Fiske is acquiring Fieldings Management in order to boost its assets under management.
A placing at 50p a share has raised £1.22m after expenses. That was a premium to the market price but it rose to 52.5p (45p/60p).
A further 515,000 shares will be issued as part of the acquisition. The initial acquisition payment is £2.3m in cash and shares, depending on the level of assets under management at the end of July. Fieldings has cash in the bank so this will equate to a cash outflow of £180,000.
There are three deferred payments one, two and three years after the acquisitions completes. If assets under management are at least maintained at the end of each July then the maximum of £261,333 will be payable each year. There are also bonus pool payments to the Fieldings employees and if income is maintained the payments will be £100,000 at the end of year one, £175,000 in year two and £225,000 in year three.
James Harrison bought 140,000 of the placing shares taking his stake to 147,000 shares, while fellow director Martin Perrin acquired 20,000 shares to take his stake to 35,000 shares. Harrison owns other shares in Fiske through a company he controls so his total shareholding is 19.7%.
Fieldings has £165m under management and this will take Fiske’s assets under management to £715m. In the year to September 2016, pre-tax profit was £315,000 on revenues of £1.32m.
In the year to May 2017, Fiske’s total commission revenues rose by 17% to £2.96m and it should be around breakeven.
Fiske has invested in IT and Fieldings will move into its offices. Cost savings should help to enhance earnings per share.
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