Pepper adds RHG spice
Two days after RHG urged its shareholders to support a 44.1¢-a-share takeover bid from Resimac, Pepper swooped with an offer of 46¢ a share for the business on Wednesday.
Under the latest proposal, RHG shareholders would receive a total of $142 million for the company - while RHG is also set to pay a separate dividend of 3¢ a share.
In afternoon trading on Wednesday, some shares changed hands at 50¢ - indicating some investors expect Resimac to come back with a higher bid for RHG. The stock closed at 49¢, in line with the latest bid plus the dividend payment.
Wilson Asset Management, which owns 3.37 per cent of RHG after upping its stake in recent days, welcomed the prospect of a "bidding war" for the company.
"When two people want an asset, who knows where the price goes? It's going to go to the highest bidder," chairman Geoff Wilson said.
RHG's main asset is the lending book of RAMS, which was a competitor of the big banks before the global financial crisis.
Frequently Asked Questions about this Article…
Resimac launched a takeover bid of 44.1c a share and, two days later, Pepper Australia made a rival offer of 46c a share. The latest proposal also includes a separate 3c a share dividend.
Under the latest proposal tied to the 46c offer, RHG shareholders would receive a total of $142 million for the company, plus a separate dividend payment of 3c a share.
Some shares changed hands at 50c as investors appeared to bet that Resimac might raise its 44.1c bid in response to Pepper's 46c rival offer. The stock later closed at 49c, which aligns with the latest bid plus the 3c dividend.
Wilson Asset Management, which increased its stake to own 3.37% of RHG, welcomed the prospect of a bidding war. Chairman Geoff Wilson said: 'When two people want an asset, who knows where the price goes? It's going to go to the highest bidder.'
RHG's main asset is the lending book of RAMS. RAMS was a competitor to the big banks before the global financial crisis, which helps explain buyer interest in RHG's loan portfolio.
The separate 3c dividend is being factored into market pricing: the stock closed at 49c, consistent with the latest 46c bid plus the 3c dividend, and some trading at 50c signaled expectations of higher offers.
Pepper's 46c rival offer has prompted investors and at least one major shareholder to anticipate a possible bidding war. While market moves suggest expectations of a higher counter-bid from Resimac, the article does not confirm a final outcome.
Investors should watch for any revised bids (for example, a higher offer from Resimac), announcements about the 3c dividend, and trading-price moves—these developments will influence RHG's share price and the final takeover terms.
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