Perpetual Ltd (PPT)
Are PPT worth holiding onto now. Shareholders will certainly knock back any KKR deal and might they be the subject of a full takeover?
The Latest Q&A
Answer
Hi Colin,
The ATO has ruled unfavourably on the tax treatment of the KKR scheme resulting in PPT’s estimate of the tax liability lifting to $493-529m, nearly 3x prior indications, the difference represents -$3 a share impact on net cash proceeds hence the deal is effectively dead in its current form.
Alternative pathways are now possible, and we do think PPT is a takeover target. Our only reservation is that we are not yet across the intricacies of the ATO guidance i.e. whether or not the same sort of treatment would happen to others if they bought the whole lot and then split out the components like the Trust business, which is what a typical private equity player would do.
- We continue to think PPT is all too hard here.
