Good evening,

Netwealth was Melbourne Cup day party pooper on Tuesday, breaking with tradition and disclosing its all-scrip offer for Praemiumon Cup day in a bid valuing the company at $785 million. The fact that Netwealth disclosed the offer at all – and not Praemium – tells you everything you need to know about the situation.

Netwealth’s been circling Praemium for months, if not years, knowing it would add scale to what is already seen as a market-leading independent wealth platform.

Netwealth finally made its move last week, stumping up an indicative offer that would have seen Praemium shareholders take about 15 per cent of the combined group. It is understood that offer was due to explode on Wednesday.

It turns out the offer has already exploded, because Praemium detonated it with a swift rejection. It has a few balls in the air and isn’t in the mood to entertain what it sees as a lowball bid.

The whole affair will have both companies and their advisers talking to their shareholders to plan their next moves. Praemium may not like the look of Netwealth’s scrip, at least at the ratio put forward, but it is now in play.

In Street Talk tomorrow, we look at tech play Mr Yum, which has fallen on to Tiger Global’s radar, and reveal Macquarie Capital’s pitch for Axicom.

Happy reading,

Anthony Macdonald, Yolanda Redrup and Kanika Sood
Street Talk editors