Magellan Financial Group Ltd (ASX:MFG) has agreed to merge with Barrenjoey Capital Partners in a transaction valuing Barrenjoey at $1.6 billion, with Magellan set to acquire the remaining stock it does not already own by issuing 106,838,520 new shares.
The deal implies total consideration of $903 million for the stake to be acquired at completion and a transaction multiple of 15 times price-to-earnings, based on Barrenjoey’s last 12-month adjusted net profit of $108 million on revenue of $522 million.
Magellan will fund an initial incremental 10% interest in Barrenjoey from a Barclays affiliate for $148.9 million via a non-underwritten institutional placement and share purchase plan at $8.45 per share.
Post-completion, existing Magellan shareholders are expected to hold 58.2% of the combined group, with Barrenjoey parties holding 31.7% and Barclays about 4.9%, subject to shareholder and regulatory approvals.
MFG Chairman Andrew Formica: said, “The merger with Barrenjoey marks a transformative step in MFG’s evolution, bringing together two highly complementary businesses to create an Australian financial services group with meaningful scale and breadth.”
Completion is targeted for the second quarter of calendar 2026.