Independent Expert Critiques Perpetual's Sale to KKR

(Reuters) – Australia’s Perpetual announced on Tuesday that an independent expert has advised that the asset manager's plan to sell its wealth management and corporate trust business to KKR may not be in the best interests of investors due to an unexpected tax bill.

The A$2.2 billion ($1.40 billion) deal with the buyout giant is now at risk following a significant increase in tax liabilities and a decrease in shareholder returns.

Consequently, the estimated cash proceeds from the transaction have decreased to A$5.74 to A$6.42 per share, down from the earlier projected range of A$8.38 to A$9.82.

KKR has not yet responded to requests for comment from Reuters.

The sale could have transformed Perpetual into a standalone fund management entity during a strategic turnaround after over a century of its brand.

Morningstar analyst Shaun Ler stated, "These updates make the acquisition terms less favorable to shareholders than previously anticipated. In light of these developments, we think there is a low likelihood of the transaction proceeding in its current form."

Perpetual confirmed it is still engaged in constructive discussions with KKR regarding the deal.

($1 = 1.5711 Australian dollars)