Shares of ASX-listed Insignia Financial Ltd. (AU:IFL) soared after the company announced a takeover offer from Bain Capital. The non-binding, all-cash takeover offer values Insignia at AU$2.67 billion ($1.7 billion). After the announcement, Insignia shares surged by as much as 9.6% in early trading, reaching their highest level since mid-January 2023. However, shares later pulled back slightly, finishing with a 6.18% gain.
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Insignia is a financial services company that provides a range of solutions to Australians. As of the end of September 2024, the company had AU$319.6 billion in funds under management and administration.
Insignia Financial Reveals Takeover Details
According to Insignia Financial’s update, its shareholders will be offered AU$4.00 per share, reflecting a 17.6% premium over the IFL’s closing price on Thursday. The company further mentioned that it is reviewing the proposal from Bain Capital with its financial and legal advisors to determine if engaging with them is in the best interest of shareholders. However, the company is uncertain whether this initial proposal will lead to a formal, binding offer or result in any deal.
Meanwhile, Brian Freitas, founder of the data analytics company Periscope Analytics, described Bain’s offer as opportunistic and added that the offer might face resistance from Insignia’s board.
In FY24, the company reported a statutory net loss after tax (NPAT) of AU$185.3 million. It also suspended its dividends to maintain strategic flexibility and strengthen the balance sheet.
What Is the Share Price Target for Insignia Financial?
As per the consensus among analysts on TipRanks, IFL stock has been assigned a Hold rating. This is based on two Buys, three Holds, and one Sell recommendation. The Insignia Financial share price target is AU$3.31, which is 8.67% below the current level.
