Australia's ASX considering bid for Link

By Staff Reporter

Jun 01, 2012 12:23 PM EDT

Australia's bourse operator, ASX Ltd (ASX.AX), said on Friday it may buy share registry Link Market Services from Pacific Equity Partners in a deal that could be worth as much as $1.36 billion and pit ASX against global buyout firms.

A successful deal by Pacific Equity Partners (PEP), Australia's top private equity firm, will be Asia's biggest sale of a private equity stake so far this year and may spur more buyout shops to cash in on their investments.

Other interested bidders for Link include global private equity firms Bain Capital, Blackstone Group L.P. (BX.N), Carlyle Group (CG.O), U.S.-based Hellman & Friedman, and KKR & Co L.P. (KKR.N), sources with direct knowledge of the matter said previously.

PEP, which has hired Goldman Sachs to advise on the deal, bought Link from ASX seven years ago and has made about 20 acquisitions since 2005, including buying the U.S. business American Stock Transfer & Trust Co (AST). Link manages more than 10 million accounts in Australasia.

ASX, which last year agreed to a takeover by Singapore Exchange (SGXL.SI) only to see that turned down by Australian regulators, said it signed a confidentiality agreement to receive information on Link "ahead of a formal sale process."

"There is no certainty that ASX will participate in a transaction or that any negotiations or due diligence that could result in a transaction will be undertaken by ASX," the bourse operator said.

Last month, PEP started an auction for Link Group, which includes Link Market Services and AST, that could value the company at as much as A$1.4 billion ($1.36 billion) including debt, sources told Reuters. Link competes with Computershare (CPU.AX) In Australia.

PEP plans to retain a small minority stake in the company sources said previously. Link's latest annual earnings before interest, tax, depreciation and amortization are estimated to be between $120 million-130 million, the sources said.

PEP had looked at options including an IPO, the sources said, but is selling the stake instead due to weak markets that have forced a near two-year drought of big IPOs in Australia and cancellation of offerings globally.

On Thursday, London luxury jeweler Graff Diamonds ditched its $1 billion initial public offering adding to a chill that Facebook's (FB.O) botched IPO has cast over an already moribund global market for new listings from Hong Kong to New York. [ID:nL4E8GU83J] The global racing giant Formula One may also delaying its Singapore IPO, according to reports on Friday.

UBS (UBSN.VX)is advising ASX on the deal one of the sources told Reuters while a media report said KKR has hired Morgan Stanley (MS.N) and Macquarie (MQG.AX).

This article is copyrighted by Reuters

© 2023 VCPOST, All rights reserved. Do not reproduce without permission.

Join the Conversation

Real Time Analytics