The Atlassian co-founder has been reportedly chatting to shareholders to garner support for his consortium.
Background: Mike Cannon-Brookes and investment firm Brookfield Asset Management made a $5 billion takeover bid for AGL last month. It was rejected pretty much ASAP.
What happened: Last week, MCB had another crack, this time offering $5.5 billion. But again, it wasn't enough. Cannon-Brookes said he was done with AGL, but he's reportedly been contacting shareholders to get support for his consortium.
What else: In any case, AGL reckons MCB's offer just isn't taking into consideration the value AGL could bring shareholders in the future via its demerger.
💡We often hear about mergers and acquisitions in the business world creating value for shareholders. But demergers and spin-offs can also create value for shareholders.
💡A demerger occurs when a business unit is carved out and listed as a separate company on the stock exchange. Generally, shareholders in the existing business automatically acquire shares in the newly-created, demerged biz.
💡South32 was spun-off from BHP Billiton in 2015, and has seen its share price nearly double. Domain was spun-off from Fairfax, and it's still performing well. So if MCB wants AGL, he's going to have to convince shareholders that his offer is worth more than the demerger.
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