(Alliance News) - Pollen Street Secured Lending PLC on Friday said it believes that a cash offer from Waterfall Asset Management LLC would represent the best outcome for shareholders as it confirmed Waterfall as its new investment manager.
Pollen Street Secured Lending is a trust part of the Pollen Street Capital Group that also owns Honeycomb's investment manager Pollen Street Capital Ltd.
The trust also said it continues to review all options in the event that its possible takeover cash offer by funds advised by Waterfall does not proceed. It stated it believes a cash offer from Waterfall would represent the best outcome for shareholders, adding that it does not believe the offer from Honeycomb Investment Trust PLC compares favourably in value or liquidity terms.
Earlier in August, Honeycomb announced its intention to merge with Pollen Street, stating that the merger allows both companies to increase their scale with assets totalling around GBP1.5 billion, diversify its portfolio and put a combined entity in a place to "take full advantage of any improvement in the market environment."
It added that Pollen Street shareholders will receive 0.9 shares in the trust for each share of its own, giving shareholders approximately 65% of combined group ownership. On Friday, it said it plans to launch a GBP200 million share buyback following the completion of the proposed merger.
Turning to Waterfall's recent appointment as its investment manager, Pollen Street said it believes the appointment would materially increase the likelihood that a firm all cash offer will be brought to the table for shareholders to consider.
"Waterfall looks forward to working with the board to deliver their mandate to provide shareholders with the enhanced liquidity that they are seeking and manage the fund in a transparent manner at materially lower management and performance fees than under the existing IMA," Waterfall said on Friday.
Pollen Street Secured Lending shares closed 3.0% higher at 820.00 pence each on Friday in London. Shares in Honeycomb closed 3.8% higher at 791.49 pence each.
By Ife Taiwo; ifetaiwo@alliancenews.com
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