(Alliance News) - Liontrust Asset Management PLC on Tuesday said it has agreed to buy UK peer Majedie Asset Management Ltd for up to GBP120 million in cash and shares.
Liontrust said the acquisition of Majedie will add GBP5.8 billion in assets under management and advice, raising its total to more than GBP42.3 billion. It said the purchase will be earnings enhancing for adjusted diluted earnings per share, starting from the financial year ending March 2023.
Liontrust will issue up to GBP97.0 million in new shares, plus pay up to GBP23.0 million in cash, to buy Majedie.
It will issue 3.7 million new Liontrust shares to Majedie shareholders for GBP80 million in initial consideration. Additionally, up to GBP8.3 million will be paid in cash and shares once Majedie's net asset value is agreed. A further GBP31.7 million in cash and shares is contingent on Majedie's performance through to 2025.
Majedie Chief Executive Officer Rob Harris will join Liontrust as head of Global Institutional Business.
"Majedie is an important acquisition for Liontrust because of its strong presence and reputation in the institutional market," explained Liontrust Chief Executive John Ions. "Liontrust has been increasing our number of institutional clients and the purchase of Majedie will hasten this expansion by enhancing our investment capability and client service credentials."
Majedie Investments PLC noted the acquisition of its investment manager, in which it holds a big stake. Majedie Investments said the deal values its 17.6% stake in Majedie AM at GBP22.4 million, plus up to GBP5.7 million in deferred consideration in 2025. It will reflect this in an update to its net asset value.
Liontrust shares were up 0.3% at 2,276.47 pence on Tuesday morning. It has a market capitalisation of about GBP1.4 billion. Majedie Investments was up 5.9% at 239.35p.
By Tom Waite; thomaslwaite@alliancenews.com
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Majedie Inv. (MAJE)