Perpetual (ASX:PPT) share price hits 4-month low following acquisition news

ASX shares investor looking incredulously at phone

The Perpetual Ltd (ASX: PPT) share price is slipping around 4% into the red during afternoon trade today with its shares now changing hands at $36.06 at the time of writing.

Shares in the financial services company are trading down today despite there being no market sensitive news out of its camp today.

However, Perpetual has announced that it had completed an acquisition earlier today which may be weighing on its share price.

Here’s what we know.

What did Perpetual announce?

Perpetual advised it had completed the acquisition of Laminar Capital Pty Ltd, a “specialist debt markets and advisory business”.

According to Perpetual, Laminar has $8 billion in funds under management/advice (FUMA) alongside a specialist fixed income digital platform with $21 billion in assets under administration, known as Treasury Direct.

Acquiring Laminar Capital will also provide the company with access to new capabilities that it otherwise wouldn’t have access to.

For example, Laminar’s ESG Risk score is a specialised function that Perpetual highlights as supporting the public and mutual bank sector.

In terms of the structural components of the deal, Perpetual Corporate Trust (PCT)’s data and analytics solutions business will become a standalone division of the Trust, known as Perpetual Digital.

The company explains Perpetual Digital is to be Perpetual Corporate Trust’s “innovation company”.

These moves will roll all of PCT’s digital assets into one and fold in Laminar’s Treasury Direct platform to “create a specialist business focussed on providing digital, treasury debt markets and advisory solutions to clients”.

Perpetual itself appears to be satisfied with the acquisition, forming the view that it is accretive to the company’s earnings potential in years to come.

Speaking on the announcement, Perpetual CEO Rob Adams said:

In Laminar we’ve identified a fast-growing debt markets and advisory business with a compelling digital capability. A capability that provides us with a unique opportunity to accelerate Perpetual Corporate Trust’s (PCT) position as a specialist fiduciary and digital solutions provider to the banking and financial services industry.

Perpetual Corporate Trust’s group executive Richard McCarthy was equally as pleased to have nabbed the debt markets specialist Laminar, particularly noting its depth of management experience. He added:

Over time, we have seen Laminar successfully establish itself in the mid-markets sector, developing and delivering debt markets and digital solutions to key client segments. Since its inception in 2009, the team at Laminar has developed a strong reputation as trusted adviser, with deep client relationships and expertise as a treasury and debt markets specialist, leveraging their combined experience built over 30 years in the industry.

Investors are selling the company’s shares today, pushing the Perpetual share price to 4-month lows during trading today.

Perpetual share price snapshot

The Perpetual share price has been all over the place this year to date and has consequently posted a return of just 3.6% since January 1.

Over the past month, it’s given away a further 13% and has slipped 8% into the red this past week.

Despite this, over the last 12 months, Perpetual shares have climbed 23%, just behind the S&P/ASX 200 Index (ASX: XJO)’s gain of about 25% during this time.

The post Perpetual (ASX:PPT) share price hits 4-month low following acquisition news appeared first on The Motley Fool Australia.

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The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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