Generation Development Group to buy Evidentia Group; raising funds
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The news: ASX-listed investment company Generation Development Group (GDG) has agreed to buy investment manager Evidentia Group for $320 million, in a deal that will be part-funded through an equity raise.
The numbers: GDG said the Evidentia deal will be settled by way of $244.9 million in cash consideration and another $75.1 million by way of issuing GDG shares to Evidentia’s key management personnel.
GDG is raising $287.9 million to part fund the transaction. This will comprise of a $114.4 million fully-underwritten placement to institutional investors and another 1-for-7.16 non-renounceable entitlement offer to existing investors. The shares will be issued at $4.15 each, a 10.8% discount to GDG’s last closing price on Friday.
GDG shares were placed in a trading halt ahead of the announcement.
The context: GDG said the acquisition is a highly strategic opportunity, given Evidentia’s status as one of Australia’s fastest growing managed accounts businesses.
Post-acquisition, it plans to merge Evidentia with Lonsec’s investment solutions business to form an undisputed leader in the managed accounts market. Evidentia’s management will be retained post acquisition, with current chief executive Peter Smith to become the executive chair of the expanded managed accounts business.
The deal is expected to be low-double-digit EPS accretive in FY26, the first full-year of ownership, it said.
GDG had acquired full control of investment research and consultancy Lonsec in June 2024.
The source: ASX announcement
