Soul Patts/Brickworks: 10th September Vote To Collapse Circularity

• Back on the 2 June 2025, Washington H. Soul Pattinson and Co. Ltd (SOL AU) and 42.92%-held Brickworks Ltd (BKW AU) announced that, via inter-conditional Schemes, they would merge.

• TopCo, a new ASX-listed company, will acquire all of the shares in SOL and BKW via the issuance of TopCo shares: 1:1 for SOL and 0.82:1 for BKW.

• The Scheme Booklet is now out, with Scheme Meetings on the 10th September, and expected implementation on or before the 23 September. The IE Kroll) says "fair & reasonable".

Conclusion

• Clean deal. The vote will get up.

• With a NAV for TopCo of A$13.35bn (as at 31 Jan 2025, and shares out of ~380mn [after the equity issuance and buyback]), that backs out an implied fair value of ~A$35/TopCo share.

• At the ratios of 1:1 and 0.82:1, both SOL and BKW are trading at a ~20% premiums to their respective implied value from the TopCo scrip.

• There is - or perhaps, was - imbedded value via the cross-holding.

• However, the combined market cap for SOL & BKW has increased 18% or A$3.1bn since the Offer was announced.