Westpac has announced it will divest its remaining 9.5% stake in Pendal and that there could be a loss of funds managed by the firm following a strategic review.
In an announcement to the Australian Securities Exchange (ASX) on Wednesday, the firm said the offer price for the shares was $5.98 per share which was a discount of 4% to Pendal’s latest closing price of $6.23.
The firm had previously held share sales in 2007, 2015, and 2017 and had indicated back in 2017 that it would divest the remaining stake “at some future date”.
Gary Thursby, acting chief financial officer at Westpac, said the decision had been taken as the firm wanted to simplify its operations and focus on its Australian and New Zealand business.
Some $1.5 billion in funds under management was withdrawn from Pendal in April 2019 and $1 billion was withdrawn in February 2020. Two further withdrawals were due to be made later this year and in 2021 of $1 billion and $80 million respectively.
It was currently undergoing a strategic review of the wealth business and Westpac said there could be an impact on the Pendal funds business, which managed $14 billion for Westpac.
“Following this review, there may be a loss of some or all of the funds that Pendal manages on behalf of the Westpac Group. As these businesses are currently undergoing a strategic review, it is too early to determine if there will be any impact on the Westpac Group funds managed by Pendal,” it said.