How did Link (ASX:LNK) shares react to Dye & Durham’s bid rejection?

July 04, 2022 11:19 AM AEST | By Ashish

How did Link (ASX:LNK) shares react to Dye & Durham’s bid rejection? — Image source: ©Ymgerman | Megapixl.com

Highlights

Link has rejected Dye & Durham Corporation’s latest share bid.

Dye & Durham had lowered its proposal for Link to AU$4.30 from AU$5.50.

However, Link would continue to engage with Dye & Durham.

Link Administration Holdings Ltd (ASX:LNK) on Monday announced the rejection of Dye & Durham Corporation’s latest takeover bid. In its latest ASX update, Link said that it would not recommend Dye & Durham’s AU$4.30 per share transaction for the control of Link Group.

Following this update, Link’s shares were trading at AU$3.78, down 0.39% at 10:25 AM (AEST). The share price has fallen by over 32% on a year-to-date (YTD) basis. Link’s share price has declined over 25% in the past year. The stock is down nearly 12% in the past month. The stock’s 52-week high and low stand at AU$5.60 and AU$3.25, respectively.

Link Group delivers services, solutions and technology platforms to financial market participants.

Dye & Durham on 27 June 2022 lowered its proposal for Link to AU$4.30 from AU$5.50, saying
“it is considering providing an undertaking to the ACCC to obtain its approval as required in the scheme implementation deed.”

According to Link’s update earlier last month, the Australian Competition & Consumer Commission (ACCC) had concerns over the approach mainly on account of Link’s ownership in PEXA Group Ltd (ASX:PXA).

Meanwhile, Link has also declared that it would continue to engage with Dye & Durham “in relation to whether an agreed position can be reached on the matters raised by Dye & Durham.”

“If an undertaking is proposed by Dye & Durham to the ACCC which Link considers will satisfy the ACCC’s concerns, Link’s Board said it would be willing to consider an amendment to the agreed scheme consideration,” added Link.

FY22 guidance

In its outlook for the first half of FY22, Link expected its revenue growth guidance to be in single digits. However, operating earnings before interest and tax (EBIT) rose nearly 5% compared to FY21.

In June, the company reaffirmed its fiscal guidance. The firm’s performance for the first half was higher than its expectations. While revenue rose 0.6%, operating EBIT was 11% higher.

Link has also completed an on-market share buyback in the first half of the financial year 2022. On 8 April FY22, Link’s board declared a fully franked interim dividend of 3 cents per share.

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