Global equity fund manager VGI Partners Limited has signed a non-binding merger term sheet with specialist alternative investment manager Regal Funds Management.
In an Australian Securities Exchange (ASX) announcement, VGI said it would acquire 100% of Regal in consideration for the issue of new ordinary shares in VGI to existing Regal shareholders, subject to VGI shareholder approval.
However, the proposed merger remained subject to each business completing confirmatory due diligence, negotiation of terms and final board approvals.
After adjusting for cash, liquid assets and other investments, the merged entity would be made up of 60% current Regal shareholders and 40% VGI shareholders.
VGI’s ticker and name was anticipated to change to reflect the combined business.
VGI granted Regal with a six-week period of exclusivity on customary binding terms which include no shop, no talk, and no due diligence restrictions, and an obligation for VGI to notify Regal if it received a competing proposal.
VGI said the merger would provide the following benefits to shareholders:
- The creation of a market-leading alternative investment manager with over $6 billion in funds under management;
- Combining deep industry experience, networks and the long investment track records of industry leaders Robert Luciano and Phillip King;
- Leveraging complementary client profiles and relationships across the combined group, including existing long-term relationships with high-net-worth individuals and family offices within VGI and Regal, alongside a combined retail investor base of 20,000; and
- Opportunity for the investment team to leverage additional resources from the merged group, including Regal’s extensive investment capability and track record investing in Asian equity markets and private unlisted investments.
