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Perpetual, KKR cease takeover talks

On Monday 20 December 2010, 9:34

Perpetual Ltd says its takeover talks with US-based private equity firm Kohlberg Kravis Roberts & Co (KKR) have ceased after the two were unable to find agreement on the terms of the deal.

Perpetual also reiterated, in a statement on Monday, that its first half underlying profit after tax would be between $35 million and $40 million excluding costs incurred for the KKR proposal and other significant non-recurring items.

KKR made a conditional $1.75 billion bid on October 18, valuing the wealth manager and trustee at between $38 and $40 per share.

Perpetual said on Monday its talks with KKR had failed to arrive at mutually acceptable terms and, as a result, KKR's indicative proposal to acquire Perpetual's shares through a scheme of arrangement would not proceed.

Perpetual's board engaged in the discussions with KKR after forming an initial view that the proposed price did not reflect Perpetual's value, but that shareholders' interests were best served by conducting discussions to explore the offer.

But the parties had agreed that such an offer cannot be formulated, Perpetual said in a statement.

"The Board confirms that KKR will not be conducting any due diligence on Perpetual and does not anticipate any further discussions with KKR in relation to the proposal."

Separately, Perpetual said it expected to finalise the appointment of a new chief executive to replace David Deverall shortly.