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- PM Capital will soon merge its Global Opportunities Fund (PGF) and Asian Opportunities Fund (PAF)
- Specifically, PGF will acquire all PAF’s shares which it does not already own by way of a Scheme of Arrangement
- The Asian Fund’s shareholders will be offered PGF shares as consideration, with an implied offer value 23.8 per cent higher than PAF’s last closing price
- PM Capital argues the merger will benefit both PGF and PAF shareholders by reducing fixed costs relative to investment returns and increasing liquidity
- Following the merger news, shares in PGF are down 5.03 per cent at $1.51, while PAF shares are up 12.4 per cent at $1.09 at 1:40 pm AEST
PM Capital is planning to merge its self-titled Global Opportunities Fund (PGF) and Asian Opportunities Fund (PAF).
The financial stock made the announcement on Wednesday, revealing PGF will acquire all of PAF’s shares by way of a Scheme of Arrangement.
The Global Fund already had a 19.9 per cent stake in the Asian Fund and PAF shareholders will be offered PGF shares as consideration.
The exact number of PGF shares to be exchanged for PAF shares will based on PAF’s net tangible assets per share divided by PGF’s net tangible assets (NTA) per share.
PM Capital said the implied offer value based on most recently published NTAs represented a 23.8 per cent premium to PAF’s closing price.
Explaining the reasons for the merger, the investment business said it would reduce the fixed costs relative to investment returns and increase trading liquidity on the ASX.
Additionally, a PAF Board Committee has recommended the merger, concluding it’s in the best interest of shareholders with no superior offer present.
PM Capital expects a portfolio pre-tax net asset value of the merged entity to total $712 million with 8400 shareholders.
The merger is subject to an Independent Expert recommending the deal for PAF shareholders as well as those shareholders approval.
Shares in PAF have jumped up 12.4 per cent to $1.09 per share.
PGF shares were trading in the red following the announcement, down 5.03 per cent at $1.51 each at 1:40 pm AEST.
