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(Adds RMG's sale of U.S. Solutions business, updates share
move)
Jan 25 (Reuters) - UK-based acquisition vehicle AssetCo
said on Tuesday it will buy investment and consulting
firm River & Mercantile Group (RMG), in a deal, which
along with a planned capital return, will value RMG at 289
million pounds ($389 million).
AssetCo fought off investment manager Premier Miton
, which pulled out of rival talks for RMG earlier this
month.
Under the terms of the deal, River & Mercantile shareholders
will get 0.07392 of a new AssetCo share for each share held,
totalling 98.8 million pounds.
In addition, shareholders are due a return of capital from
RMG's planned sale of its UK Solutions pensions business to
Schroders, bringing their total payout to 289 million
pounds.
RMG shareholders will own 41.6% of the combined group,
AssetCo said in a statement.
RMG shares rose as much as 8.8% on Tuesday to a near
two-month high of 322 pence, before ending the day 1.4% higher
on the London Stock Exchange.
Asset managers which actively manage funds, such as RMG,
have been bulking up in recent years to cut costs and fight off
competition from rivals running cheaper passive, or
index-tracking, funds.
AssetCo has bought three other asset management businesses
in the past year.
"We are very keen on the active equity business because I
think the markets are going to come our way in terms of that
type of business," AssetCo Chairman Martin Gilbert told a media
call.
Gilbert, a former co-CEO of abrdn, is also deputy
chairman of RMG.
Numis and Arden Partners advised AssetCo and Lazard and
Fenchurch Advisory advised RMG.
Later in the day, RMG said in a separate statement that it
would sell its U.S. Solutions business to Agilis Holding Co LLC
for $8.6 million, adding that the transaction was expected to
complete in the second quarter of 2022.
($1 = 0.7437 pounds)
(Reporting by Aby Jose Koilparambil in Bengaluru and Carolyn
Cohn in London; Editing by Shounak Dasgupta, Susan Fenton,
Alexandra Hudson)
