‘Cut them in’: How ASX dealmakers are learning to live with big super
Superannuation funds now manage more money than the market value of the entire ASX. As they increasingly flex their muscles in deal situations, bidders are being warned to adjust.
AustralianSuper’s knockdown of Challenger and KKR’s bid to take Pepper Money private last week is just the latest in a growing list of situations where big super has flexed its muscles in M&A.
And dealmakers are warning bidders that the trend is not going away, and anyone who wants to succeed with a takeover on the ASX of a company with a super fund on its register will need to get creative, and potentially cut them into their deals.
Superannuation assets are collectively worth more than $4 trillion, with a significant proportion of that money tied up in interests across the ASX 200. Super is also now a bigger funding source for Australian companies than banks, according to research from the Association of Superannuation Funds of Australia.
HSFK M&A partner Nicole Pedler told Capital Brief that over the last five years or so, “the complexion of the market has changed” with super funds now likely to hold the key to getting public M&A done, with the most common structure used in takeovers, the scheme of arrangement, requiring shareholder support.
