A week after Platinum indicated it would not pursue Regal’s bid to acquire all of the fund manager’s shares, Platinum confirmed it had decided to grant Regal the right to conduct a process due diligence.
In an ASX announcement on Friday, Platinum said it was entering into an initial period of non-exclusive mutual due diligence with Regal, to enable the latter to improve the value and terms of its proposal.
Due diligence will also enable Platinum to evaluate the absolute and relative value of the Regal stock consideration as well as the costs and benefits of any combination.
“After Regal’s proposal was rejected, Regal contacted Platinum to request due diligence to enable it to submit an improved revised proposal,” Platinum explained.
“The Board remains open to considering proposals for control of Platinum from Regal or other third parties, but will only advance such proposals if they are made on terms that provide appropriate value to Platinum shareholders “added the asset manager.
She stressed that “there is no guarantee that discussions with Regal will progress” or that Regal will submit a revised offer.
In a separate statement, Regal said: “The purpose of this diligence is to further establish the merits and value of the proposed combination and to determine whether an enhanced offer would be in the best interests of Regal’s shareholders and would be accretive to them.”
“Discussions remain preliminary and incomplete, and there is no certainty that they will result in an improved offer or a transaction.”
In an ASX announcement last Thursday, Platinum said it had rejected Regal’s offer as the terms of the proposal undervalued Platinum.
He explained that the board reached this conclusion after considering factors such as the standalone value of Platinum in the context of a possible change of control, its current turnaround strategy and growth plans, the value and the impact of Regal’s proposed equity consideration and the conditional nature of the offer, which would require due diligence, a recommendation from the board of directors and various approvals.
Regal has held a 5.5% stake in Platinum since 2022, which it acquired through a number of smaller acquisitions over a period of a few months.
Separately, Regal said Friday that its FUM increased from $12.3 billion as of June 30 to $17.2 billion as of September 30, 2024, a growth of 41%. According to the company, this increase was driven by a combination of continued net client inflows and positive investment performance across a range of investment strategies.
