The acquisition trail continues into the new financial year. Another publicly-listed company has its sights set on a private entity.
Australia and New Zealand Banking Group Ltd (ASX: ANZ) is understood to be in talks to acquire accounting software firm MYOB Group from its parent company.
At market close on Thursday, ANZ shares are down 2.23% to $21.93.
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ANZ said to be acquiring MYOB
The banking giant confirmed it was in talks with MYOB's parent, private equity juggernaut KKR & Co., to acquire the accounting software firm.
It's understood the transaction could reach a settlement of $4.5 billion, according to Reuters.
If this were so, it would represent an incredible $2.9 billion gain on investment for KKR, who bought MYOB private back in 2019.
Still, ANZ has total assets of $2.4 billion in March, made up of $404 million in cash.
MYOB's public competitor, Xero Limited (ASX: XRO) has an enterprise value of $12.83 billion after adjusting its market cap for cash and debt, valuing MYOB at 35% of this amount.
ANZ's potential decision comes at a time when ASX banks have been freeing up capital to offset pressures bought on by the Reserve Bank (RBA)'s tightening policy.
Analysts at investment bank Jefferies were quick onto the update and said there wasn't necessarily a need for ANZ to own an accounting platform seeing as it has plenty of internal, comparable software.
However, the rationale behind the investment is probably to gain more customer data in order to sell more business banking products, The Australian writes.
Despite the pair being in talks on the transaction, there's been no guarantee anything will proceed, and it looks like just confirmation of interests at this stage.
ANZ shares are down more than 20% in the past 12 months, and 20% this year to date, as seen on the chart below.
