Link Group Rejects Revised Buy-out Proposal From Dye & Durham

Link Administration Holdings Limited (LNK) on Monday rejected a A$4.57 per share revised buy-out proposal from Dye & Durham Limited (DND.TO).

Dye & Durham Limited said Wednesday that it made a second revised proposal to Link Administration Holdings Limited with respect to its offer to acquire Link Group. Dye & Durham's latest proposal of up to A$4.70 per Link Group share is comprised of A$4.57 per share in base consideration under the proposed acquisition's scheme implementation deed and up to A$0.13 per share contemplated under the scheme implementation deed for the proceeds from the sale of Link Group's Banking and Credit Management business.

Dye & Durham said in late June 2022 that it reduced its purchase offer price to A$4.30 per Link Group share from A$5.50 per share offered by Dye & Durham in December 2021.

Dye & Durham noted on Wednesday that it reiterated it was not prepared to make any further amendments or alterations to the scheme implementation deed.

Meanwhile, Link Group said Monday that it is continuing to engage with Dye & Durham in relation to whether an agreed position can be reached on the matters raised in Dye & Durham's letters, noting any agreed reduction to the scheme consideration proposed will be subject to Dye & Durham having proposed, and working with the ACCC on an ongoing basis to ensure it puts into effect, undertakings which satisfy the ACCC's concerns.

In the event the proposal does not proceed, Link Group intends to evaluate alternatives for the business, including an in specie distribution of a minimum of 80% of Link Group's shareholding in PEXA, in order to maximize value for shareholders.

Link Group announced its preliminary results for the full year ended 30 June 2022. Slightly above guidance, Link Group's annual revenue was A$1.175 billion, operating EBITDA was A$250 million and Operating EBIT was A$152 million. Link Group intends to release its full year audited results on 30 August 2022.

Looking ahead for fiscal year 2023, the company now projects revenue to increase by a low single digit percentage, operating EBITDA to be around 8-10% higher than fiscal year 2022. Operating EBIT is currently projected to be around 10-12% higher than fiscal year 2022.

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