To The Moon

$Link Administration Holdings Ltd(LNK.AU)$ has been in the news lately as it was the subject of a revised takeover offer from Dye & Durham.  Originally Dye & Durham offered AUD5.50 per share in December last year.  Then the offer was reduced to AUD4.30 per share and then the latest revised offer is now AUD4. 57 per share.  At the latest update, Link has decided that it is not recommending this offer to its shareholders.

$Link Administration Holdings Ltd(LNK.AU)$provides financial services administration through its 4 business divisions.  They are Retirement and Superannuation Solutions, Corporate Markets, Fund Solutions and Banking & Credit Management.  

Link's strongest business division is the Australian fund administration business.  Contract lengths of 3 to 5 years and switching costs ensure recurring revenue of around 90% and client retention rate of over 95%.  6 of Link's 10 largest clients have been with Link for over 20 years.  Link's closest competitor, Mercer has only 10% of the market share. 

Link is a profitable company with a good Balance Sheet.  It has also been paying dividends regularly.  The current dividend yield is 2.6% and with 82% franking, the grossed up yield is 3.5%.

If the deal with Dye & Durham does not go through, $Link Administration Holdings Ltd(LNK.AU)$ is considering an in specie distribution of a minimum of 80% of Link's shareholding of $PEXA Group Ltd(PXA.AU)$ in order to maximise value for shareholders.  PEXA had 85% share of the Australian E-Conveyancing.  As Link owns 42% of PEXA, this is indeed Link's most valuable asset.  

$Link Administration Holdings Ltd(LNK.AU)$ is a fundamentally strong company.  Because of its share price weakness, Link has been the subject of takeovers.  Dye & Durham is the 3rd company to attempt to acquire Link in the space of just barely 2 years.  I believe Link is undervalued and oversold.   At the current price, it is worth considering as an investment.   In the meantime, the saga continues as Link will renegotiate with Dye & Durham. Stay tuned for more updates. 

@Daily_Discussion@Tiger_AU@ASX_Stars@TigerStars@CaptainTiger@MillionaireTiger