar Woods reported record FY26 profit and dividends, strong presales, and is targeting 15% NPAT growth in FY27.

Read more »