Nelson Peltz Just Got a Near $9 Billion Reality Check

Nelson Peltz’s initial attempt to buy fund manager Janus Henderson Group Plc for $46 a share — a mere 10% takeover premium — was shamelessly cheap. And the renowned shareholder activist was lucky to get the board to accept a sweetened $49 offer, worth $7.4 billion, with a less brazen but still cheeky premium of 18%. Now a rival bidder has surfaced. The market is doing its job by helping Janus investors get better value.

Thursday saw Victory Capital Holdings Inc. publish a proposal to buy Janus for about $57 a share in cash and stock, worth nearly $9 billion. It’s a bold move. Victory is an industry minnow. It went public in 2018 and had a market capitalization of roughly $5 billion at Wednesday’s close. The idea is to borrow heavily to fund the cash component of the purchase price and then merge the companies, leaving Janus shareholders with a minority stake in the enlarged, leveraged business.