June 17, 2020 / 9:03 AM / 21 days ago

CORRECTED-Australia's Westpac to exit Pendal in a $128 million stake sale (June 17)

(Corrects figure in 5th paragraph to A$1.08 billion from A$2 billion)

June 17 (Reuters) - Westpac Banking Corp said on Wednesday it would sell its remaining 9.5% stake in fund operator Pendal Group Ltd for about A$185.4 million ($128.26 million).

Westpac's announcement was in line with its plans to sell the remaining 31 million shares in the investment manager, after a previous sale of Pendal shares in 2017. (reut.rs/2UOogIv)

Shares will be offered to institutional investors at A$5.98 each, a 4% discount to Pendal’s last closing share price.

After the deal, Westpac expects to add about 2 basis points to the bank’s common equity Tier 1 capital ratio and see a post-tax accounting gain in the second half of A$32 million.

It will also likely withdraw A$1.08 billion worth of funds from Pendal in two tranches by the end of 2021, the country’s no. 2 lender added.

Last month, Pendal, which was earlier known as BT Investment Management, reported a 14% decline in funds under management in the first-half led by A$2 billion worth of outflows from the Westpac book.

Swiss investment bank UBS is acting as the offer’s underwriter and bookrunner.

$1 = 1.4455 Australian dollars Reporting by Anushka Trivedi in Bengaluru, editing by Louise Heavens

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