GQG to counter Regal’s PAC bid, Perpetual suffers outflows

afr.com:

A bidding war between two of the market’s top funds management firms has broken out after GQG Partners said it intended to counter a $555 million bid lobbed by Regal Partners for Pacific Current Group.

Meanwhile, the merits of another funds management merger between Perpetual and Pendal are in further doubt after the bulked up Perpetual revealed worse than expected redemptions in the second quarter.

Rajiv Jain, Founder, Chairman and Chief Investment Officer of GQG Partners. Photograph by Arsineh Houspian. Arsineh Houspian

GQG, which has a market capitalisation of $5 billion after listing on the ASX in 2021 was initially backed by Pacific Current. Regal’s bid, in fact, was in the form of 2.2 GQG shares and $7.50 in cash per each share in Pacific Current.

The GQG share component is because Pacific Current retains a 4 per cent stake in the business allowing Regal to potentially spin-off the stake.

GQG however has yet to reveal its terms other than stating it had had evaluated the PAC portfolio and that it had a strategic vision for unlocking value for PAC shareholders and portfolio companies.

Shares in PAC surged 32 per cent in early trading to $10.32, slightly below the $10.77 implied bid price of Regal. Shares in GQG dipped 1.5 pe cent to $1.635. Regal shares gained 4.7 per cent to $2.67

PAC has minority stakes in ten boutique fund managers such as private lender Victory Park and private equity fund ROC Partners. In total the funds have $120 billion of funds under management, or $13.3 billion when adjusted for its ownership.

Regal Partners which found its way on the ASX via a reverse takeover of VGI Partners has its own growth ambitions and amassed an 12 per cent position in Pacific Current before teaming up with other