(Alliance News) - Duke Royalty Ltd on Monday said it has invested an additional GBP1 million into existing royalty partner Lynx Equity UK Ltd.
The investment will be used to fund Lynx's acquisition of Danish door manufacturer Arkas AS, agreed in February.
The GBP1 million amount brings Duke's investment in Lynx to GBP13 million, resulting in Duke being entitled to GBP1.7 million in distributions annually, reflecting a cash yield of 13% on total invested capital.
"This latest deal increases our royalty income and further diversifies our portfolio, but most importantly, it improves the royalty coverage ratio for the portfolio. Lynx's focus on acquiring profitable companies at a reasonable multiple is key to their success over the last 12 years. This follow-on epitomises our strategy to become a long-term funding partner to businesses in the UK and Europe," said Duke Royalty Chief Executive Neil Johnson.
Duke Royalty shares were trading 14% lower at 30.90 pence each at midday Monday in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
Duke Capital (DUKE)