Own CBA shares? This could be the banking major's next acquisition

CBA shares are in focus amid news of a potential acquisition on the horizon.

| More on:
A close-up of a handshake depicting a business deal with one of the people in the background of the shot alongside a colleague looking pleased at the deal.

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

  • CBA shares are marching higher on Tuesday
  • The ASX 200 bank is reportedly considering acquiring ScotPac
  • CBA has not commented on the acquisition rumours

Commonwealth Bank of Australia (ASX: CBA) shares are up 1.1% as we head into the lunch hour on Tuesday.

That's broadly in line with the 1.2% gains posted by the S&P/ASX 200 Financials Index (ASX: XFJ) at this same time.

Shares in the S&P/ASX 200 Index (ASX: XJO) bank stock closed yesterday trading for $95.07. Shares are currently trading for $96.12 apiece.

At that price, CommBank has a market cap of $162.4 billion, easily holding its own as Australia's largest financial institution.

That's today's CBA share price action for you.

Now, here's what could be the ASX 200 bank's next acquisition.

What acquisition is being considered?

In news unlikely to have a material impact on CBA shares today, The Australian reports that the big four bank is carrying out exclusive due diligence to potentially acquire ScotPac.

Citing unnamed sources, the article said that CBA and ScotPac were in takeover discussion last year as CBA aims to increase its footprint in small and medium-sized enterprises (SMEs) lending.

Neither ScotPac nor CBA commented on the acquisition rumours.

If you're not familiar with ScotPac, the company was established back in 1988.

According to its website, "ScotPac is Australia and New Zealand's largest specialist provider of working capital solutions with a comprehensive range of invoice finance, asset finance and trade finance facilities."

The company supports more than 5,000 businesses and has funded $27.3 billion of invoices over the past 30 years.

With CBA remaining mum about the potential acquisition, shareholders will have to wait and see how this unfolds.

How have CBA shares been tracking?

As you can see in the chart below, CBA shares came under selling pressure alongside the broader market in mid-February.

Year-to-date the CBA share price is down 6%.

Over the longer term, the ASX 200 bank has gained 31% in five years. And bear in mind, these figures don't include CBA's twice-yearly dividend payouts.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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 »