Blue Sky in discussions to receive lifeline from US investment firm

Blue Sky in discussions to receive lifeline from US investment firm

Embattled investment company Blue Sky Alternative Investments (ASX: BLA) has confirmed rumours that it is in discussions with a US based investment firm that could potentially save the company.

Following a report on Thursday by The Australian Financial Review, Blue Sky has confirmed rumours that it is in talks with Los Angeles-based investment firm Oaktree Capital Management.

In a release to the ASX, Blue Sky confirmed that is "in discussions" with Oaktree in relation to a possible investment by Oaktree in Blue Sky's business.

"These discussions are subject to negotiation and agreement as to investment structure and due diligence and there is no certainty that they will result in a transaction," says Blue Sky.

The discussions with Oaktree are part of a strategic review, announced by Blue Sky in May, to ensure each of its business units remains competitive.

On Thursday, the AFR reported that Oaktree is working on a debt investment that would support the balance sheet of Blue Sky and its underlying investments.

An investment by Oaktree could not come at a better time for Blue Sky, which has been under siege from investors following a damning report by US-based short seller Glaucus.

According to the AFR, the deal would give Blue Sky a significant enough amount of funds to demonstrate to investors that is has sufficient liquidity.

Following the AFR report, Blue Sky gained 9.9 per cent to land at $1.84 per share.

However, the investment firm's shares plummeted earlier this year after Glaucus said the business overstated its fee assets under management while charging expensive fees to investors.

When the Glaucus report was released, BLA shares were trading at around the $11.50 mark, and have since slumped to $1.50.

The fallout from the Glaucus report led to two board purges and the resignations of managing director Robert Shand, followed by chairman John Kain, along with board members Elaine Stead and Nicholas Dignam.

Shares in Blue Sky closed 9.25 per cent up to $1.83 per share on Thursday afternoon.

More here:

Lenard's back in founder's control after Blue Sky takes flight

Blue Sky bounces back in June

Blue Sky darkens on latest $60 million hit and share price freefall

Blue Sky in trading halt ahead of major review

Blue Sky confirms KPMG to carry out comprehensive review

Brisbane's Top 50 Companies 2018 revealed

Blue Sky turmoil continues with board purge, further share slide
 

Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

A game changer? Aspiring to the new standard on workplace mental health
Partner Content
Work health and safety regulators have been more active in the area of mental health ri...
Aon
Advertisement

Related Stories

Retailers set for pre-Christmas spree as hospitality takes a bigger bite

Retailers set for pre-Christmas spree as hospitality takes a bigger bite

Australian retailers are heading for another big spending spree ove...

Angry merchants make good on class action against Tyro Payments

Angry merchants make good on class action against Tyro Payments

Disgruntled merchants have made good their threats to sue Tyro Paym...

NSW tourism and events sector gets $530m shot in the arm

NSW tourism and events sector gets $530m shot in the arm

As New South Wales blasts through vaccine milestones, the state gov...

Melbourne hearing tech startup Hemideina taking on Cochlear with $10m Series A raise

Melbourne hearing tech startup Hemideina taking on Cochlear with $10m Series A raise

A female-led medical technology company is lifting the frequency of...