Bidding War Intensifies for Janus Henderson as Trian and General Catalyst Raise Offer
The takeover battle for asset management firm Janus Henderson has escalated dramatically, with Nelson Peltz's Trian Fund Management and General Catalyst increasing their cash offer to $52 per share, up from $49. This move heats up the bidding war with rival suitor Victory Capital, which previously shocked the market with its own aggressive proposal.
Revised Offers and Market Valuations
On Tuesday, Trian and a group of investors led by General Catalyst announced they had raised their all-cash offer to $52 per share, equivalent to approximately £38.8. This values the British-based firm at around $8 billion, a significant increase from their initial agreement to buy Janus Henderson for $49 per share, which valued the company at $7.6 billion.
The increased offer comes in response to Texas-based Victory Capital's unexpected intervention. Victory swooped in with a cash and share offer that values Janus at $8.6 billion, offering $40 per share, up from $30 in February. Victory Capital claims this $10 increase provides significantly greater certainty to Janus Henderson shareholders.
Board Support and Shareholder Dynamics
Janus Henderson's special board of advisers has thrown its support behind Trian and General Catalyst's proposals, arguing that Victory Capital's offer was not in the best interest of the group or its shareholders. In contrast, Victory Capital hit back, asserting that the combined company would be highly diversified and better positioned to compete at scale.
Victory also criticized the Trian deal, claiming it would place Janus Henderson under a newly created acquisition vehicle with no operating experience and offers no benefits of incremental scale. Trian already holds a 20 percent stake in Janus Henderson, adding complexity to shareholder approval processes.
Following the revised offer, Janus Henderson's share price jumped 2.8 percent in morning trading to $52, reflecting market optimism about the bidding war.
Clashing Over Janus and Closing Risks
Earlier this week, Victory Capital accused Trian of spreading misinformation about its offer. However, Janus Henderson's board warned of significant closing risks in Victory's bid. The board highlighted that due to Trian's large stake, shareholder approval would face active opposition from a significant shareholder and expressed concerns about Victory's financial arrangements to fund the deal.
The committee stated, The purported headline price offered by Victory is illusory if that transaction never closes. Despite meeting with Victory six times since its initial bid, the board does not believe the firm's proposal will ever be actionable, adding that the definition of insanity is doing the same thing over and over again and expecting different results.
To incentivize a deal, Janus Henderson announced that if an agreement with Trian and General Catalyst is not completed by the end of June, it will pay an extra dividend of $1 per share every quarter from July until closure.
Changing Landscape in Asset Management
This bidding war occurs amid a wave of consolidation within the asset management industry, which faces higher costs and investors shifting money from actively managed funds to cheaper index-tracking alternatives. Recent deals include US asset manager Nuveen acquiring London stalwart Schroders in a surprising £9.9 billion deal and Natwest purchasing Evelyn Partners for £2.7 million.
These transactions have raised questions about the longevity of the UK asset management sector and concerns about further consolidation. Janus Henderson was formed in 2017 from the merger of US group Janus and UK-based Henderson Global Investors, managing nearly $500 billion in assets. Victory Capital, founded in 2013 following a managed buyout from Keycorp, has $327 billion in assets under management.
Official Statements and Upcoming Vote
In a press release issued on Tuesday, Janus Henderson confirmed its special committee received a revised unsolicited non-binding proposal from Victory Capital. The release emphasized that the firm's merger agreement with Trian remains in full force and effect and the board has not withdrawn or modified its recommendation that shareholders vote in favor of approving the merger agreement.
The critical shareholder vote is scheduled for 16 April, which will determine the outcome of this intense corporate battle.
