Insignia Financial has entered into a scheme implementation deed (SID) with PE bidder CC Capital, although at a lower price than initially bid.
In a statement, the firm said CC Capital has agreed to a cash consideration of $4.80 per share which values the company at $3.3 billion.
This is slightly below the $5 bid by the firm and rival bidder Bain Capital, which withdrew from the process last month, prior to the due diligence period. However, it represents a 56.9 per cent premium to Insignia’s closing share price of $3.06 on 11 December.
This news comes one day after the firm told the ASX that discussions were still “ongoing”.
Insignia acknowledged that CC Capital had conducted a “lengthy and comprehensive due diligence process” which had begun back in March. This was initially expected to last for six weeks but continued into July.
The board of Insignia said it unanimously recommends its shareholders approve the move and it is subject to various conditions being met.
If so, the move is expected to be implemented in the first half of the 2026 calendar year. In certain circumstances that the deal fails to succeed, a break fee or reverse break fee is payable of $33 million.
Insignia Financial’s chairman, Allan Griffiths, said: “The decision to recommend this offer follows extensive work by the board and its advisers to understand the medium-to-long term value of the company, with the board concluding that the offer should be put to shareholders for their consideration.”
Chief executive Scott Hartley said: “This offer recognises the underlying value of the Insignia Financial business, our associated brands including MLC, and our vision to become Australia’s leading and most efficient wealth management company by 2030. We are and will continue to be focused on executing against our strategy and delivering for our customers and shareholders.”
Separately, the firm announced its quarterly flows for the fourth quarter of FY25 which showed funds under management and administration (FUMA) increased by $8.5 billion to $330.3 billion, up from $321.7 billion in the previous quarter.
This was divided between $102.9 billion in wrap, $135.2 billion in master trust, and $92.2 billion in asset management.
Total net inflows were $2.1 billion, driven by flows of $1.2 billion into MLC Expand, $483 million into multi-asset management, and $583 million into institutional direct asset management.
On its wrap division, it said FUA was $102.9 billion, an increase of $5.2 billion over the quarter, which was driven by positive market movement and net underlying inflows of $1.2 billion but offset by pension payments of $707 million.
In asset management, FUM decreased by $2 billion to $92.2 billion as a result of derecognition of $4.8 billion to be divested, partially offset by underlying positive market movement of $1.8 billion and net inflows of $1 billion.
Net inflows into multi-asset products stood at $483 million across its MLC MultiSeries, Index Plus Fund and its managed account solution.
