The acquisition marks the launch of Gresham House’s real assets division.
Aitchesse has assets under management of circa £193m, across a mix of managed accounts on behalf of endowments, family offices and private individuals.
On completion of the deal, Gresham House will pay approximately £4m made up of £1.8m in cash, £700,000 of short term loan notes and £1.5m in Gresham House shares at 298.5p, based on last reported net asset value at 30 June 2015.
The remaining £3.7m, made up of up to £1.5m of cash and £2.2m of shares, will be paid based on Aitchesse successfully delivering against performance targets for the period 1 July 2015 to 28 February 2018.
In other developments, the company has received notification from the Financial Conduct Authority that it is minded to authorise Grehsam House Asset Management, subject to completion of certain administrative steps that are within the control of the company and that are expected to be completed by the end of November.
The company is currently in negotiation with two banks regarding a new bank facility and has received a credit committee approved letter of offer from both.
The proposal offers are for bank facilities of approximately £7m, with an interest rate of approximately 5.25 per cent per annum. Whilst there is no guarantee that a facility will be entered into, the company intends to use the loan facility to firstly repay the loan notes to be issued to the sellers of Aitchesse; secondly replace the Co-operative Bank facility; and thirdly deploy the balance of the loan to fund future investment opportunities.
Anthony Dalwood, chief executive of Gresham House said that the acquisition of Aitchesse will generate the first business platform in its real assets division.
“This deal represents another significant achievement for Gresham House as we continue to develop organically and through acquisitions. This value enhancing acquisition supports our objective of increasing shareholder value through building assets under management to create long term sustainable profits.”
Rupert Robinson, managing director of Gresham House Asset Management, promised to invest in Aitchesse’s infrastructure and asset management resources.
“Our aim is to deliver attractive returns for our investors and make this asset class more accessible to institutional, family office and high-net-worth investors.
He added: “Forestry offers investors a unique combination of long term superior risk adjusted returns and the opportunity for individuals to pass on wealth from one generation to another free of inheritance tax.”