Steadfast Agrees to $5.5 Billion KKR-Backed Buyout in Major Australian Deal
Synopsis
Australia’s Steadfast Group has agreed to an A$7.7 billion takeover by a consortium backed by KKR, with shareholders to receive A$6 a share, a nearly 52% premium, as Amwins takes its underwriting business and Dragoneer takes control of broking.
Key Highlights
- Steadfast Group has agreed to an A$7.7 billion ($5.52 billion) buyout by a KKR-backed consortium.
- Amwins Group will acquire Steadfast’s underwriting agency business.
- Dragoneer Investment Group will take over its broking operations.
- Shareholders will receive A$6 per share, nearly 52% above the June 9 closing price.
- Steadfast’s board has unanimously backed the transaction.
- The deal is expected to close in December, subject to regulatory approvals.
Steadfast Agrees to A$7.7 Billion Deal
Australian insurance broker Steadfast Group has agreed to an A$7.7 billion buyout by a consortium backed by US investment firm KKR. Under the agreement, Amwins Group will acquire Steadfast’s underwriting agency business, while Dragoneer Investment Group will take control of its broking operations.
Shareholders to Receive A$6 Per Share
Steadfast shareholders will receive A$6 for every share they own. The offer represents a premium of nearly 52% to the company’s closing share price on June 9, the last trading day before the consortium announced its earlier proposal. Steadfast shares have gained more than 40% since June 9.
Board Recommends the Deal
Steadfast’s board has unanimously recommended that shareholders vote in favour of the transaction, provided no superior proposal emerges and an independent expert determines that the deal is in shareholders’ best interests. The company expects the transaction to be completed in December.
Deal Follows a Difficult Period
The buyout comes months after Steadfast chief Robert Kelly was temporarily stood down while an external investigation examined a workplace complaint. Steadfast shares fell to their lowest level in almost three years after the issue was announced in October.
More Australian Companies Attract Overseas Buyers
The Steadfast transaction is part of a broader increase in overseas investment and private equity interest in Australian listed companies. Other recent deals include Swedish investment firm EQT AB’s bid for asset manager Perpetual and CC Capital Partners’ takeover of financial services company Insignia Financial.
Emanuel Ajay Datt, managing director at Datt Capital, said the Steadfast deal highlights the difference between valuations in Australia’s public markets and those available in global private markets.
Source: Reuters
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