Magellan shares surge on $130m placement for Barrenjoey merger
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The news: Magellan Financial Group’s (MFG) shares surged after emerging from its trading halt for its completed $130 million institutional placement as part of its proposal to merge with Barrenjoey Capital Partners.
The numbers: Magellan shares were up 25.65% to $10.63 at 10:15am AEDT and over the past 12 months have risen 27.21%.
About 15.4 million new shares will be issued under the placement at the price of $8.45 per Magellan share.
Magellan is also offering a $20 million non-underwritten share purchase plan for eligible shareholders.
The context: The proceeds will allow Magellan to acquire an incremental 10% economic interest in Barrenjoey from Barclays.
Following the acquisition, Barclays’ shareholding will be limited to around 4.9% which will simplify the impact of US regulatory requirements on merged companies.
What they said: Magellan chair Andrew Formica said: “We are very pleased to welcome a number of new highly respected investors to the register and view their participation as an endorsement of the merger and future prospects for the group”.
“We are also pleased with the outcome and thank our shareholders and new investors for their strong support for the Placement and the proposed merger with Barrenjoey,” Formica said.
“We view the merger as transformative for MFG and are excited about the potential to create long-term value for our clients and shareholders.”
The source: ASX
