Insignia Financial’s shares surged to a three-year high on Monday after the Australian financial services company announced an AUD2.87bn ($1.78bn) takeover bid from US-based private investment firm CC Capital Partners, according to a report by Reuters.
The offer surpasses a previous AUD2.67bn bid from private rival buyout firm Bain Capital.
The proposed deal would provide CC Capital, which was founded nearly a decade ago by former Blackstone private equity co-head Chinh Chu, access to Australia’s AUD4.1tn superannuation market, one of the world’s largest private pension systems, and represent CC Capital’s first major Australian investment.
Insignia, a 178-year-old firm previously known as IOOF, rejected Bain Capital’s December offer, stating it undervalued the company. CC Capital’s non-binding bid represents a 7.5% premium over Bain’s offer and a 21.5% premium to Insignia’s Friday closing price of AUD3.54 per share.
In response, Insignia’s shares jumped 11% to AUD3.93 in early trading, their highest level since 2022, though still below CC Capital’s AUD4.30 per share cash offer. Insignia’s board is currently reviewing CC Capital’s proposal to determine if it aligns with shareholder interests.
Insignia offers services in superannuation, financial advice, and asset management, overseeing AUD319.6bn in funds as of September 2024. Its significant market role could position the company as a key asset for any acquirer.
CC Capital’s bid requires approval from Australia’s Foreign Investment Review Board and other regulatory bodies. Bain Capital declined to comment, while CC Capital did not respond to requests for comment, according to Reuters.
