Smartgroup shares rocket on TPG’s $ 1.4 billion takeover offer

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Silvo Barac, investor in Smartgroup, responsible for River Capital shares, said the offer seemed good enough to get him to vote in favor.

“It’s a good price and it seems fair to me,” Mr. Barac said. “This board would not have considered bringing this to shareholders if they did not think there was a good chance of the deal going through.”

He hoped the due diligence process would be relatively straightforward and quick, saying Smartgroup’s balance sheet was “clean” and believing that the consortium would have done most of the hard work before launching a bid.

Aware Super joins the party

While TPG Global and Potential Capital lead the consortium, they have informed Smartgroup that Aware Super – which also helped privatize Telco Vocus earlier this year – will be a co-investor.

The consortium receives its advice from Bank of America and Gilbert + Tobin, while Smartgroup has Macquarie Capital and Herbert Smith Freehills in its corner.

Smartgroup, which reports on a calendar year cycle, generated $ 109 million in revenue in the six months leading up to June 30. Earnings before interest, taxes, depreciation and amortization for the period was $ 48 million.

Profit after tax was $ 26.6 million in the half year, and chief executive Tim Looi said there was strong momentum behind the business despite COVID-19.

“While the current economic disruption caused by the COVID-19 pandemic is likely to negatively impact vehicle orders, Smartgroup’s business is in good operational shape and we are well positioned for continued recovery and growth. controls when blockages are released, ”he said.


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