Perpetual's Takeover Bid Validates a Long-Ignored Valuation Gap

Passive-flow-driven weakness pushed Perpetual to five-year lows, before successive EQT AB takeover bids proved the market had been underpricing its Asset Management and trustee businesses.

31 Jul 2026 · 3 min read

Perpetual Limited fell to five-year lows amid passive-flow-driven weakness and one-off transformation costs, before a wave of successive takeover bids from EQT AB, rising from A$21.64 to A$22.50 a share, validated fund managers' long-held view that the market wasn't paying up for the quality of its underlying Asset Management and trustee businesses.

A passive-flow-driven decline masking underlying value

Spheria Asset Management said Perpetual declined 11 percent during the month, with very few active investors on the register leaving the share price at the whim of passive flows, with the result in late August sound but littered with one-off transformation costs, a little concerning since there would be no obvious cost reductions to flow to shareholders, though the fund believes very little value, if any, is ascribed to Perpetual's Asset Management division in the current valuation.

Perpetual declined 11% during the month with very few active investors on the register leaving the share price at the whim of passive flows. We believe however, that there is very little value (if any) ascribed to PPT's Asset Management division.

— Spheria Asset Management, Quarterly Report, September 2025

A takeover approach validates the valuation gap thesis

Spheria Asset Management said two holdings, Perpetual and Steadfast, both received takeover approaches after their share prices had fallen to five-year lows, viewing this as tangible validation of the valuation gap the fund had been highlighting: when the market won't pay up for quality, someone else usually will.

Two holdings - Perpetual and Steadfast - both received takeover approaches after their share prices had fallen to five-year lows. We view this as tangible validation of the valuation gap we have been highlighting: when the market won't pay up for quality, someone else usually will.

— Spheria Asset Management, Monthly Report, June 2026

A trustee business worth more than successive bids suggest

Katana Asset Management said Perpetual rallied on successive incremental bids from a potential suitor, with the current offer price at $22.50 a share, believing this significantly undervalues the world-class trustee business, remaining a firm hold. Blackwattle Investment Partners said Perpetual received an unsolicited, non-binding, conditional bid from EQT AB to acquire all shares for A$21.64 cash per share on 1 July, subsequently revised higher twice, first on 15 July to A$22.07 and then again on 26 July to A$22.50, with the board not believing the indicative proposal is in the best interest of shareholders, though agreeing to allow EQT access to limited, non-public information.

PPT received an unsolicited, non-binding, conditional bid from EQT AB, to acquire all of the shares in Perpetual for A$21.64 cash per share on the 1st of July. This bid was subsequently revised higher twice, the first on the 15th of July to A$22.07 and then again on the 26th of July to A$22.50. While the board does not believe the Indicative Proposal is in the best interest of its shareholders, they have agreed to allow EQT access to limited, non-public information.

— Blackwattle Investment Partners, Monthly Report, July 2026

What fund managers say they are watching next is whether EQT AB submits a further improved bid given the board's view that A$22.50 undervalues the trustee business, resolution of the limited due diligence access granted to EQT, whether the Asset Management division's value gets properly recognised in any final deal terms, and whether other suitors emerge given the validated valuation gap.