Miton Group has announced plans to sell its Liverpool fund management business, Miton Capital Partners Limited (MCPL).
A statement from the group said there was “less prospect of rapid growth of its assets under management compared with other parts of the group, so the approach represented a good deal for both shareholders and clients”.
The review followed an unsolicited offer from Seneca Investment Managers, an asset management company formed in 2010 to provide investment services to high net worth clients. Miton added the proceeds from the deal will reduce the group’s regulatory capital requirement and finance continued growth.
The funds currently managed by MCPL are the CF Miton Distribution Fund, the CF Miton Diversified Growth Fund and the Midas Income & Growth Trust. Following the transaction MCPL will be renamed Seneca Investment Managers with the current investment team remaining in place and overseen by new chief executive Stuart Eaton, while the two Oeics will be rebranded to reflect their new ownership.
Under the proposed sale, which is subject to FCA approval and expected to complete in early Q2, Miton Group will receive £3.5m for MCPL payable on completion and a further amount representing the net assets at completion estimated to be roughly £1.9m payable three months after completion or by June 30 2014 – whichever is later – in addition to a potential deferred payment of up to £1m.
MCPL is responsible for the investment management contracts for multi-asset funds managed from Liverpool and equity funds managed from London. However, only the contracts for the Liverpool-based funds, with AUM of approximately £450m, will pass to Seneca.
Ian Dighé, executive chairman of Miton Group, said: “The clients investing in our Liverpool funds have enjoyed improved performance over recent years, and we believe the improved trend will be sustained following the transaction with Seneca.”
Stuart Eaton, chief executive of Seneca Investment Managers, added: “Miton Capital Partners is a perfect fit for us - strategically, logistically and geographically. We had wanted to expand our asset management operations in order to offer a more holistic proposition to our clients; and the funds and experience we have acquired enable us to do just that.”
Meanwhile Miton Group’s trading statement, also released today, showed assets under management increased £1.3bn in 2013 to £3.1bn as the acquisition of PSigma and organic growth both provided a boost.
It noted that nearly half of its assets are in defensively-positioned multi-assets funds, including products managed by Martin Gray, while three new equity funds attained more than £50m of assets each.