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Resimac lifts RHG offer

Resimac has sweetened its bid for RHG, the rump of mortgage lender RAMS, to 48¢ a share. The offer is a direct response to a rival bid last week by mortgage lender Pepper Australia, which also has its eyes on RAMS' loan book. RHG shareholders are now being offered 48¢ a share by Resimac, in addition to a 3¢ dividend the company plans to pay. It compares with a 46¢ a share offer by Pepper, which provides so-called white label mortgages via brokers. RHG's main asset is the lending book of RAMS. RHG shares closed up 2¢ at 51.5¢ each. Clancy Yeates
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InvestSMART
By InvestSMART · 16 Jul 2013
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By InvestSMART ·
16 Jul 2013
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Resimac has sweetened its bid for RHG, the rump of mortgage lender RAMS, to 48¢ a share. The offer is a direct response to a rival bid last week by mortgage lender Pepper Australia, which also has its eyes on RAMS' loan book. RHG shareholders are now being offered 48¢ a share by Resimac, in addition to a 3¢ dividend the company plans to pay. It compares with a 46¢ a share offer by Pepper, which provides so-called white label mortgages via brokers. RHG's main asset is the lending book of RAMS. RHG shares closed up 2¢ at 51.5¢ each.
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Frequently Asked Questions about this Article…

Resimac has sweetened its bid for RHG to 48¢ a share, and RHG shareholders are being offered that price in addition to a 3¢ dividend the company plans to pay.

Resimac's offer is 48¢ a share, which tops rival mortgage lender Pepper Australia's competing bid of 46¢ a share.

Both Resimac and Pepper Australia are targeting RHG because RHG's main asset is the lending book of RAMS, a loan book that both lenders want to acquire.

RHG's main asset is the lending book of RAMS — essentially the portfolio of loans originated by RAMS.

Under Resimac's proposal RHG shareholders would receive 48¢ per share plus the 3¢ dividend that RHG plans to pay.

RHG shares closed up 2¢ following the bidding activity, finishing at 51.5¢ each.

Pepper Australia is a rival mortgage lender that submitted a 46¢ per share bid for RHG and provides so-called white‑label mortgages via brokers.

The key points are that two mortgage lenders have made competing bids for RHG because its main asset is the RAMS loan book; Resimac has offered 48¢ a share plus a planned 3¢ dividend while Pepper offered 46¢, and RHG’s shares rose to 51.5¢ amid the activity.