Shares of Just Group PLC (LSE:JUST) skyrocketed by 67.9% on Thursday after the company revealed it has agreed to be acquired by a Brookfield Wealth Solutions Ltd subsidiary in a deal valued at 220p per share.
The offer price implies a 75% premium over Just Group’s closing price on Wednesday and surpasses the company’s previous record high set in April 2016.
This transaction assigns Just Group a valuation equivalent to roughly 1.1 times its FY 2024 Unrestricted Tier 1 capital (net of the final dividend), aligning with the valuation multiple Athora recently paid for PIC.
As per the terms of the agreement, the acquisition is targeted to close in the first half of 2025. However, the purchasing entity retains the option to lower the offer if any dividends or capital returns are issued prior to completion.
The transaction is expected to be carried out via a court-approved scheme of arrangement. Nonetheless, Brookfield reserves the right to pursue the deal through a Takeover Offer route if necessary approvals are obtained.
Analysts at Jefferies believe the current proposal offers shareholders compelling value. “Thus, as the bid premium appears to offer very attractive upside, and has already received the support of management, we believe that investors should similarly support the deal,” they commented.
The fact that the management has already endorsed the agreement increases the likelihood of a seamless completion, although the deal remains subject to regulatory clearance.
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