AUB Group Limited’s talks with EQT AB and CVC Asia Pacific have officially concluded, and this was confirmed by the Company after the Consortium decided not to move forward with a binding proposal. The Consortium had presented a non-public, non-binding, and secret proposal to acquire 100% of AUB at a cash price of $45.00 per share.
The AUB Board remarked that the offer price of $45.00 per share signified the correct value of the Company given the existing market conditions. The Consortium informed that it would not continue with the offer, and as a result, both sides agreed to discontinue the AUB Group merger conversations.
AUB confirms EQT and CVC talks end after the $45 offer is withdrawn.
What Was Offered In The AUB EQT CVC Deal?
The initial proposal included a scheme of arrangement for the complete takeover of AUB at $45.00 per share. The proposal was still non-binding, yet it caused an extensive due diligence process to start. AUB reported that this review was hard but beneficial.
It made the management team’s confidence in the Company’s strategic direction and improvement initiatives stronger. The offer had the power to alter the acquisition update landscape of the AUB Group drastically, but its withdrawal transfers future growth completely back to AUB.
How Has AUB Responded To The Withdrawal?
Michael Emmett, AUB’s Chief Executive Officer and Managing Director, lauded the Company’s fortitude throughout the entire procedure. He stated the Group is still performing very well owing to disciplined execution and a definite strategy.
Emmett remarked that the due diligence had uplifted their confidence in growth initiatives and long-term prospects. With the end of the AUB EQT CVC deal, management is now concentrated on organic growth and selective acquisition opportunities in its network.
Emmett praises AUB’s resilience and disciplined strategic performance.
AUB Reaffirms FY26 Financial Guidance
AUB has reiterated its circa FY26 guidance for net profit after tax (NPAT) before one-off items. The firm is still expecting outputs amounting to AUD215 million – AUD227 million. The predicted result is an increase in profits of 7.4% – 13.4%.
The re-stated guidance reflects the Company’s trust in the carrying strength of its measures, even though the merger talks have ceased. The management can also see a bright future not only for FY27 but also for the subsequent years as the demand for the insurance broking and underwriting markets continues.
AUB Continues To Pursue Organic Growth Plans
The board and the management of the Company are still convinced of the need for a range of organic initiatives. These initiatives include raising productivity, making the service more efficient and securing the Group’s long-term growth prospects.
The market for acquisitions would also continue to offer good opportunities. AUB contemplates that the present market environment is conducive to the expansion of its already vast broker and agency network.
The Group anticipates that the adoption of this strategy will lead to the generation of extra shareholder value, with the uncertainty regarding the AUB Group acquisition notification having been removed.
AUB leadership remains committed to organic growth and efficiency initiatives.
AUB Group’s Scale Supports Future Growth Prospects
AUB Group is an ASX200 Company whose operations span about 579 locations. It has a workforce of slightly more than 6,000 people who help about 1.2 million clients. The Group also has contracts with Australian and foreign insurers amounting to over $11bn in insurance premiums.
Thus, the scale provides strong grounding for its next growth phase. The Company expects to leverage its key asset, a strong network, to find new opportunities not only in FY26 but also in the years to come after the takeover talks’ end.
Also Read: AUB Group FY25 Results Show Record Earnings Growth
FAQs
Q1: What were the reasons for the Consortium to stop talks with AUB?
By the Consortium, it was decided not to make a binding offer above the price of $45.00 per share.
Q2: Was AUB in favour of the price offered?
Yes, indeed. The AUB Board’s opinion was that $45.00 per share was a fair price for the Group under the current circumstances.
Q3: What are AUB’s earnings expectations for FY26?
AUB confirmed its guidance for underlying NPAT in the range of AUD215.0 million to AUD227.0 million.
Q4: What is AUB’s next step after the deal failure?
AUB is now putting emphasis on the organic growth initiatives and the acquisition opportunities that are selective in nature.
