If you take a step back from the hustle and bustle of daily deals, there’s been a marked shift in conversations occurring around the market.
Australian companies, worried about share prices and the outlook for earnings, want to talk to their investment bankers about capital, not just growth.
It’s bringing back memories of 2020, late 2018 and early 2015, all periods when the market was wobbly, companies pulled their heads in and shored up defences, just in case.
Already, we’re seeing a change in the type of deals. There’s equity recapitalisations sneaking through ahead of the June 30 balance date, with BWX and Energy Resources of Australia both expected to be in the market this week.
There’s also strategic reviews considering things like demergers - such as at Suncorp, which Street Talk revealed on Sunday - while bidders and targets are trying to recut deals signed in completely different market conditions. (Suncorp’s a big story, years in the making.)
Then there’s the PE shootouts, which are continuing apace, despite obvious concerns about increased funding costs.
This week is sure to be an interesting one, as companies do what they need to ahead of the June 30 balance date.
Happy reading, Anthony Macdonald, Sarah Thompson and Kanika Sood Street Talk editors
Suncorp Group is making a fresh push to spin off or sell its banking unit and focus on its larger and arguably more valuable insurance arm, in a bid to boost returns for shareholders.
Resources banker turned private investor John Prendiville is expected to take an equity stake in stockbroker and wealth manager Wilsons, after joining the company’s board as chairman.
