Uniti (ASX:UWL) share price jumps amid rumoured Macquarie approach

Last week media speculation forced Uniti to admit it had entered into discussions with New Zealand fund manager Morrison & Co. But there may be more suitors in the wings.

A woman is excited as she reads the latest rumour on her phone.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Uniti share price outpaces the broader market on speculation that Macquarie has lobbed a higher bid
  • Uniti last week announced a non-binding cash bid from Morrison & Co worth $4.50 a share
  • A takeover auction for Uniti could be in the cards as yet another suitor may be in the wings

The Uniti Group Ltd (ASX: UWL) share price is outperforming the S&P/ASX 200 Index (ASX: XJO) this morning as new takeover rumours swirl.

This time it could be Macquarie Group Ltd (ASX: MQG) planning a move on the fibre network owner, reported The Australian.

Uniti share price jumps as rumoured new suitor appears

Mind you, it's only speculation, and Uniti remains tight-lipped on any corporate interest. But this has not stopped the Uniti share price from advancing 1.42% to $4.28 at the time of writing.

In contrast, the ASX 200 has gained 0.44%, while the Telstra Corporation Ltd (ASX: TLS) share price has added 0.3%.

Media speculation forced Uniti to admit last week that it had entered into exclusive discussions with HRL Morrison & Co. The Kiwi fund manager made a non-binding and conditional takeover cash offer valuing Uniti at $4.50 a share.

More than a love triangle

The Australian alleges that Macquarie Asset Management has given Uniti a higher offer. While the exact amount is unknown, the article suggests at least one other suitor is looking to crash the party.

This means we would see a takeover tussle for Uniti as the business owns assets that will be of interest to several parties.

Morrison & Co's bid is subject to a number of conditions and includes a break fee. This complicates the picture, but there may be a fiduciary exemption.

Conditional offer for Uniti share price

The exclusivity arrangements may not apply if there is "a bona fide, actual, proposed or potential competing proposal" that would "reasonably be expected to lead to a superior proposal," reported The Australian.

Other conditions attached to Morrison & Co's offer are satisfactory completion of the bidder's confirmatory due diligence; unanimous recommendation of the transaction from the Uniti Board; entry into a mutually acceptable scheme implementation agreement containing customary exclusivity terms, conditions precedent (including but not limited to FIRB), prescribed occurrences, and receipt by Morrison & Co of its required internal approvals.

Uniti outperforming its peers

Uniti builds and operates fibre broadband networks in residential areas. The company has also been in the spotlight as its executive director Vaughan Bowen was charged with two counts of insider trading.

The Uniti share price has surged nearly 80% over the past year. That's well ahead of its peers. The Telstra share price gained a relatively modest 17%. The TPG Telecom Ltd (ASX: TPG) share price slumped by an equal amount in the last 12 months.

Motley Fool contributor Brendon Lau owns Telstra Corporation Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Telstra Corporation Limited. The Motley Fool Australia has recommended TPG Telecom Limited and Uniti Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Mergers & Acquisitions

two men in business suits sit across from each other at a table with a chess board on it. Both hold their hands to their chins and look down in serious contemplation of their next move.
Resources Shares

'Not ruled out': Could BHP still buy Anglo-American?

This mega-deal might not be as dead as it looks.

Read more »

Happy couple looking at a phone and waiting for their flight at an airport.
Travel Shares

Flight Centre share price higher on acquisition news

The travel agent is betting big on cruises. Here's what you need to know.

Read more »

A young woman with her mouth open and her hands out showing surprise and delight as uranium share prices skyrocket
Consumer Staples & Discretionary Shares

Myer and Premier Investments shares jump on huge merger news

The two retailers are combining some of their operations. Let's dig deeper into the plan.

Read more »

a woman drawing image on wall of big fish about to eat a small fish
Mergers & Acquisitions

Guess which $9 billion company is acquiring another ASX stock

This big fish is looking to acquire a small fish in a $45 million deal.

Read more »

Two male ASX investors and executives wearing dark coloured suits sit at a table holding their mobile phones discussing the highest trading ASX 200 shares today
Mergers & Acquisitions

TPG Telecom shares rise on $5.2b asset sale to Vocus

The telco is unlocking value by divesting assets. Here's what's happening.

Read more »

A man slumps crankily over his morning coffee as it pours with rain outside.
Technology Shares

Why are Appen shares sinking today?

Let's see what is going on with this high-flying tech stock today.

Read more »

A silhouette shot of two business man shake hands in a boardroom setting with light coming from full length glass windows beyond them.
Mergers & Acquisitions

Rio Tinto share price rises on $10b Arcadium Lithium takeover deal

Management believes the deal makes it a global leader in energy transition commodities.

Read more »

A man has a surprised and relieved expression on his face. as he raises his hands up to his face in response to the high fluctuations in the Galileo share price today
Mergers & Acquisitions

Arcadium Lithium shares rocket 46% on Rio Tinto takeover approach

The mining giant could soon become the third largest lithium supplier.

Read more »