Carlyle, PEP lob new Link proposal, secure more commitments

From the afr. Hopefully see a new takeover offer tomorrow.

It's been a busy weekend for private equity firms The Carlyle Group and Pacific Equity Partners, which are in hot pursuit of ASX-listed Link Group.

It is understood Carlyle and PEP have submitted a revised proposal for Link, which values the group at more than $5.20 a share.

The private equity firms also put the revised proposal to a bunch of Link's institutional investors, fund manager sources told Street Talk.The revised proposal has both a higher price for the company as a whole and, importantly, a separate price for Link without its stake in property transaction settlements platform PEXA.

It is understood the market testing saw Carlyle and PEP increase its pre-bid commitments to more than 10 per cent. The consortium already had an agreement with Perpetual Investments, Link's biggest shareholder with a 9.65 per cent stake.

The revised proposal comes only days after Link dismissed Carlyle and PEP's initial $5.20 a share approach as"materially" undervaluing the group, and said it would consider pinching the suitors' idea to spin-off its 44 per cent PEXA stake.

The new offer, which fund managers said was indicative and non-binding like its offer disclosed last week, is sure to give Link and its investors plenty to think about - and may shift some of the focus back to Carlyle and PEP's interest in Link's core superannuation services businesses.

The added support from Link investors should also put pressure on the company to at least engage, if not grant the buyout funds due diligence.

Should the consortium have secured commitments as fund managers expect, then it is likely to have to lodge a new substantial shareholder notice in coming days.