Challenger votes to merge with CPH

Challenger International’s shareholders have approved a merger withCPH Investment Corporation(CPHIC) today, voting to join the Kerry Packer-backed company to access its capital.

The $1.1 billion merger was approved with 181.5 million votes in favour, 4.67 million against and 86,965 abstaining.

Another 15.1 million votes left open were added to the votes in favour of the merger between the groups.

Chairman Gil Hoskins says that the merged entity has the ability to become a significant diversified financial services group with a market capitalisation of a top 100 ASX listed entity.

He says it is likely that Challenger would have been constrained in its future growth if it had been unable to raise capital through the merger, though it currently meets all regulatory requirements.

“Challenger could continue to go it alone but the risks are great and the outcome is less certain,” Hoskins says.

“This merger represents the marriage of a business and capital, and will produce a strong group well equipped to grow into the future with access to capital,” he says.

Hoskins says that the cash assets of CPHIC will mean a $235 million injection into the group’s life companies, to ensure they are in the best position to meet all regulatory requirements.

The new merged group will be renamed the Challenger Financial Services Group. CPHIC shareholders will vote on the merger at a meeting tomorrow.