News blog
Westhouse Holdings
- BY: Andrew Hore |
- POSTED: 08/08/2010 |
Aim adviser Westhouse has secured £3.5m to spend on growing its operations.
The cash is coming from a subscription for a perpetual convertible loan by Bermuda Commercial Bank. BCB may syndicate up to £900,000 of the loan with some of Westhouse’s existing investors. The interest rate is 5% until the end of September 2015, when it increases to 8%.
Westhouse does not have to repay the loan but it is likely to be converted in the future. The conversion price is dependent on the level of Westhouse’s shareholder funds but it will be a minimum of 50p a share and a maximum of 60p a share. If the share price exceeds 90p a share for 90 consecutive trading days then Westhouse can insist that the loan is converted into shares at a price based on the conversion terms at that point. The shares issued would equate to up to 38% of the enlarged share capital.
Westhouse will use the cash to build up its expertise in the investment trust, clean energy and agribusiness, and technology sectors. Westhouse is keen to add clients but it only wants to take on new clients which it can make money out of over a two year period.
Westhouse already had £1.7m in the bank at the end of July 2010 and it still has non-core investments to sell.
First half trading has been difficult but M&A work has picked up since the end of June.
The share price fell by 13% to 46.5p following the announcement of the convertible. Westhouse is valued at £5.33m.
The interim figures will be published towards the end of September.
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