What now for CBA’s 35.9% Count stake?
With Diverger shareholders overwhelmingly voting in favour of their company’s acquisition by Count Limited, there is renewed interest in what the Commonwealth Bank intends to do with its remaining 35.9% stake in Count.
Diverger shareholders demonstrated how attractive they found the Count Limited bid with 99.97% of those present voting in favour of the resolution which should now see the transaction complete on 1 March.
Diverger chair, Peter Book referenced the company having “pursued, quite assertively and successfully, a dual growth strategy (little deals and a big deal) with minimal capital and resources”.
“Today is the culmination of our efforts,” he said. “At times it has been stressful and hectic. But the crew has delivered on good operating results, continued growth in dividends every year and engineered a capital transaction that is in accord with the consolidation thesis we consider beneficial to shareholders and the industry and delivered a significant premium to shareholders with the opportunity continue participation.”
The Count bid for Diverger moved forward despite a bid filed COG Financial which, in turn,. Led to an increased bid from Count involving $1.42 per Diverger share plus a permitted fully ranked cash dividend of up to 10 cents per Diverger share.
At the time of announcing its bid for Diverger, Count said that on completion of the transaction Count would become a leading diversified financial services provider with total revenues of $132 million and funds under management and advice (FUMA) of $29 billion.
It said the firm would have 550 financial advisers, 563 aaccountants and a significantly expanded services segment.
Attention has turned to the Commonwealth Bank’s remaining stake in Count Limited because its exposure to remediation indemnities attaching to its 2019 sale of Count Financial to CountPlus are believed to have been mostly addressed.
In December 2022 the bank announced that it had increased the limit of the indemnity it provided to CountPlus (now Count Limited) from $300 million to $520 million) and in February, last year, said it still had $518 million remaining to be paid in customer remediation.
The Commonwealth Bank is scheduled to announce its half-year results and interim dividend on 14 February.
COG will buy it and then buy the rest of CAF. Game over.