Perpetual’s Pendal acquisition completes. Proof of value comes later

Mike Taylor

Managing Editor/Publisher, Financial Newswire

24 January 2023

The proof of the pudding of Perpetual’s just-completed acquisition of Pendal will be in the eating with the flavour of the transaction expected to be appreciated or abhorred in the second half of the year.

In the meantime, shareholders were remarkably unmoved by the announced completion of the transaction with Perpetual shares up 2%.

Perpetual announced that it expected to be able to provide guidance on the combined group as part of its Q3 business update when it incorporates Pendal’s assets under management by asset class and investor channel.

But, in the meantime, shareholders can expect an update on the company’s debt position when it releases its half-year results next month, along with the expected synergies from the transaction and a breakdown of the combined group assets under management.

However, in the meantime, Perpetual is sticking to its forecast of an expected underlying profit after tax for the first half in the range of $65 million to $70 million.

In the board room, existing Perpetual independent non-executive director, Craig Ueland is retiring from the board, while Pendal directors Katshryn Matthew and Christopher Jones will be joining.

Greg Cooper will be succeeding Ueland as chair of the Board Investment Committee.

Commenting on the completion of the transaction, Perpetual managing director and chief executive, Rob Adams said it represented the beginning of an exciting new chapter for both businesses.

“The Perpetual and Pendal businesses are stronger together and are better positioned to invest in and rive our future growth through the expansion of investment capabilities, while benefiting from a step change in scale, ESG capability and our significantly enhanced global operating model,” he said.

“With the transaction now finalised, the new leadership team is focused on delivering our global growth ambitions and executing on the strategic and financial benefits afforded by this transformation acquisition.”

Adams said those benefits included delivering enhanced scale efficiencies, growth in the global distribution footprint, building ESG leadership “and realising $60 million in expected run-rate pre-tax expense synergies”.