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SYDNEY - ANZ Banking Group raised its offer to buy the rest of E*Trade Australia by over 6 per cent after an independent expert ruled its original bid was not fair.
ANZ, Australia's third-biggest lender, lifted its offer price to A$4.30 ($4.83) a share from A$4.05 announced in February, to buy the 65.8 per cent it does not own in E*Trade, valuing the online stock broker at A$432 million.
E*Trade shares jumped A12c to A$4.30 by the close of trade yesterday.
Last month independent expert Grant Samuel & Associates valued E*Trade shares in a A$4.22-A$4.74 range and described ANZ's first offer as neither fair nor reasonable.
ANZ said yesterday that the offer was final in the absence of any superior proposal. E*Trade independent directors have recommended shareholders accept ANZ's revised offer, again in the absence of any higher superior offer.
ANZ has also offered a scrip alternative which would allow E*Trade shareholders to benefit from capital gains tax rollover relief.
IWL, a fund manager and sharebroker, last month said it was eyeing a bid for E*Trade after building a small minority stake.
Fund manager Caledonia Investments also increased its stake in E*Trade to about 12 per cent, raising speculation it could probably block the offer.
ANZ wants the Sydney-based company to capitalise on a surge in equities trading. The average number of daily share trades in Australia jumped 50 per cent in the six months ended December 31, with 147 new listings.
"I think it was inevitable they'd have to raise the offer," said David McDonald, an analyst at Shaw Stockbroking in Sydney. "Still, it's not a huge increase in price, so there may be some investors holding on for now."
E*Trade has 26 per cent of Australia's online broker market, according to Grant Samuel. It trails Commonwealth Securities, known as CommSec, a unit of Commonwealth Bank, which has about 54 per cent.
New York-based E*Trade Financial sold its minority shareholding in E*Trade Australia in March.
- REUTERS, BLOOMBERG
