A week after Platinum indicated it would not be going forward with Regal’s bid to acquire all shares in the fund manager, Platinum confirmed it has decided to grant Regal the right to carry out a due diligence process.
In an ASX announcement on Friday, Platinum announced it is entering into an initial period of non-exclusive, mutual due diligence with Regal, to allow the latter to improve the value and terms of its proposal.
The due diligence will also allow Platinum the opportunity to assess the absolute and relative value of Regal share consideration and the costs and benefits of any combination.
“Following rejection of the Regal proposal, Regal approached Platinum with a request that it be granted due diligence in order to allow it to submit an improved revised proposal,” Platinum explained.
“The board remains open to considering control proposals for Platinum from Regal or other third parties, but will only progress any such proposals if they are on terms that deliver appropriate value for Platinum shareholders,” the asset manager added.
It stressed that “there is no guarantee that discussions with Regal will progress” or that Regal will submit a revised bid.
In a separate statement, Regal said: “The purpose of this diligence is to further establish the merits and value of the proposed combination and determine whether any improved offer would be in the best interest of, and accretive to, Regal shareholders.
“The discussions remain preliminary and incomplete, and there is no certainty that they will lead to an improved offer or a transaction.”
In an ASX announcement last Thursday, Platinum said it had rejected Regal’s bid given the terms of the proposal undervalued Platinum.
It explained the board arrived at the conclusion after considering factors such as Platinum’s standalone value in a potential change of control, its current turnaround strategy and growth plans, the value and impact of Regal’s share consideration proposal, and the conditional nature of the offer, which would require due diligence, board recommendation, and various approvals.
Regal has had a 5.5 per cent stake in Platinum since 2022, which it acquired via a number of smaller acquisitions over a period of a few months.
Separately on Friday, Regal said its FUM rose from $12.3 billion at 30 June to $17.2 billion at 30 September 2024 – marking a 41 per cent growth. According to the firm, the increase was driven by a combination of continued net client inflows and positive investment performance across a range of investment strategies.
