American private equity firm Bain Capital has made a takeover bid for Insignia Financial Ltd that values the Australian financial services firm at $2.7 billion.
Insignia Financial said Bain Capital had made an indicative proposal to pay $4 cash per share under a scheme of arrangement.
Insignia said its board and financial and legal advisers were considering the proposal to assess whether it was in the best interests of shareholders to engage with Bain Capital.
“There is no certainty that the indicative proposal will result in a binding offer or that any transaction will eventuate,” the company said in an ASX announcement.
“IFL shareholders do not need to take any action in relation to the Indicative Proposal. Insignia Financial will continue to keep the market informed in accordance with its continuous disclosure obligations.”
The proposal is subject to conditions including completion of exclusive due diligence, execution of a binding implementation agreement, unanimous board recommendation, and a commitment from directors to vote in favour of it.
At 1pm (AEDT) Insignia (ASX: IFL) shares were trading below the bid price at $3.72, up 32 cents (9.41%) from the previous close, after trading between $3.49 and $3.72, and valuing the company at $2.5 billion.
Insignia provides investment, superannuation, financial advice and wealth management services and has $312 billion of funds under management and advice.
Rebranded in 2021 after being known as IOOF Holdings, the organisation has roots dating back 1846 when as it was founded as the Independent Order of Odd Fellows, a friendly society that helped people in times of hardship.
Bain Capital also owns Australia’s second largest airline Virgin Australia, which it bought in 2020 after Virgin collapsed.