WAM Capital has made an off-market takeover bid to acquire the PM Capital Asian Opportunities fund (PAF).
There was already a proposed scheme of arrangement for PAF in place with PM Capital Global Opportunities fund (PGF) but WAM said its offer represented a premium to this with all accepting PAF shareholders receiving one WAM Capital share for every 1.99 PAF share they owned.
There was also the potential for this to be increased to every 1.975 PAF share which would represent a 10.6% premium to the 27 September, 2021, closing share price for PAF.
WAM chairman, Geoff Wilson, said: “WAM Capital’s offer is clearly superior to the proposed scheme and we look forward to PAF’s board committee recommending our offer to all PAF shareholders. It is our view that the PAF board of directors have not explored all avenues to extract maximum value for PAF shareholders”.
The scheme between PGF and PAF also provided a break fee of $500,000 payable by each of PAF and PGF to the other party in certain circumstances when the scheme did not proceed, a step Wilson said was “illogical and uncommercial”.
“The break fee payable by PAF shareholders, in the event the scheme does not proceed, is illogical and uncommercial,” Wilson said.
“It would appear the break fee was implemented to stifle a public and transparent process to the benefit of the investment manager, PM Capital Ltd.”