AMP strikes historic deal, Fortescue reveals record shipments and Pushpay indicates several interested buyers

AMP Dexus Fortescue Pushpay Vulcan Steel EML Payments Ramsay Healthcare FMG PPH VSL EML RSY ASX
AMP will sell local management rights of its fund management platform Collimate Capital to Dexus in a deal potentially worth more than half a billion dollars.

AMP Limited (ASX: AMP) has entered into a landmark deal with property trust Dexus this week that could be worth up to $550 million.

After quashing efforts to spin off its real estate and infrastructure equities manager Collimate Capital, AMP has opted into selling local management rights over $28 billion to Dexus.

AMP chair Debra Hazelton said the sale is a “strong outcome for AMP shareholders and Collimate Capital stakeholders”.

After weeks of speculation, discussions are expected to continue involving potential suitors for Collimate’s international infrastructure equity business.

AMP said there are “a number of approaches from parties interested in acquiring the business”.

The Dexus deal includes an upfront cash payment of $250 million and an earn-out consideration of up to $300 million depending on the size of the local investor pool.

AMP has rebranded its $44 billion funds management platform, changing its name from AMP Capital to Collimate Capital, ahead of an anticipated demerger and separate listing on the stock exchange later this year.

Fortescue Metals Group

Mining giant Fortescue Metals Group’s (ASX: FMG) share price is rising this week after the company revealed record shipments in its latest update, reporting 139.5 million tonnes of iron ore shipped for the nine months to 31 March 2022.

However, the news hasn’t been all positive for Fortescue in its latest report.

The company explained the costs in the quarter increased, including diesel, other consumables and labour rates.

COVID-19 labour constraints, with the workforce being “significantly below” the project workforce plan for the March quarter are other factors considered.

The Iron Bridge magnetite project in Western Australia has suffered also, with ongoing supply chain issues, higher construction costs, and higher logistics and shipping costs.

Fortescue has also seen costs rise 3% causing it to increase the capital estimate for Iron Bridge by $300 million on each end to US$3.6-3.8 billion (A$5-5.3 billion).

Despite the cost increases, Fortescue and partner Formosa Steel remain adamant on bringing forth the Iron Bridge project.

Fortescue chief executive officer Elizabeth Gaines said the company is still “well placed to finish the financial year strongly, as it continues to meet demand from our customers and deliver on our strategic priorities”.

Pushpay

Pushpay Holdings (ASX: PPH) shares have risen 23% in the past five days to sit at $1.19, as a result of ranging interest from a number of suitors looking to acquire the company.

This week, Pushpay revealed to the public it had received a number of “unsolicited, non-binding and conditional expressions of interest or approaches from third parties looking to acquire the company”.

Pushpay’s board has appointed Goldman Sachs to assist as financial advisor, but urged there is no certainty that these expressions of interest or approaches will result in any transaction.

The future looks ominous for the New Zealand-based company after its share price dropped a long way in recent months, despite continually providing solid cash flow.

Vulcan Steel

Vulcan Steel (ASX: VSL) has increased its FY2022 earnings forecasts after the latest reports have indicated stronger-than-expected trading.

Over the past nine months to 31 March, Vulcan has seen a 34% rise in unaudited revenue, totalling $645.3 million.

On top of this, Vulcan saw a 42% lift year-on-year for the period on 6% higher sales volume in its steel segment.

Sales volume in its metal segment grew 2% and revenue 21% year on year.

Vulcan’s managing director and chief executive officer Rhys Jones says the company has stood strong during these times.

“Despite disruptions caused by COVID-19 and adverse weather in Australia, Vulcan’s operations and financial performance have remained strong in the past three months,” he said.

EML Payments

EML Payments (ASX: EML) saw its share price plummet 38% on Tuesday after its profit downgrade was announced.

The news comes on the back of ongoing struggles in Europe with a number of regulatory problems arising along with having reported lower-than-anticipated profits.

EML shares are at the lowest level since the pandemic first hindered payment stocks in March 2020.

The gift card and payment provider expects the struggles to continue.

“We now anticipate continued challenges through Q4, which has led to a reduction in the guidance range,” EML said.

The company has hired a new leadership team in Europe, including a group chief operating officer, chief financial officer, general counsel, compliance and regulatory director, head of compliance and head of risk.

Ramsay Healthcare

Ramsay Healthcare (ASX: RSY) is in the news again this week after third quarter results showed it was seriously impacted by surgical restrictions, high rates of staff absenteeism and cancellations due to patient and doctor availability.

Its unaudited group net profit slid 38.9% for the nine months to 31 March to $201.6 million, spelling trouble for the nation’s largest private hospitals operator.

In the March quarter, net profits dropped 59% to $42.7 million.

Chief executive officer Craig McNally has suggested while COVID-19 cases remain at elevated levels in the community, Ramsay expects to continue to be impacted by disruptions and the additional costs associated with such an operating environment.

Ramsay says it is well positioned to benefit from the growing backlog of elective surgery and will continue to invest in organic and inorganic initiatives to meet the forecast long-term growth in demand for healthcare services.

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