Perpetual confirms breakup with KKR

Company News

by Glenn Dyer

Perpetual (ASX:PPT) has confirmed the breakup deal it has struck with the US private equity giant, KKR.

In a statement to the ASX on Wednesday morning, Perpetual said it had agreed to a deal with KKR & Co. for the sale of its wealth management and corporate trust units for A$2.175 billion (US$1.43 billion).

The Sydney-based company, which has more than A$200 billion in funds under management, has entered into a cash deal with KKR.

Perpetual CEO Rob Adams will retire following the deal’s completion, the company said.

Perpetual said its board unanimously recommended shareholders back the scheme in the absence of any superior proposal and noted that an independent expert had concluded that it was in their best interests.

The deal will make the company "a leaner, debt-free, global, multi-boutique asset management firm managing A$227 billion in assets under management," Perpetual said in the statement to the ASX.

The funds raised from the transaction, including the separation of its two units, will be used by Perpetual to pay down its debt, along with funding the separation and transaction costs.

Perpetual shares slid more than 6% by 11:30 am as investors sold after betting on a takeover offer for the entire company rather than just the breakup.

Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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