Here are 6 of the top ASX corporate takeovers of 2023 that succeeded

Nick Sundich Nick Sundich, December 28, 2023

Despite a subdued environment for dealmaking, there were some notable ASX corporate takeovers during the year. We thought as 2023 comes to an end, it was fitting to recap some of the top deals of the past 12 months.

 

6 of the top ASX corporate takeovers of 2023

Newcrest

Newcrest was and is one of the top gold miners in the world. So was Newmont, but the latter company was not content with being just another big gold miner, it wanted to be the biggest in the world. And the A$26.6bn takeover of Newcrest has made it so. The company now has a combined 19 gold assets.

In good news for investors, Newmont didn’t just take the scrip and run. Instead, it took Newcrest’s listing on the ASX. Newmont shares are flat since its ASX listing, but it is too early to judge how it has gone from a share price perpsective given it has only been a couple of months since the listing. Nonetheless, the fact that the deal actually went ahead is enough to place it on this list.

 

Sigma Healthcare

Yes, this deal hasn’t been completed just yet, although we are putting it on the list because it seems all but certain the deal will go ahead. Sigma, one of three key wholesalers dispensing medicines to chemists, will be bought by Chemist Warehouse, a long rumoured IPO candidate and a significant industry giant. Mario Verrocchi, CEO of Chemist Warehouse, has said he wants to buid an Australian version of Boots (the successful British pharmacy chain).

This deal is not entirely without concerns, including that it could lead to a loss of independent pharmacies buying from Sigma’s wholesaler business. But if approved, any disadvantages will easily be outweighed by advantages of vertical integration, scale and negotiating power.

 

Link

Some shareholders wouldn’t call this $2.1bn deal a success. This deal too hasn’t yet closed, but seems a formality to happen. The reason why this deal may not be considered a success is because it is being done at a 67% discount to the price Link listed at back in 2015.

Although Link has a solid market position, it has been caught up in several messes, not all of which were of its own making. In particular, it got dragged into the messy collapse of the $7bn Woodford investment fund as well as multiple takeover offers that came to nothing. But now, it looks like the company is finally set to depart.

 

Allkem

Just a week before Christmas, investors in Allkem voted to accept a $10.6bn takeover offer from Livent. This deal will unfortunately see Allkem disappearing from the ASX, but it will create one of the world’s largest lithium companies with a substantial footprint all over the supply chain, in the exploration, mining and production of lithium, to delivering finished chemicals to battery-maker customers.

 

Invocare

They say the only certainties in life are death and taxes, and Invocare is Australia’s largest provider of death care services. Notwithstanding this, Invocare had a turbulant few years with heavy industry competition and less than ideal bottom lines triggered by losses from the funds invested in property, shares and cash from people who opt to pre-pay for funerals. It was taken over back in November by TPG Capital for $1.8bn, a takeover bid the board had little choice but to accept.

 

Healthia 

If a company not getting recognised by investors really is a good company, a takeover will happen. And this is just what happened. The company is a rollup company of allied healthcare practices. It was sold off because investors feared consumers would cut their spending on the services Healthia provides. Unlike the services provided by other healthcare stocks (such as pathology), services like physiotherapy and speech therapy typically are not fully covered by Medicare.

Pacific Equity Partners made a bid that was an 85% premium to the share price and the board unanimously backed the offer. Not a good outcome for the ASX considering the high-quality company it was, but a good outcome for shareholders whose investment finally got the recognition it deserved.

 

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