Gilberts AssetCo raises £ 30.9 million for M&A strategy

AssetCo, chaired by former co-managing director of Standard Life Aberdeen, Martin Gilbert, is preparing to make further acquisitions after raising £ 30.9 million to fund its wealth and asset management strategy.

In a trade update today (June 28), the company reported a pre-tax profit of £ 22.3 million in its half-year results, compared to a loss of £ 0.7 million a year earlier.

Even so, it still recorded zero sales for the six months ended March 31, 2021, unchanged from 2020.

However, the company received £ 57.8m in litigation and costs during the period, of which £ 26.9m was returned to shareholders and the remainder withheld to fund its strategy.

The award was based on an appeal court ruling against accounting firm Grant Thornton after it was found liable for negligence for failing to detect fraud at AssetCo.

Gilbert, who was named chairman in March, said the six months had started with the “successful conclusion” of the Grant Thornton litigation and receipt of the remaining court verdict and costs.

“This resulted in AssetCo having cash balances of approximately £ 57.8m.

“This formed the basis for the return of £ 26.9 million to shareholders through a takeover bid and the remainder of £ 30.9 million to provide the initial resources for the company’s new wealth and management strategy.

Last month, AssetCo acquired Saracen Fund Managers based in Edinburgh for £ 2.75 million.

At the time, the purchase was said to consist of 166,904 new common shares and £ 664,774 in cash payable on closing.

The company also acquired 5 million shares in River and Mercantile earlier this year for a combined price of £ 10.4 million.

Net assets were £ 31.1 million as of March 31, 2021 compared to £ 28.4 million a year earlier, largely driven by its recent investment in the River and Mercantile Group, according to AssetCo.

In February, the board announced its intention to shift the company’s business strategy towards building an asset and wealth business.

The company’s strategy changed to “Acquire, manage and operate asset and asset management activities and interests along with other related services”. Negotiation.

As part of the new strategy, it has entered into an Appointed Agent Agreement with Toscafund Asset Management to enable it to carry out certain specified regulated activities.

Gilbert said, “Our new business strategy, approved by shareholders in April, is to invest in, build and operate asset and wealth management businesses. The financial services sector faces numerous challenges, but the importance of the industry in achieving its financial goals for clients and customers is even greater.

“We believe AssetCo can play a key role by investing in, supporting and developing companies to meet investor needs. Our investment in the River and Mercantile Group and our conditional acquisition of Saracen Fund Managers are part of that mindset.

“We hope to announce additional activities in the months ahead as we roll out AssetCo’s strategy and build the business.”

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