LONDON (Alliance News) - Financial services company IFG Group PLC said on Monday it has agreed to a GBP206 million merger offer from SaintMichelCo Ltd, a unit of private equity firm Epiris LLP.
Under the acquisition's terms, Epiris will acquire IFG for 193 pence per share, reflecting a 46% premium to IFG's closing price of 132.5p on Friday last week.
Shares in IFG were 43% higher at 189.50 pence on Monday.
The acquisition is conditional on gaining at least 75% in shareholder approval at both the scheme meeting and the extraordinary general meeting, as well as being sanctioned by the High Court of Ireland.
IFG expects the acquisition to be completed in the second half of 2019. So far Epiris has obtained irrevocable acceptances from 11.0 million shares in IFG, reflecting 10% of the company's entire issued share capital.
"We are pleased to be announcing this transaction today and believe it is an excellent outcome for shareholders, for the company, and for our clients. The offer by Epiris represents a compelling opportunity for shareholders to realise an immediate and attractive cash value for their shareholding in IFG today," said Chief Executive Officer Kathryn Purves.
In a separate announcement, IFG reported a strong performance for 2018, swinging to a profit as revenue grew due to positive results in Sanderson House as well as increased interest rates.
For 2018, IFG swung to a profit of GBP450,000 from a loss of GBP381,000 the year before, as revenue increased by 12% to GBP87.6 million from GBP78.4 million.
Revenue growth was fostered by a strong performance from the Sanderson House business, while the James Hay division benefited from pricing changes as well as increased interest rates by the Bank of England leading to a rise in the margin on cash.
However, due to remaining legacy matters, including the assessment of Elysian Fuels's tax years from 2011 to 2015 by HM Revenue & Customs, IFG has not declared a final dividend for 2018 to conserve cash.
"Despite a challenging start to 2018, the underlying businesses have performed well, delivering improved performance and we enter 2019 with confidence. We continue to believe in the attractiveness of the markets in which both James Hay and Saunderson House operate, and we have confidence that both can continue to develop and maximise the opportunities ahead," Purves said.
