Link (ASX:LNK) shares up on Dye & Durham deal update

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Link (ASX:LNK) shares up on Dye & Durham deal update

Link Administration Holdings Limited shares
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Highlights

  • Link Group targets to complete the deal with Dye & Durham Corporation by July 2022.
  • The group also informed that it received a proposal from FNZ Group (FNZ) to acquire its RSS business.
  • Link Group’s shares were trading in the green on the back of the multiple updates.

Link Administration Holdings Limited (ASX:LNK) (Link Group) has updated ASX today (21 March 2021) regarding its Scheme of Arrangement with Dye & Durham Corporation that it entered on 22 December 2021 (Scheme).

Link Group has also shared that it has received a non-binding indicative proposal from FNZ Group (FNZ) to acquire its Retirement & Superannuation Solutions (RSS) business.

On the back of the news, Link Group's shares were trading 1.4% higher at AU$5.16 apiece at the time of writing this article. This is overperforming ASX 200 Index which is 0.35% up at 7,320.10. Also, information technology is the best performing sector today among seven sectors that are higher today on ASX, gaining over 2.91% and 10.32% for the past five days.

 

What is the update on Dye & Durham Corporation?

  • All regulatory approval applications under the Scheme Implementation Deed have been submitted.
  • The Scheme's explanatory brochure will be submitted to ASIC this week and distributed to Link Group shareholders after the usual ASIC review time and permission from the Supreme Court of New South Wales.
  • This is subject to the outcome of the shareholder vote and receipt of regulatory approvals.
  • Link Group targets to complete the deal by July 2022.

Also Read: Link Administration shares (ASX:LNK) closed over 15% today. Here’s why

Update on non-binding indicative offer for BCM

Link Group refers to LC Financial Holdings' (LCFH) conditional, non-binding indicative proposal (Proposal) to acquire Link Group's Banking and Credit Management (BCM) business, as well as Link group's announcement on February 8, 2022, regarding Link Group and LCFH engaging in exclusive discussions on its Proposal.

However, there has been no binding agreement for the sale of BCM as a result of the discussions between two parties.

Source: © Stokdrozdirina | Megapixl.com

Under the Scheme Introduction Deed, Link Group and Dye & Durham Corporation have pledged to do their best to sell BCM for 12 months following the Scheme's implementation.

Suppose BCM proceeds are received by Link Group within 12 months of implementation. In that case, Link Group and Dye & Durham Corporation intend that the maximum amount Link Group shareholders will be entitled to is 13 cents per Link Group share held on the Scheme Record Date from the BCM Sale Proceeds (as defined in the Scheme Implementation Deed).

Link Group will keep the excess (which, if the Scheme proceeds, will be owned by Dye & Durham Corporation).

Proposal from FNZ Group

Link Group also announced that FNZ Group (FNZ) had made a conditional, non-binding indicative offer to buy its RSS business (RSS Non-Binding Indicative Proposal). The RSS Non-Binding Indicative Proposal is for cash, with the RSS business valued at AU$1.5 billion on a cash-free, debt-free basis, subject to completion adjustments.

Link Group and its advisers have evaluated the RSS Non-Binding Indicative Proposal. It has been decided that it would not result in a more favourable transaction to Link Group shareholders than the Scheme with Dye & Durham Corporation.

Also Read: TLS, TWE, GQG, LNK, PTM: Five ASX-listed shares going ex-dividend today

Bottom line

Dye & Durham believes that the proposed deal will support the company’s growth strategy as the Link Group is highly attractive option for it.

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