Australia's Magellan jumps most in nearly two decades on $1.2 billion Barrenjoey buy

Magellan Financial

03/03/2026 05:29

March 3 (Reuters) - Magellan Financial Group MFG.AX shares soared on Tuesday by their most in nearly two decades, after the Australian fund manager moved to take full control of Barrenjoey Capital Partners in a deal worth A$1.62 billion ($1.15 billion).

The stock jumped as much as 31.3% to A$11.110, its highest since August 20, as trading resumed after a halt on Monday.

It closed 21.9% higher in its best session since September 7, 2006 and was the top gainer on the broader ASX200 benchmark index .AXJO, which fell 1.3%.

Magellan said on Monday it would buy all the issued shares of financial services platform Barrenjoey that it does not currently own.

The asset manager currently holds about 36% of economic interest in Barrenjoey, and the remaining shares would have an implied total consideration of A$903 million.

This value excludes the A$148.9 million Magellan will pay Barclays for an additional economic interest of around 10% in Barrenjoey.

Analysts at Morningstar were cautious on the acquisition, saying it would do little to address Magellan's underlying challenges.

"Magellan's fundamentals are weak, with the core funds management business continuing to experience earnings declines," Morningstar analysts said in a note. "The Barrenjoey acquisition does not directly address structural pressures."

On Monday, Magellan announced a share placement to raise up to A$130 million at A$8.45 per share to fund the transaction with Barclays. It also announced a non-underwritten share purchase plan aiming to raise A$20 million at the same offer price.

($1 = 1.4061 Australian dollars)

 (Reporting by Rajasik Mukherjee; Editing by Subhranshu Sahu)

 ((Rajasik.Mukherjee@thomsonreuters.com;))