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Aberdeen Aberdeen climbs 5% as analysts suggest £5bn takeover price

Discussion in 'Market News' started by Lily, Jun 20, 2016.

  1. Lily

    Lily Forum Member

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    Company subject to bid talk and Numis says 40% premium would be needed

    With financial shares heading higher as Brexit fears recede, Aberdeen Asset Management is among the biggest gainers.

    The company, more than 5% better at 281.5p, has been the subject of takeover speculation recently, and analysts at Numis have taken a look at possible buyers and a takeout price. In short, major global asset managers and 380p a share or £5bn respectively. Numis said:

    Following recent press speculation that the company is up for sale and a number of parties have taken an informal look, as well as our recent note highlighting the scope for an increased level of sector M&A (given a weak organic earnings growth outlook), we have taken a look at who we think could buy Aberdeen and how much we think they could pay.

    We conclude that an acquirer would need to be fairly large (probably a global top 40 asset manager to have at least equal scale with Aberdeen and allow scope for reasonable cost synergies), have willingness to acquire / access to capital (ruling out some of the bank owned asset managers), have some similarity in investment approach / business model / culture and would probably lack a significant emerging markets/Asia franchise but would want one (Aberdeen’s key strategic asset that most companies would want exposure to long term in our view).

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