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The Evolution Mining Ltd (ASX: EVN) share price has come under pressure on Thursday morning after a pullback in the gold price offset the release of a positive announcement.

At the time of writing, the gold miner’s shares are down almost 4% to $4.92.

What did Evolution announce?

This morning Evolution announced the acquisition of a 100% interest in the Crush Creek project which is located 30km southeast of its Mt Carlton Operation in Queensland.

This follows its entry into an earn-in agreement with Basin Gold in September 2019. That agreement meant Evolution could earn a 70% interest in the project by funding $7 million of exploration expenditure.

With that now achieved, management has exercised its option to acquire the remaining 30% of the project from Basin Gold for a cash payment of $4.5 million.

Basin Gold will retain a 10% net profit interest on any gold production in excess of 100,000 ounces.

Why Crush Creek?

According to the release, Crush Creek hosts low sulphidation epithermal gold mineralisation which Evolution believes has significant potential to provide mine life extensions at Mt Carlton.

Evolution’s Vice President Discovery and Business Development, Glen Masterman, commented: “Drilling at Crush Creek has returned promising results and reinforces our belief that mineralisation we are delineating has the potential to extend mine life at Mt Carlton.”

Drilling under Evolution management of the project has focused on understanding and expanding the mineralisation at the BV7 site along with testing the Delta area for a new discovery. Management revealed that encouraging results have been received from BV7 as well as from the Delta, The Kink, and Gamma prospects.

Drilling is continuing at these prospects during the December quarter focusing on the high-grade plunge to the north of BV7. In addition, follow up drilling continues at The Kink and Gamma prospects. More drilling updates are expected be released in the coming quarters.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday
• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor James Mickleboro 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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An Australian share trading platform is offering free shares in Airbnb Inc (NASDAQ: ABNB), which is listing Thursday night AEDT.

Online broker Stake has given out a referral code — ‘Airbnb’ — that allows new users of the platform to receive a free Airbnb stock to the value of US$75.

The company’s initial public offering (IPO) price is in the range of US$56 to US$60.

This is in addition to Stake’s usual sign-up offer of a free share of Nike Inc (NYSE: NKE), GoPro Inc (NASDAQ: GPRO) or Dropbox Inc (NASDAQ: DBX).

The Motley Fool has contacted Stake for comment.

The catch is that users will have to submit proof they have used Airbnb as a host or a guest in order to receive the free stock.

Airbnb’s public listing has been highly anticipated for years. It reportedly tried to list earlier this year but the COVID-19 pandemic killed off that attempt.

Now, after sacking a quarter of its employees during the height of the virus downturn, it’s back with a vengeance.

So much so that it hiked up its IPO price from a range of US$44 to US$50 due to investor demand.

“Even at a higher price, Airbnb will see a lot of demand from IPO investors, and shareholders are hopeful that the stock will jump out of the gate as well,” wrote The Motley Fool US’s Dan Caplinger.

“That’s not surprising for a company as well known as Airbnb, and it’ll be interesting to see whether $56 to $60 per share turns out to be a huge bargain for IPO stock buyers.”

Why is Airbnb called Airbnb?

Airbnb started as an online listing in 2007 to rent out the co-founders’ air mattress in their San Francisco flat.

“I learn there’s a design conference coming to town, and all the hotels are sold out. And I’ve always believed that turning fear into fun is the gift of creativity,” Airbnb co-founder and chief product officer Joe Gebbia recalled in a 2016 TED talk.

Three guests booked to stay on their timber floor.

“They loved it, and so did we. I swear, the ham and Swiss cheese omelets we made tasted totally different because we made them for our guests,” Gebbia said.

“We took them on adventures around the city, and when we said goodbye to the last guest, the door latch clicked, Brian and I just stared at each other. Did we just discover it was possible to make friends while also making rent?”

The answer was an overwhelming yes, and now their company is about to list with a market capitalisation of more than US$42 billion.

More reading

• Rio Tinto (ASX:RIO) share price flat on lithium project update
• Why the McPherson’s (ASX:MCP) share price is sinking lower again
• Saracen (ASX:SAR) and Northern Star (ASX:NST) shares on watch after merger update
• Apple stock could surge 61% to $200, according to this analyst
• 3 ASX tech shares that have delivered strong returns in 2020

Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Nike. The Motley Fool Australia has recommended Nike. 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 Rio Tinto Limited (ASX: RIO) share price is trading flat on Thursday morning despite a couple of positive news items.

At the time of writing, the mining giant’s shares are fetching $115.44.

What’s new for Rio Tinto?

The first bit of positive news this morning is that the spot iron ore price has continued its ascent.

According to CommSec, overnight the spot iron ore price climbed a further 0.5% to hit US$150.75 a tonne.

This means Rio Tinto’s iron ore operations are currently generating significant free cash flow, which bodes well for dividends.

What else is new?

Also of note for the mining giant’s shareholders is the release of an announcement relating to its Jadar operation in western Serbia.

That announcement reveals that Rio Tinto has declared its maiden ore reserve at the 100% owned lithium-borates project.

According to the release, the mineral resource comprises 55.2 Mt of indicated resource at 1.68% lithium oxide (Li2O) and 17.9% Boron trioxide (B2O3) with an additional 84.1 Mt of inferred resource at 1.84% Li2O and 12.6% B2O3.

This follows pre-feasibility studies which have shown that the Jadar project has the potential to produce both battery grade lithium carbonate and boric acid.

Management notes that the deposit is located on the doorstep of the European Union, one of the fastest growing electric vehicle (EV) markets in the world, and has the potential to provide lithium products into the EV value chain for decades.

It also points out that boric acid is a key raw material for advanced glass and fertiliser products and would be integrated with and complementary to Rio Tinto’s established position in this market.

In addition, the scale and high grade nature of the Jadar mineralisation provides the potential for a long life operation. One of which will be in the first quartile of the industry cost curve for both products.

What’s next?

The company revealed that the project moved into feasibility study at the end of July 2020. This was with an investment of almost $200 million on a scope that includes detailed engineering, land acquisition, workforce, and supply preparation for construction, permitting, and the early infrastructure development.

The feasibility study is expected to be complete at the end of 2021 and, if approved, construction could take up to four years.

More reading

• Citigroup downgrades these ASX mining stocks after a big rally
• ASX mining shares boosted today after broker upgrades
• Iron ore exports unlikely to slow down amid Australia–China trade tension: experts
• Why ASX iron ore stocks are set to rally today
• Are ASX stocks about to get an earnings upgrade boost in the new year?

Motley Fool contributor James Mickleboro 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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The McPherson’s Ltd (ASX: MCP) share price is dropping lower again on Thursday.

At the time of writing, the health, wellness, and beauty products company’s shares are down 6.5% to $1.17.

This means the McPherson’s share price is now down over 65% from its 52-week high of $3.40.

What did McPherson’s announce?

This morning the company announced that its Chief Executive Officer and Managing Director, Laurie McAllister, has resigned with immediate effect.

This follows a dreadful year for McPherson’s which has seen the company’s performance and share price deteriorate materially.

What happened this year?

During the first quarter of FY 2021, the company recorded a decent 4% lift in sales to $49.7 million.

However, it appears as though it tried to take advantage of the incredible demand for hand sanitiser at the height of the pandemic and this ultimately backfired.

While McPherson’s reported an 84% lift in underlying profit before tax to $2.9 million, this excludes a hefty $5.7 million non-recurring full provision for the write down of its hand sanitiser inventory.

Management advised that delays in the supply of hand sanitiser products led to a customer cancelling the majority of its orders. This left it with a significant quantity of product.

Since then, the strong demand has dissipated and the supply base for such products has become much more competitive. As a result, McPherson’s has been left holding excess quantities of hand sanitiser inventory.

Unfortunately, it went from bad to worse from there. At the start of December, the company revealed that its Chinese Singles’ Day sales fell well short of target.

Once again, this left its China joint venture partner, Access Brands Management (ABM), with higher than forecast inventory levels at the end of November.

As a result of this, the company was forced to withdraw its guidance.

What’s next?

McPherson’s has revealed that Non-Executive Director, Grant Peck, will replace Mr McAllister on an interim basis, effective today. It feels this will provide continuity and aid the transition to a new permanent CEO and Managing Director.

This continuity will be very important given that it only completed the acquisition of the Global Therapeutics business from Blackmores Limited (ASX: BKL) on 1 December.

The board advised that it will now initiate the necessary steps to identify and appoint a permanent CEO and Managing Director and will make a further announcement in due course.

More reading

• Why Adore Beauty, Bank of Queensland, Bega Cheese, & McPherson’s are dropping lower
• Why is the McPherson’s (ASX:MCP) share price dropping 35% today?
• Why these All Ords shares have been smashed this month

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores 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 Northern Star Resources Ltd (ASX: NST) and Saracen Mineral Holdings Limited (ASX: SAR) share prices will be on watch today after the companies released an update from their first court hearing related to the merger between the two companies.

What did they announce?

In a joint statement this morning, the two companies reported that the Supreme Court of Western Australia has ordered Saracen to convene a meeting of its shareholders to consider and vote on the merger scheme.

The court also ordered Saracen to approve the dispatch of an explanatory statement providing information about the scheme, and notice of the scheme meeting.

The joint statement confirms that the merger scheme continues to be unanimously recommended by both companies’ boards, subject to no other superior proposals, and that the boards believe the merger is in the best interests of shareholders.

The meeting for Saracen shareholders to vote on the proposed merger will be held 15 January 2021.

Why are the two gold miners merging?

The merger is worth $16 billion, and will see Northern Star acquire 100% of Saracen.

When it was announced back in October, Northern Star Executive Chair Bill Beament stated his belief that the merger will create considerable value for both sets of shareholders. He explained:

This is significant value-creating M&A. Northern Star has only ever pursued growth when it will create value for shareholders, and this merger-of-equals will create an abundance of value for both Northern Star and Saracen shareholders.

This sentiment was echoed by Saracen Managing Director Raleigh Finlayson, who told shareholders the company alone cannot create the sort of value that will be delivered by the merger. He said:

The benefits which will flow to Saracen shareholders from this merger are significant. The pre-tax synergies alone are expected to be worth in the order of $1.5 billion to $2 billion over the next 10 years.

Saracen shareholders will own 36% of the combined group and therefore share in the significant benefits of these synergies.

In a bid to sweeten the deal, Saracen will also pay its shareholders a 3.8 cent dividend prior to the merger, worth about $42 million in total.

How have the Saracen and Northern Star share prices been performing?

Since the merger was first announced on 6 October, both companies’ share prices have fallen in value. The Saracen share price has lost 7%, while the Northern Star share price fell 6%.

To put things in perspective, Saracen has a market capitalisation of $5.4 billion, while Northern Star commands $9.6 billion.

More reading

• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday
• 5 things to watch on the ASX 200 on Monday
• ASX 200 up 0.3%: Premier Investments update, big four banks rise, gold miners tumble

Motley Fool contributor Eddy Sunarto 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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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.

Shares of Apple Inc (NASDAQ: AAPL) have already climbed more than 70% so far this year, but will surge to new all-time highs in 2021.

That’s according to Wedbush analyst Daniel Ives. On Tuesday, Ives raised his price target on Apple stock from $150 to $160 — but outlined a bull case for it to climb as high as $200. His new base target represents potential gains for investors of roughly 7% over the stock’s closing price on Tuesday of about $124. It’s the bull case, however, that should have investors excited.

Ives cited several potential catalysts for Apple, most notably continuing strong demand for the iPhone 12 heading into the strategically-important holiday season. Ives noted a “clear uptick” and brisk sales in both the United States and China, the company’s largest markets.

“Demand remains very healthy with strong pent up demand for upgrades heading into holiday season for this latest iPhone 12 5G,” Ives wrote in a note to clients. He went on to characterize this as the “strongest product cycle for Cook & Co. thus far since iPhone 6 in 2014.”

Will Apple’s stock hit $200?

If this is the long-awaited supercycle that many Apple investors have been anticipating, it could be a record-setting year for the iPhone maker. The company previously revealed that it has an installed base of more than 1.4 billion active devices, with the iPhone making up an estimated 950 million of those.

If roughly one-third of current iPhone users upgrade to the latest version, that would result in as many as 350 million iPhones sold over the coming year. To give that number some context, Apple sold roughly 185 million iPhones last year. Given the recent advent of 5G and the number of devices in the upgrade window, it’s conceivable that Apple could sell twice as many iPhones — but not likely — making the $200 stock price a bit of a stretch.

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

More reading

• These 2 FAANG leaders will drive the Nasdaq in 2021
• 2 reasons Amazon will keep taking ad sales from Google
• Why is the Atomos (ASX:AMS) share price up 6% this morning?
• How the biggest companies are the worst investments
• 10 most searched shares in Australia

Danny Vena owns shares of Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Apple. The Motley Fool Australia has recommended Apple. 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.

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With 2020 now (thankfully) drawing to a close, it’s worthwhile looking back on some of the ASX shares that have outperformed this year. There are many ASX companies that have demonstrated their resilience and agility by delivering strong revenue growth despite the challenging market conditions created by the COVID-19 pandemic.

Furthermore, one could argue the way in which these companies have responded to the crisis could help ensure they have even greater success in the future.

Yesterday, I wrote about how corporate bookmaker Pointsbet Holdings Ltd (ASX: PBH) continued with its aggressive expansion strategy into the United States market throughout 2020 – despite the threat COVID-19 restrictions posed to its business model. And now, with the prospect of a vaccine buoying markets globally, Pointsbet is seeing a sharp rise in its share price.

Here are three other ASX tech companies that have been proactive in their responses to the various challenges posed this year – and may even grow into tomorrow’s market darlings because of it.  

Nitro Software Ltd (ASX: NTO)

Under-the-radar ASX tech share Nitro develops a suite of software solutions that allows individuals and businesses to streamline and digitise document workflows. The company’s software helps businesses create, edit, sign and store important documents entirely online, reducing the need for traditional forms of hardcopy file management.

As you can imagine, demand for this type of software solution soared during the pandemic, as many companies were faced with the new challenge of managing workflows for a widely dispersed workforce operating in lockdown. Nitro also made the extremely canny decision to give away its eSignature solution for free throughout 2020 to help support companies as they transitioned to working from home.

Results for the most recent quarter, ending 30 September 2020, were positive across just about all financial metrics. Cash receipts from customers increased by 17% quarter on quarter to $11.6 million, and subscription annualised recurring revenues (ARR) were all ahead of prospectus forecasts. The company also ended the quarter with a strong balance sheet, comprising $44.4 million in cash and no debt.

The Nitro Software share price has shot up almost 80% so far this year.

Megaport Ltd (ASX: MP1)

Megaport has been another surprising ASX tech share success story in 2020. This innovative company gives corporate clients the flexibility to manage their bandwidth usage. Customers can scale up their bandwidth when demands are high, and then reduce consumption during off-peak times. The platform also leverages cloud-based technology to expand company networks beyond the reaches of traditional infrastructure.

As was the case with Nitro, the unique working arrangements companies have been forced to adopt as a result of the COVID-19 pandemic have put Megaport’s services in high demand. The company’s annual revenues jumped 66% year on year to $58 million in FY20. And, after executing two successful capital raisings, Megaport ended the financial year with a cash position approaching $170 million.

The company has carried a lot of that momentum into FY21. Although quarter-on-quarter revenues only grew a modest 2% to $17.3 million, Megaport reported a record quarterly increase in customer numbers with most of that growth coming from the US.

Despite a recent pullback, the Megaport share price is still up close to 30% in 2020.

Whispir Ltd (ASX: WSP)

Small cap ASX tech share Whispir develops software that helps companies manage their communications workflows. It has created a centralised platform where its corporate customers can create high quality, customisable templates for email, web and social media communications, as well as drive insightful reporting.

Use of Whispir’s platform accelerated during lockdowns, as companies sought greater control over business-critical communications workflows. Whispir responded proactively to the crisis, developing a number of standardised COVID-19-related templates to assist its clients with meeting their communications obligations with staff and customers during the pandemic.

The company’s first quarter FY21 results continued to build on the positive foundations laid throughout FY20. Whispir announced that, during the three months ended 30 September 2020, it had added a record 35 new customers and brought in $10.5 million in cash receipts.

The Whispir share price has skyrocketed over 100% higher so far in 2020.

More reading

• 2 exciting small cap ASX shares to watch
• How to benefit from the cloud computing boom with ASX shares
• 2 exciting small cap ASX shares to watch in 2021
• ASX 200 Weekly Wrap: ASX 200 on track for a top month
• These were the worst performing ASX 200 shares last week

Rhys Brock owns shares of MEGAPORT FPO, Nitro Software Limited, Pointsbet Holdings Ltd, and Whispir Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MEGAPORT FPO and Whispir Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointsbet Holdings Ltd. The Motley Fool Australia has recommended MEGAPORT FPO, Nitro Software Limited, Pointsbet Holdings Ltd, and Whispir Ltd. 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 Fortescue Metals Group Limited (ASX: FMG) share price has been an incredible performer again this year.

Since the start of the year, the iron ore producer’s shares have recorded a gain of 102%.

This has been driven by its strong operational performance and of course a significant rise in the price of iron ore.

Is it too late to invest?

Given its strong gains this year, investors will no doubt be wondering if they have missed the boat with this one.

In light of this, I thought I would take a look to see what brokers are recommending investors do right now with Fortescue’s shares.

Buy rating.

Analysts at Macquarie currently have an outperform rating and $23.00 price target on the company’s shares.

Macquarie recently upgraded its earnings estimates to reflect the strong iron ore prices. It is also expecting material free cash flow yields to result in generous dividend payments in FY 2021.

The broker has forecast a fully franked $2.61 dividend, which represents a 12% yield.

Neutral rating.

Goldman Sachs has a neutral rating and $20.10 price target on Fortescue’s shares.

While the broker is forecasting a 12.7% dividend yield in FY 2021, it still feels its shares are fully valued at the current level.

It commented: “We believe FMG is fully valued based on a DCF basis discounting long run iron ore of c. US$80/t (real), but we see likely consensus EPS upgrades over the next few quarters and expectations for strong capital returns in February to continue to support share prices in the near term.”

Sell rating.

Analysts at Morgan Stanley have an underweight rating and $14.10 price target on the company’s shares.

Although they were pleased with its performance in the first quarter, they didn’t see enough value in its shares to change their rating.

Though, it is worth noting that the broker hasn’t yet responded to the most recent spike in iron ore prices. So, an update to its recommendation could be coming in the near future.

More reading

• Citigroup downgrades these ASX mining stocks after a big rally
• ASX mining shares boosted today after broker upgrades
• Why the Fortescue (ASX:FMG) share price hit a record high today
• Iron ore exports unlikely to slow down amid Australia–China trade tension: experts
• 2 excellent ASX dividend shares with 6%+ yields

Motley Fool contributor James Mickleboro 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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A new exchange-traded fund (EFT) is listing on the ASX next week, promising to avoid over-investing in the big technology giants.

BetaShares S&P 500 Equal Weight ETF (ASX: QUS) will start trading on Friday 18 December.

There are many ETFs tracking the S&P 500 Index (INDEXSP: .INX) but the distinguishing feature of this fund is that it will invest in equal portions in each of the 500 companies.

In fact, there already is an index that represents the concept – S&P 500 Equal Weight Index (INDEXNYSEGIS: SPXEW).

The need has arisen because this year big tech has hijacked the value of the index. 

The Motley Fool reported last month that FAANGM stocks – Facebook Inc (NASDAQ: FB), Amazon.com Inc (NASDAQ: AMZN), Apple Inc (NASDAQ: AAPL), Netflix Inc (NASDAQ: NFLX), Alphabet Inc (NASDAQ: GOOGL) and Microsoft Corporation (NASDAQ: MSFT) – now make up 25% of the total market capitalisation of the S&P 500.

“We think that the need to diversify broad US exposure is more important than ever,” a BetaShares spokesperson told The Motley Fool.

“The equal weight approach reduces the risk of the portfolio being heavily exposed to a small number of ‘mega cap’ companies, and avoids the susceptibility of market-cap weighting approaches to occasionally become overly concentrated in large stocks that have enjoyed strong price momentum for some time, and so at increasing risk of an eventual performance reversal if their valuations get too extreme.”

The ticker code QUS is currently used by BetaShares FTSE RAFI U.S. 1000 ETF (ASX: QUS). But after the close of trade on 17 December, it will start afresh with the new approach.

‘Equal weight’ has actually outperformed in the long-run

BetaShares is selling the new ETF as a good long-term investment by showing that an equal-weight S&P 500 actually outperformed the standard S&P 500 over the years.

“In the almost 50 years from December 1970 to October 2020, the S&P 500 Equal-weight index returned 12.1% p.a. compared with 10.6% p.a. for the benchmark S&P 500 Index,” said the BetaShares spokesperson.

“One reason for this outperformance is that an equal-weight approach provides greater exposure to smaller cap stocks, which on average tend to offer the greatest growth potential.”

The change in investment philosophy is also coming with a bonus – a reduction in management fees. The current BetaShares FTSE RAFI US 1000 ETF charges 0.4% per annum while the new fund will slug 0.29%.

This is not the only ETF that BetaShares is resetting. Wednesday 16 December will see the BetaShares Diversified High Growth ETF (ASX: DHHF) change into BetaShares Diversified All Growth ETF (ASX: DHHF).

The “all-growth” label for that new fund has been controversial, with BetaShares admitting many companies that are more than 100 years old are in the portfolio.

More reading

• New ‘all-growth’ ETF lists on ASX next month

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Tony Yoo owns shares of Alphabet (A shares) and Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Amazon, Apple, Facebook, Microsoft, and Netflix and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia has recommended Alphabet (A shares), Amazon, Apple, Facebook, and Netflix. 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 Link Administration Holdings Ltd (ASX: LNK) share price will be on watch on Thursday following the release of an update on the SS&C Technology takeover proposal.

What did Link announce?

On Monday, Link revealed that it received a conditional, non-binding indicative proposal from SS&C Technology to acquire it by way of a scheme of arrangement at an indicative cash price of $5.65 per share.

This was a 4.6% premium to the takeover offer it recently received from the Pacific Equity Partners and Carlyle Group consortium.

Today’s announcement reveals that the Link board has carefully considered the SS&C proposal. This includes obtaining advice from its financial, tax, and legal advisors.

According to the release, the board notes the SS&C proposal is non-binding and indicative in nature, and subject to numerous conditions. These conditions include due diligence, unanimous Link board approval, and SS&C securing debt financing.

Furthermore, the Link board considers that the SS&C proposal does not represent compelling value for shareholders on a control basis.

Nevertheless, as with the Pacific Equity Partners and Carlyle Group consortium, the board considers it appropriate to provide SS&C with due diligence information on a non-exclusive basis. This is so that it can develop a proposal that may be capable of being recommended to shareholders.

It has advised that the due diligence information will be provided subject to entry into an appropriate confidentiality agreement containing suitable protections for Link. This includes a stand-still clause.

Once again, the company has warned that there is no certainty that such a proposal will eventuate and shareholders do not need to take any action in relation to the proposal. As always, the Link board advised that it will update shareholders if there are material developments in the future.

More reading

• Link Administration (ASX:LNK) share price in focus following business update
• ASX 200 up on Tuesday
• ASX 200 up 0.1%: Bank of Queensland update, Link jumps, Woodside CEO to retire
• Why Adairs, Link, Nuix, & Tyro shares are charging higher
• Link (ASX:LNK) share price on watch after receiving second takeover approach

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Link Administration Holdings Ltd. The Motley Fool Australia has recommended Link Administration Holdings Ltd. 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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