Insights

Why Australian Finance Group (ASX:AFG) shares are falling today

Shares in the Aussie mortgage broker are under pressure right now…
The post Why Australian Finance Group (ASX:AFG) shares are falling today appeared first on The Motley Fool Australia. –

Australian Finance Group Ltd (ASX: AFG) shares have started Friday’s trade under pressure. The Aussie mortgage broker’s share price is down more than 2% after an early morning market update.

Why are Australian Finance Group shares under pressure?

The big news this morning was a delay in its proposed merger with Connective Group. The deal to create Australia’s largest mortgage aggregator with nearly 40% of the broking market was first announced back in August 2019.

Australian Competition and Consumer Commission (ACCC) approval in June 2020 sent Australian Finance Group shares soaring. However, this morning’s update indicates that the proposed merger might be on ice for the time being.

AFG needed to achieve two key things by 31 August 2021 – ACCC approval and court validation of the transaction. It got regulatory approval but a court decision has not been reached despite hearings concluding in March 2020.

According to today’s release, the Australian Finance Group has “concluded that it is not likely that the merger will be able to complete prior to the expiry of the Implementation Deed”.

AFG CEO David Baily said, “The extraordinary length of time that the judgement has taken has blocked our ability to complete this transaction”.

“Disappointingly, this means the merger is not likely to proceed at this time”, he added. It seems as though investors are similarly disappointed by the news.

Australian Finance Group shares have dipped lower on the news, but it isn’t all doom and gloom. Mr Bailey noted, “The two businesses are very complementary, and we remain convinced the merger would deliver benefits to our brokers and customers”.

That provides some hope of a future deal between AFG and Connective, even if the current Implementation Deed expires. Despite today’s movements, Australian Finance Group shares remain up 52.3% in the last 12 months with a $700 million market capitalisation.

The post Why Australian Finance Group (ASX:AFG) shares are falling today appeared first on The Motley Fool Australia.

Should you invest $1,000 in Australian Financial Group right now?

Before you consider Australian Financial Group, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Australian Financial Group wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

2 ASX shares rated as strong buys by brokers

Broker warns that small lenders are set to beat ASX bank shares

Forget CBA! Here are the 5 best performing ASX bank shares of FY21

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!