Asset manager Gresham House has agreed a £470mn deal which will see it taken over by US-based private equity firm Searchlight Capital.
In an update to the stock exchange today, the boards of Gresham House and Seed Bidco, a newly incorporated entity formed by funds advised by Searchlight Capital Partners, said they have reached agreement on a recommended final cash offer for Gresham House by Bidco.
The deal values the entire share capital of Gresham House at approximately £469.8mn on a fully diluted basis and values the firm at approximately £440.6mn on an enterprise value basis.
Anthony Townsend, chairperson of Gresham House, said: "Since the management buy-in in 2014, Gresham House has been transformed into a leading specialist alternative asset manager.
“Today's offer delivers shareholders a 4x return over this period. The Gresham House board believes that it represents a compelling opportunity in the current challenging economic environment for shareholders to realise, with certainty, Gresham House's potential for long-term future value creation.
"The acquisition by Searchlight starts a new and exciting chapter for Gresham House. We are confident that Searchlight will accelerate our international and domestic growth strategy and their long-term capital and global expertise will support and enhance our investment teams' ability to deliver returns to clients".
Under the terms of the agreement, each Gresham House shareholder will be entitled to receive 1,105 pence in cash.
The Gresham House directors, who have been advised by Evercore and Blackdown Partners, said the term is fair and reasonable.
Accordingly, the Gresham House directors intend to recommend unanimously that Gresham House shareholders vote in favour of the scheme at the court meeting.
James Redmayne, partner at Searchlight Capital Partners UK, said: "We are excited to invest in Gresham House and partner with Tony Dalwood and his highly talented management team.
“Their achievements in building Gresham House over the past eight years to its position as a leading natural capital and sustainability focused asset manager have been hugely impressive".
Giles Marshall, partner at Searchlight Capital Partners UK, LLP, added: "We very much look forward to supporting the team in the coming years, both through capital to help drive their organic and inorganic growth plans, as well as providing access to Searchlight's extensive international network.”
sonia.rach@ft.com
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