Transact and James Hay bids push Nucleus shares up 35%

Transact and James Hay bids push Nucleus shares up 35%
 Credit: Jason Alden/Bloomberg

Transact and James Hay are among several interested parties bidding to buy adviser platform Nucleus.

A stock exchange announcement, published today (December 2), confirmed that Transact’s parent company Integrafin Holdings and private equity firm Epiris, which owns James Hay, are in talks over proposing cash offers for Nucleus.

Nucleus has also received proposals from private equity house Aquiline Capital Partners and fund distribution platform Allfunds.

Shares in Nucleus have risen by more than a third (35 per cent) off the back of the news, from £1.35 to £1.80 a share. 

Currently, advice network Sanlam owns around 52 per cent of the adviser platform. According to the stock exchange announcement, Sanlam is supportive of Nucleus engaging in the potential sale.

Nucleus added: “The company intends to work constructively with Sanlam UK Limited to ensure that the interests of all shareholders are properly considered. 

“There can be no certainty that any offer for Nucleus will be made, nor as to the terms on which any offer might be made.”

The pace of merger and acquisitions activity in the platforms market has been on the up over the past few years.

Last November Embark’s expansion in the platform space continued with the company’s acquisition of the Zurich platform, just months after it bought the advised business of Alliance Trust Savings from Interactive Investor.

Interactive Investor later went on to buy its rival The Share Centre while M&G bought the Ascentric platform from Royal London.

Private equity firms, such as in the case of Epiris and James Hay, have also reared their heads into the platform world.

Last month, the City watchdog gave the green light to Wealthtime being snapped up by private equity company AnaCap Financial Partners.

Despite today’s jump, Nucleus’s share price is down 27 per cent over the past five years.

Earlier this year, the platform told FTAdviser it was aiming to be the top dog of platform technology in the UK by piling £3m a year into its technology department.

But the announcement came as its profits tumbled 64 per cent year-on-year, partly due to the fact the platform had decided not to cut back on expenditure after markets tumbled in March.

Last month, Nucleus brought its technology in-house by buying up certain assets of OpenWealth.

It said the move would help it scale up its technology offering and, in turn, attract larger numbers.

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