Barrenjoey valuation eyed ahead of Magellan FY numbers
Magellan Financial Group is set to report its annual results next week, giving investors the opportunity to dig into its embattled funds management business. But plenty of scrutiny will be on its most off-piste investment: Barrenjoey Capital Partners.
There’s no question investment banks have been under considerable pressure over the past year as transaction volumes crumble and fees slump.
Barrenjoey chief executive Brian Benari, executive chairman Guy Fowler and non-executive director John Cincotta. Louie Douvis
Thankfully, Australia’s first home-grown investment bank since Macquarie hooked a big fish after Suncorp group put its $5 billion bank in play. Suncorp’s board and management team called in Barrenjoey in June last year, which resulted in ANZ attempting to pull off the biggest Australian banking deal in more than a decade.
Barrenjoey would have been in line for $20 million in fees, sources told Street Talk, representing around 0.4 per cent of the $4.9 billion deal.
But now the tie-up is looking far more complicated than first understood after the competition regulator blocked the acquisition on Friday over fears it would “further entrench an oligopoly” and lead to reduced competition.
Barrenjoey’s best hope for collecting its fee is a successful court challenge after ANZ/Suncorp vowed to appeal the decision to the Australian Competition Tribunal. This will delay a final ruling by around six months.
Barrenjoey last reported a $5.3 million profit for the year ending June 2022. Corporate finance, which includes M&A advisory, and cash equities generated revenue of $226.7 million, and had operating expenses including cost allocations and performance-based remuneration of $166.6 million.
Barrenjoey is owned by
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