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In a historic move to untangle one of Australia's most enduring corporate entanglements, Washington H. Soul Pattinson and Co. Ltd. and Brickworks Ltd. unveiled plans Monday to merge into a single AU$14 billion ($9.1 billion) powerhouse, bringing an end to a complex cross-shareholding structure dating back to 1969.

The all-Australian union, poised to become one of the top 40 firms on the ASX, aims to streamline governance, unlock trapped capital, and position the new entity for agile acquisitions and broader investor appeal. In a corporate world often compared to a game of chess, this long-awaited consolidation clears the board for bolder, faster moves.

Cross-Shareholding No More: Simplifying the Spaghetti

Under the proposed terms, the two companies' interlocked holdings—totaling 148 million cross-held shares—will vanish, replaced by a new, ASX-listed entity retaining the Soul Patts name. Soul Patts shareholders will receive one-for-one shares, while Brickworks investors will get 0.82 shares per Brickworks share, reflecting a 10.1% premium over its most recent price.

That premium may have sparked Monday’s 27% surge in Brickworks stock, which closed at AU$35.10, while Soul Patts rose 16% to AU$43, signaling strong investor enthusiasm for the merger’s potential.

New Governance, Same Philosophy

The merged entity will be helmed by current Soul Patts CEO Todd Barlow and Chair Rob Millner, preserving the company’s signature investment approach while embracing operational efficiency.

In a webcast presentation, Barlow reassured investors:

“It is extremely important that we adhere to the same processes and disciplines that have been creating enduring success for our shareholders for many decades.”

A single board and executive team will now oversee the entity, streamlining strategy and decision-making after decades of parallel—but intertwined—leadership structures.

Shareholder Breakdown and Capital Strategy

Upon completion, Soul Patts shareholders will own 72% of the new group, Brickworks 19%, and new investors 9%, bolstered by a fully underwritten AU$550 million capital raise, arranged by Aitken Mount Capital Partners. The funding will cover transaction costs, debt reduction, and liquidity options for Brickworks shareholders.

Financial advice is flowing in from top-tier firms: Pitt Capital Partners is guiding Soul Patts, while Citigroup Global Markets Australia is representing Brickworks. Ashurst LLP and King & Wood Mallesons are acting as legal counsel.

Conditions and Timeline

The merger is slated for completion in H2 2025, contingent on shareholder approval, and an independent expert's confirmation that the deal serves both parties’ best interests. No superior proposals must emerge before the deadline.