Qantas Airways Limited (ASX: QAN) is one of the most famous ASX shares on the S&P/ASX 200 Index (ASX: XJO). It’s not one of the largest. But the Flying Kangaroo certainly occupies a special place in the hearts and minds of many investors, thanks in large part to the company’s long history and famous brand name.

But in recent years, Qantas has been known for different reasons. In 2020, it became one of the ASX shares hit hardest by the outbreak of the coronavirus pandemic. Indeed, between 21 February and 20 March that year, the Qantas share price fell more than 63%, which was a drop close to double that of the broader market.

But since then, Qantas also become known as a COVID recovery play. In the month following 20 March 2020, Qantas shares rose more than 50%. Even today, two years on from the company’s 2020 lows, the Qantas share price remains an impressive 120% or so above those nadirs.

So now this tumultuous time is past Qantas, and global travel is getting back on its feet, many investors might be wondering if things have gotten back to normal for Qantas. After all, this company used to be known as a decent ASX dividend share. Between 2016 and 2019, Qantas grew its annual dividend from 7 cents per share to 25 cents per share.

So are Qantas shares back to providing a yield for income investors yet?

Qantas shares: Dividend not on the radar yet

Well, unfortunately, the answer is a resounding no. Qantas has not paid a dividend since the latter half of 2019. This streak was recently continued in February. Qantas dropped its half-year earnings report last month, which made no mention of a dividend coming investors’ way.

And looking at the company’s earnings, it’s obvious why. For a company to pay out a dividend, it usually has to be healthily profitable. And Qantas is simply not right now. The company’s earnings revealed an underlying loss before tax of $1.28 billion for the six months to 31 December 2021.

A loss of that magnitude pretty much rules out a dividend in the immediate future for Qantas shareholders.

The company could well return to paying dividends down the road. But until Qantas’ books are back in the black, that looks unlikely. So it appears as though income investors will have to wait a little longer to see their Qantas dividends return.

At the time of writing, the Qantas share price is up 0.97% today at $5.19. This ASX travel share has a market capitalisation of $9.7 billion.

The post Is Qantas an ASX dividend share? appeared first on The Motley Fool Australia.

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• What was the highest ever Qantas share price?
• Own Qantas shares? Here’s how the airline is planning to profit from NFTs
• Is the Qantas (ASX:QAN) share price about to soar 40% higher?
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Motley Fool contributor Sebastian Bowen has no position 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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ASX tech shares have been taking a battering this year. Luckily, there’s nearly always a buy to find if investors know where to look.

And this ASX tech share still has plenty of potential, according to our in-house analyst Chris Copley.

Copley sat down with our chief investment officer Scott Phillips earlier this month to discuss his bullish view of software provider Xref Ltd (ASX: XF1).

Their chat was part of The Motley Fool’s Stock of the Week series. This week’s stock pick, as well as past picks, can be found on our YouTube channel. Audio-lovers can also find this week’s stock pick in podcast form here.

At the time of writing, the Xref share price is 64 cents.

Though, it’s important for readers to keep in mind that when Copley talked over the company’s investment thesis, its shares were trading at around 53 cents.

Let’s break down why the analyst is optimistic about the tech company’s investment potential.

But first, what is Xref?

It’s a relatively unheard of ASX small-cap, but Xref is doing big things in the human resources (HR) sphere.

The technology company provides a cloud-based automated reference checking software for the employee hiring process.

It also has an ID verification leg – acquired in 2019 – and can provide employers with analytics, additional tools, and minimise fraud risks to help companies on their hiring journeys.

For instance, the company will flag with an employer if an applicant’s references were sent from the same device as their application.

Xref has a market capitalisation of around $117 million and has been listed on the ASX since 2007, according to the exchange.

Why does this Motley Fool analyst see in the ASX tech share?

Chris Copley is bullish on ASX tech share Xref for plenty of reasons.

Firstly, he’s been blown away by Xref’s recent growth.

“In terms of execution, it has by far and away exceeded my expectations over the last couple of years,” said Copley.

“In fact, Xref has been one of the very few companies which has managed to buck the growth company trend.”

The Xref share price has gained an impressive 154% over the last 12 months.

For comparison, the S&P/ASX All Technology Index (ASX: XTX) has slipped 5% over the same time frame.

“The company generated sales growth of around 95% in the first half of the year,” continued Copley.

“It also generated positive operating cash flow of around $2.3 million, so its top line growth has been very strong and this has been supported by the great resignation around Australia and around the globe over the last year and a half.

“But equally, even more impressive perhaps, is the fact that this growth, even if you look back over the last few years, has come without significant increases in its operating expenses.”

The analyst also likes the niche space Xref is operating within. Though, it’s still large enough.

The company’s technology is available around the globe and in multiple languages. And Copley is impressed by the speed with which Xref has expanded internationally.

He noted that, in 2016, just 1% of its revenue came from overseas. Fast forwarding to Xref’s most recent financial year, 7% of its sales came from Europe, 11% from North America, and 11% from New Zealand.

It also boasts a growing user base of “reputable” companies, says Copley, with plans to add more features to its offerings.

Additionally, since its 2019 acquisition of Rapid ID, the business’ customer base has grown by more than 2,000%.

Copley also likes that Xref is still led by its founder and CEO, who is also its largest shareholder.

Finally, the analyst noted that, at the time of recording, the company was trading at a valuation of slightly more than 30 times its free cash flow.  That valuation “isn’t particularly demanding,” said Copley.

 What are some of the risks of investing in Xref?

While Copley is bullish on the ASX tech share, it’s still important to outline some risks of investing in the company.

Firstly, Xref does have competitors. Copley noted it’s worth keeping an eye on how those industry peers might slow or block Xref’s expansion internationally.

Additionally, there’s a risk that the company’s clients could build their own automated reference checking solutions. That could be a “significant headwind on growth” for the ASX tech share, noted Copley.

There’s also a “significant portion” of the company’s target market that prefer to do reference checks ‘the old-fashioned way’. That could limit the company’s potential market, said the analyst.

Finally, because the company effectively charges users per use, its earnings are more susceptible to market cycles.

Recent record staff turnover has been helping it to grow lately.

But, as Copley noted, the job market will likely stabilise at some point. A more stable job market will probably see the company’s growth scaling back to more ‘normal’ levels.

So, is the ASX tech share a buy?

All in all, Copley believes Xref shares are worth looking into.

“Right now, I think that Xref offers an attractive ‘risk/reward’ proposition for investors,” he concluded.

The opinions expressed in this article were as at 16 March 2022 and may change over time.

The post Why Motley Fool analyst Chris Copley is so bullish on this ASX tech share appeared first on The Motley Fool Australia.

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• What’s impacting the Cimic (ASX:CIM) share price this week?
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• What’s with the Rio Tinto (ASX: RIO) share price today?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. Motley Fool analyst Christopher Copley owns Xref Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Xref Limited. The Motley Fool Australia has recommended Xref Limited. 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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The Telstra Corporation Ltd (ASX: TLS) share price is making early gains after management outlined details of its restructure to unlock “additional value to shareholders”.

Under the plan, shareholders in the country’s largest telco will swap their shares in Telstra Corporation for Telstra Group Limited.

The Telstra share price is currently up 0.9% to $3.905 in morning trade. For comparison, the S&P/ASX 200 Index (ASX: XJO) is up 0.76%.

Telstra’s four new entities

The Telstra share price is gaining after the telco revealed the restructure would result in a new holding company — Telstra Group Limited. This will in turn control four divisions — InfraCo Fixed, Amplitel, Telstra Limited, and Telstra International.

InfraCo owns the fixed infrastructure like poles and wires. Amplitel owns the mobile phone towers, in which Telstra sold a 49% stake for $2.8 billion. The sale was part of its T22 strategy announced in 2018 to realise value for investors.

Telstra Limited will be the customer-facing service arm of the group, while Telstra International owns assets like subsea cables.

Management has taken steps to establish InfraCo as a standalone business. This includes intercompany agreements developed between InfraCo and Telstra Limited to “support strong and sustainable earnings for both entities”.

The move will also make it easier for Telstra Group to divest or spin off InfraCo at a later stage to crystallise further value for shareholders.

But there are a few more steps Telstra needs to make to complete the restructuring. This includes getting approvals from the Australia Competition and Consumer Commission as well as the courts.

Legal hurdles

“Telstra is using a Scheme of Arrangement to implement key parts of the restructure as the most practical and efficient way to create the new Telstra Group,” said the company.

“The restructure involves the transfer of assets and liabilities within entities of the Telstra Group, and the Scheme of Arrangement will enable those assets and liabilities to be transferred by order of the Court.”

Once the new entity is in place, Telstra wants to put its international business under a separate subsidiary. This is to keep that business together as one entity within the Telstra Group.

When will the new Telstra share price start trading?

Telstra will also need to renegotiate its contracts with NBN Co (the owner of the national broadband network). This is where the ACCC approval comes in to ensure the new agreement is authorised under competition law.

Assuming everything goes to plan, Telstra Group shares will start trading on the ASX by the end of October 2022.

The Telstra share price has jumped 15% over the past year. In contrast, the ASX 200 is up less than 10%.

The post Ringing the changes: Telstra share price jumps amid latest restructuring news appeared first on The Motley Fool Australia.

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Motley Fool contributor Brendon Lau owns Telstra Corporation Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Telstra Corporation Limited. 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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Shares in Cimic Group Ltd (ASX: CIM) have opened the session at $22.01 apiece on Tuesday after starting the week in the red.

Whilst there’s been nothing out of Cimic’s camp today, it did update the market via a company announcement regarding its target’s statement in response to a takeover offer on Monday.

What’s going on with Cimic shares?

The company announced that it has released its target statement in response to the off-market takeover offer by German construction group, Hochtief Australia Holdings Ltd.

Hochtief AG (FRA: HOT), the holding company’s chief, made the offer in February at an offer price of $22 cash per share.

It already owns a 78.58% stake in the company. If successful, this transaction would mean Hotchief will acquire all the remaining shares of Cimic it doesn’t already own.

Cimic says that after it received the offer, it appointed an Independent Board Committee (IBC), comprising independent directors Russell Chenu and Kate Spargo, “with responsibility for considering, evaluating and responding to the offer.”

Afterwards, the IRC appointed an independent expert to assess the offer and determine if it was in the best interests of stakeholders.

“The Independent Expert has concluded that the Offer is fair and reasonable to Cimic Shareholders other than Hochtief Australia,” the release notes.

“The Independent Expert has assessed the estimated market value of Cimic Shares on a controlling and 100% basis to be in the range of $19.26 and $25.05 per Cimic share,” it added.

Cimic also stated the target’s statement has or will be sent to Hochtief and lodged with the Australian Securities and Investments Commission (ASIC) on Monday.

Cimic share price snapshot

In the past 12 months, the Cimic share price has crept up by 23% and is now soaring 30% higher this year to date.

During the past month, shares have slipped into the red and trade less than 1% down in the past week.

The post What’s impacting the Cimic (ASX:CIM) share price this week? appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position 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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There is an ever-growing list of ASX exchange-traded funds (ETFs) for investors to consider.

Following Russia’s invasion of neighbouring Ukraine, the Betashares Global Cybersecurity ETF (ASX: HACK) has certainly earned its place on that list.

If you’re not familiar, HACK provides ASX investors exposure to 41 leading global cyber security shares. Top holdings for the ASX ETF include Crowdstrike Holdings, Cloudflare Inc and Palo Alto Networks Inc.

There currently aren’t any Aussie listed cyber security firms among the ASX ETF’s holdings. That’s because the market caps of the Aussie shares are still too small to be included.

Why is HACK in the spotlight this week?

Russia is said to have one of the most advanced cyber armies in the world. To date, it’s restrained its cyber attacks largely to Ukrainian territory and assets.

But businesses and governments fear that may not remain the case.

Of particular concern is how businesses might recoup their losses, which can run into the many millions of dollars, from any potential cyber attacks.

Currently, businesses can take out cyber insurance to help cover the costs of a hacking attack.

But major state sponsored cyber attacks may be interpreted as an act of war. Meaning insurance companies may not cover the costs.

Indeed, as The Australian reports, insurance broker Marsh has sounded the alarm on the potential for Russia’s aggression against Ukraine to result in cyber attacks in other nations.

Should that happen, insurance rates would likely increase and some coverage may be exempted.

Kelly Butler, head of cyber at Marsh said, “We haven’t seen any claims hit the market as a result of the war. It will depend on what happens. If there are large losses, I would imagine premiums would increase.”

The Insurance Council of Australia (ICA) has also raised its concerns on the existing policies for cyber insurance.

In a recent report the ICA noted:

A major cyber event or a smaller series of connected successive attacks could render cyber insurance financially unviable. The impact of an accumulation event is of underlying concern to many insurers.

It’s urging the Australian government to come up with a national cybersecurity standard for cyber insurance issues and their clients in order to “evaluate their cyber maturity according to uniform and constantly evolving standards”.

That sounds like a fair recommendation.

In the meantime, and with HACK in mind, the best defence is, well, a good defence.

How has this ASX ETF been performing?

We’ll pick 24 February for our ‘as of performance date’ for HACK. That’s the day Russian troops officially invaded Ukraine.

Since 24 February the ASX ETF’s share price is up 13.9%.

By comparison, the All Ordinaries Index (ASX: XAO) has gained 6% in that same period.

The post Why this leading ASX ETF is in the spotlight this week appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended BETA CYBER ETF UNITS. The Motley Fool Australia owns and has recommended BETA CYBER ETF UNITS. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Today’s bullish move in various cryptocurrencies has picked up steam nearly across the board. For top meme token Shiba Inu (CRYPTO: SHIB), the fact this momentum hasn’t slowed has led to some rather incredible price action today.

After The Motley Fool reported on Shiba Inu’s impressive 14% move over the past 24 hours as of around noon ET today, the token has picked up steam. As of 2:45 p.m. ET, Shiba Inu had surged 18% over the past 24 hours, blowing away most other tokens. Currently, this represents the largest move of all top-40 tokens by market capitalization.

As reported earlier, much of the rise seen today in Shiba Inu appears to be related to skyrocketing short liquidations. However, news this afternoon that Canadian exchange Netcoins has listed Shiba Inu has provided yet another catalyst for investors to jump on today.

So what

Overall, Shiba Inu appears to remain a rather speculative trading vehicle. There’s a strong retail base of holders willing to wait out near-term volatility. However, the day-to-day price action with this token simply precludes many investors from holding Shiba Inu for any extended period of time.

That said, retail demand for Shiba Inu continues to be one of the metrics investors watch with respect to where this token could be headed. The addition of yet another exchange to buy and sell Shiba Inu raises the prospect that retail buying activity could spur additional surges in the days to come. Accordingly, speculators are doing what they do best, and diving into SHIB in a big way today.

Now what

The big question many investors have is just how long this rally can be sustained. Meme mania appears to be picking up steam once again, seen in the stock market as well, with the likes of GameStop and other meme stocks taking off. GameStop’s 10-day winning streak has been impressive and appears to be emboldening the ShibArmy today.

For now, the outlook among those adding Shiba Inu is bright. This will certainly be a fun token to watch in the days and weeks to come.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Shiba Inu’s ride higher accelerates as the token surges 18% appeared first on The Motley Fool Australia.

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Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Rio Tinto Ltd (ASX: RIO) share price is in the red today amid lithium acquisition news.

The mining company’s shares are currently trading at $116.77, a 1.43% fall. The S&P/ASX 200 Resources Index (ASX: XJR) is also down 0.95% at the time of writing while the BHP Group Ltd (ASX: BHP) share price is down 0.77%.

Let’s take a look at what Rio Tinto announced today.

Lithium acquisition news

Rio has cleared the final hurdle to acquire the Rincon Mining lithium project in Argentina for $825 million.

The company has received approval from the Australian Foreign Investment Review Board (FIRB) for the takeover.

The “underdeveloped” lithium brine resource is located in the so-called lithium triangle in the Salta Province of Argentina.

Rio sees the project as one that can help the company decarbonise, given the project’s low carbon footprint.

Rio informed the market of plans to acquire the project in December 2021.

The company highlights lithium demand is predicted to surge between 25 to 35% per year over the next decade.

Yesterday, UBS upgraded Rio’s shares from a “sell” to neutral on the back of increasing iron ore price forecasts.

The gold price fell 1.73% overnight, while silver dropped 2.35%. Rio mines gold, silver, diamonds, copper, aluminum, iron ore, and uranium.

Management comment

Commenting on the news, Rio Tinto chief executive Jakob Stausholm said:

Rincon strengthens our battery materials business and positions Rio Tinto to meet the double-digit growth in demand for lithium over the next decade, at a time when supply is constrained.

We will be working with local communities, the Province of Salta and the Government of Argentina as we develop this project to the highest ESG standards.

Rio Tinto share price snapshot

The Rio Tinto share price is up 17% this year to date, gaining about 4% in the past 12 months.

Rio Tinto shares have risen 6% over the past week alone.

In contrast, the S&P/ASX 200 Index (ASX: XJO) is up nearly 10% in the past 12 months.

Rio has a market capitalisation of more than $43 billion based on its current share price.

The post What’s with the Rio Tinto (ASX: RIO) share price today? appeared first on The Motley Fool Australia.

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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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ASX shares have staged a snap-back rally this month as investors pile back into equities and ETFs. The All Ordinaries Index (ASX: XAO) has jumped 156 basis points over the last week and is continuing its march today.

It’s up another 0.62%, or 48 points, in early trading on Tuesday at 7,737 points.

Leading the charge are financial, tech, and commodity-based players fronting the benchmark indices and stringing up the broader market.

As the world winds back from COVID-19 and starts to reopen, it’s no wonder money managers are positioning themselves to take advantage of the prevailing trends.

Pullbacks: add to ‘high-quality businesses’

The All Ords has started to climb back towards its 3-month highs and has shrugged off fears of a global recession in March.

Within the Australian market, two players have caught the eye of Prime Value Emerging Opportunities Fund portfolio manager Richard Ivers.

Ivers said that his fund had managed to capitalise on the recent pullback in equity markets and used the selloff to add more to key holdings.

“Recent volatility has enabled us to add to existing holdings of high-quality businesses we know well which became cheaper,” the portfolio manager told The Australian Financial Review.

Two of these names are insurance broker AUB Group Ltd (ASX: AUB) and fashion retailer City Chic Ltd (ASX: CCX), Ivers noted.

Why the bullish outlook?

AUB has spiked 19% in the past 12 months after a wobbly year, but momentum has slowed in 2022.

Since trading restarted in January, its shares have tumbled more than 12%, giving the portfolio manager an exciting entry point. They now trade at $22.77 apiece at the time of writing.

In its half-yearly results in February, the company reported underlying net profit after tax (NPAT) growth of 17% to $30 million while reported NPAT grew 28% year on year.

The board also declared a 17 cents per share dividend with shareholders to receive full franking credits as a taxable offset.

It also guided NPAT growth for FY22 between 19%-22.3%, calling for $72-$74 million at the bottom line.

Meanwhile, shares in City Chic have been punished in 2022, having erased more than 39% since January when trading resumed.

Investors weren’t satisfied with the company’s half-yearly results and no doubt wanted more from the company’s 6% reduction in net profit to $12.3 million.

As a result, shareholders aren’t privy to a dividend this earnings cycle from the fashion retailer. As The Motley Fool’s Brooke reported at the time, “due to COVID-19 uncertainty, investment in inventory, a decline in operating cash flows, and acquisition opportunities, the company hasn’t paid a dividend this half.”

“It didn’t pay a dividend for financial year 2021 either.”

Nonetheless, Ivers is constructive on the stock, as he is on all the holdings in the Emerging Opportunities Fund.

And the experienced market pundit doesn’t fear calamity, opting to view it as an opportunity to pounce instead.

“…the sell-off finally gave us the opportunity to buy at an attractive price – that’s the great thing about volatility. Many people hate it, we like it!”

The post Fundie is buying these 2 ASX All Ords shares at discount prices appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position 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 recommended Austbrokers Holdings Limited. 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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Strong interest from offshore investors may have contributed to S&P/ASX 200 Index (ASX: XJO) shares outperforming the S&P 500 (INDEXSP: .INX) recently.

Macquarie noted that demand for ASX shares from overseas investors has significantly increased since Russia’s invasion of Ukraine, reported The Australian.

While the war has delivered a blow to investor sentiment, the impact wasn’t as badly felt here. The ASX 200 Index is more than 200 basis points ahead of the S&P 500 since the start of the year.

Why ASX shares are beating the US

It’s rare for ASX’s benchmark index to beat its US counterparts. This time, it coincides with increased buying from international investors.

“Our Australian equities team has seen this interest first hand,” Macquarie’s Australian equity strategist, Matthew Brooks was quoted as saying by The Australian.

“For the first time in several years there is strong interest in Australian equities, mostly resources but also banks and real estate.

“Australia is a long way from the Russia-Ukraine war, but the event is having a bigger than expected impact on the share market.”

Exchange rate outlook favours ASX shares

The broker also increased its exposure to ASX shares, including resources, in its model portfolio recently. One reason is that Macquarie believes the Australian dollar could jump as high as US96 cents.

This prediction isn’t farfetched if commodity prices remain high while the US economy slows due to inflation.

The jump in the Aussie will give unhedged offshore investors a further gain from the exchange rate.

Commodity price upgrade provides second tailwind

Meanwhile, analysts have been upgrading their price forecasts for a wide range of commodities, from metals to energy.

This probably helped the BHP Group Ltd (ASX: BHP) share price rally to a seven-month high yesterday. Its peers like the Rio Tinto Limited (ASX: RIO) share price and the South32 Ltd (ASX: S32) share price have also performed strongly in the last several weeks.

“An important implication of the commodity tailwind for Australian growth is that our domestic cycle has suddenly improved relative to the US,” added Brooks.

Rising tensions put Australia in a good spot

But commodity prices and the currency aren’t the only tailwinds for ASX shares. Brooks believes Europe’s largest conflict since the Second World War has forced global investors to think about geopolitical risks.

“These risks are likely greater in authoritarian regimes, and the other large authoritarian country is China,” he said.

“For investors concerned about investing in China, Australia is an alternative for Asia exposure, as it offers resources exposure within the backdrop of Australia’s strong and stable democratic institutions and governance.”

The post Why international investors are flocking to ASX shares right now appeared first on The Motley Fool Australia.

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• 2 ASX shares to guide you through a turbulent 2022: expert
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Motley Fool contributor Brendon Lau owns BHP Billiton Limited, Macquarie Group Limited, Rio Tinto Ltd., and South32 Ltd. 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 recommended Macquarie Group Limited. 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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The Uniti Group Ltd (ASX: UWL) share price is rising again on Tuesday.

In morning trade, the growing telco’s shares are up 4% to $4.92.

Why is the Uniti share price rising today?

The Uniti share price is rising today after the bidding war for the telco between Morrison & Co and Macquarie Group Ltd (ASX: MQG) intensified.

According to an announcement this morning, the company has received a revised indicative proposal from a consortium comprising Morrison & Co and Brookfield Infrastructure Group to acquire Uniti for cash consideration of $5.00 per share via a scheme of arrangement. This brings its offer in line with what Macquarie tabled last week.

The release notes that other than the increase in proposal price and the inclusion of Brookfield as a 50/50 partner, the terms and conditions of the revised proposal are largely the same as the previous offer revealed on 14 March.

Uniti also revealed that the Morrison/Brookfield consortium has advised that it has made significant progress in relation to both its diligence program and engagement with lenders. Importantly, the consortium has not identified anything that would indicate that it would not be able to enter into a binding scheme implementation agreement with Uniti.

What about Macquarie’s offer?

At this stage, it looks to be advantage Morrison/Brookfield consortium. As part of the Morrison proposal, Uniti is unable to offer due diligence to any other suitors for four weeks even if they present a superior proposal.

Whereas Macquarie’s proposal demands the granting of due diligence within four weeks, which Uniti notes is “incompatible” with the Morrison/Brookfield proposal.

As a result, after careful consideration of both proposals, the Uniti board has determined it is in the best interests of shareholders to engage with the Morrison/Brookfield consortium on its revised proposal and thus won’t be engaging with Macquarie at this time.

Uniti will continue to update shareholders, in accordance with its continuous disclosure obligations, of further developments as they arise.

The post Uniti (ASX:UWL) share price up 4% as Morrison ups the ante appeared first on The Motley Fool Australia.

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• Why has the Macquarie (ASX:MQG) share price rallied 9% in a month?
• Could a bidding war be on the cards for Uniti (ASX:UWL) shares?
• Uniti (ASX:UWL) said to be ‘considering’ Macquarie cash bid of $5 per share

Motley Fool contributor James Mickleboro has no position 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 recommended Macquarie Group Limited and Uniti Group Limited. 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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