TIDMASTO
RNS Number : 5688T
AssetCo PLC
26 March 2021
NOT FOR RELEASE, DISTRIBUTION, PUBLICATION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO OR FROM THE UNITED
STATES OF AMERICA, AUSTRALIA, CANADA, JAPAN, OR THE REPUBLIC OF
SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO MIGHT
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH
JURISDICTION (EACH, A "RESTRICTED JURISDICTION").
Friday, 26 March 2021 Immediate Release
AssetCo plc
("AssetCo" or the "Company")
Proposed change in strategy
Publication of Readmission Document
and
Notice of General Meeting
Further to the announcement on 8 February 2021 of the Company's
intention to change its business strategy to the development of an
asset and wealth management business, the Company announces that it
has posted to Shareholders the Readmission Document, including the
Notice of General Meeting, which is now available on the Company's
website.
Key Highlights
* Change in strategy to focus on acquiring, managing
and operating asset and wealth management activities
and interests, together with other related services.
* Martin Gilbert to become Chairman and Peter McKellar
to become Deputy Chairman and Chief Executive
Officer. Tudor Davies will become a non-executive
Director of the Company.
* Implementation of annual bonus and long term
incentive plan ("LTIP"), which is designed to reward,
incentivise and retain the Company's executive
Directors and senior management to deliver
sustainable growth for Shareholders.
* Intention to seek Shareholder support to disapply
statutory pre-emption rights in respect of an amount
equal to 100% of the Existing Share Capital, to
enable the Company to raise cash to execute the New
Strategy of making strategic acquisitions and
developing the business, while widening and
strengthening the Company's shareholder base.
Tudor Davies, Chairman commented ,
"During the last year, we successfully accumulated cash balances
of approximately GBP55 million, from the realisation of receivables
and bonds from our Abu Dhabi business and the successful conclusion
of our litigation against our former auditors. However, there have
been challenges in developing an overseas business in the Middle
East, and the Board decided it was appropriate to review the
structure and future strategy of the Company. This led to a tender
offer to buy back 50 per cent. of the share capital at a cost of
GBP26.9 million, followed by the proposal to utilise the AssetCo
platform to build an exciting asset and wealth management
business."
Capitalised terms in this Announcement shall have the meanings
given to such terms in the Company's Admission Document published
today.
Enquiries:
AssetCo plc
Tudor Davies, Chairman
Tel: +44 (0) 7785 703523
+44 (0) 20 7614 5900
Arden Partners plc
Nominated adviser and broker
John Llewellyn-Lloyd / Dan Gee-Summons / Nick Wright (Corporate
Finance)
Simon Johnson (Corporate Broking)
Tel: +44 (0) 20 7614 5900
TooleyStreet Communications
Fiona Tooley
Email: fiona@tooleystreet.com
Mobile: +44 (0) 7785 703523
Maitland/AMO
Neil Bennett
Rachel Cohen
Tel: +44 (207) 379 5151
AssetCo plc LEI number is : 213800LFMHKVNTZ7GV45
This announcement is not and does not constitute or form part
of, and should not be construed as, an offer of securities for
subscription or sale in any jurisdiction. Prospective investors
should not subscribe for or purchase any securities referred to in
this announcement except in compliance with applicable securities
laws and regulation.
The following information is extracted from the Readmission
Document
Further Information
Proposed New Strategy
At present, the Company's strategy is focused on the provision
of fire and rescue emergency services in the Middle East, with one
operating branch in the UAE. In order to operate the branch in the
UAE, the Company is required to have a commercial licence for the
relevant operations undertaken there. The Company's current
commercial licence was issued on 17 September 2020 and expires on
23 September 2021. Following the loss of its key contract in Abu
Dhabi in October 2018, the Company has scaled back its existing
operations and cost base, whilst seeking new contractual
opportunities. To date, no new contracts have been won and the
Directors are currently reviewing the status of this legacy
business.
Subject to Shareholder approval at the forthcoming General
Meeting, the Directors are proposing to change the strategy of the
Company to the New Strategy of "acquiring, managing and operating
asset and wealth management activities and interests, together with
other related services". The New Strategy will principally focus on
making strategic acquisitions and building organic activities in
areas of the asset and wealth management sector where the Directors
believe structural shifts have the potential to deliver exceptional
growth opportunities. This could include strategic acquisitions of
undervalued asset and wealth management businesses which have core
capabilities that play to these structural shifts, and where active
management can unlock value.
Proposed changes to the Board
Subject to the passing of the Resolutions, Martin Gilbert will
become Chairman and Peter McKellar will become Deputy Chairman and
Chief Executive Officer. Given his other business commitments it is
anticipated that, as the Company develops, Peter McKellar will
continue as Deputy Chairman and that a full time chief executive
will be hired. On Readmission, Tudor Davies will become a
non-executive Director of the Company.
It is expected that other senior individuals from across the
asset and wealth management sector will join the business as the
Company completes acquisitions and manages activities in the
sector. It is likely that some of these individuals may be promoted
to the Board as the business develops.
History of the proposed management team
Martin Gilbert has a long history in asset and wealth
management. He co-founded Aberdeen Asset Management PLC in 1983 and
was chief executive officer from 1991 to 2017. During that period
Aberdeen Asset Management PLC grew, through a combination of
organic growth and strategic acquisition, to become one of the
world's leading independent asset managers with GBP308 billion of
AUM. In 2017, Aberdeen Asset Management PLC merged with Standard
Life plc, to become Standard Life Aberdeen plc. On merging,
Standard Life Aberdeen plc was the biggest UK-based asset
management company and the second biggest in Europe. Martin was
co-chief executive officer and subsequently vice chairman until he
retired from Standard Life Aberdeen plc in September 2020. Martin
is chairman of Revolut Ltd and Toscafund, deputy chairman of River
and Mercantile Group PLC and senior independent director of
Glencore plc, alongside a number of other directorships.
Peter McKellar has spent nearly all of his working career in
private markets, in particular private equity and infrastructure
investment management and direct operating management. He retired
in September 2020 as executive chairman and global head of private
markets for Standard Life Aberdeen plc, where he oversaw investment
management activities across private equity, infrastructure, real
estate, natural resources, and certain private credit capabilities,
totalling GBP55 billion of AUM.
Activity to date and development of an asset and wealth
management business
On 8 January 2021, the Company acquired 2,500,000 ordinary
shares in River and Mercantile Group PLC at GBP1.86 per share, for
a total consideration of GBP4.7 million paid in cash. On 5 February
2021, the Company acquired a further 2,500,000 ordinary shares in
River and Mercantile Group PLC at GBP2.28 per share, for a total
consideration of GBP5.7 million paid in cash. The Directors believe
that the investment in River and Mercantile Group PLC shares is
attractive and that this company's activities and prospects are
undervalued. In aggregate, the Company now has a 5.85% shareholding
in River and Mercantile Group PLC.
The Directors are examining a number of other opportunities and
have an active pipeline. Such opportunities include the acquisition
of existing and new asset management businesses, as well as
organically growing investment management capabilities through
lateral hires and winning new contracts. As such, the Company will
be operating in a regulated environment with the main framework for
the regulation of asset management businesses being FSMA. FSMA
regulates the provision of financial services, including investment
services, in the UK through the concept of regulated activities,
which may only be carried out by persons who hold appropriate
authorisations. As part of the New Strategy, the Company has,
pursuant to the terms of the Appointed Representative Agreement,
become an appointed representative of Toscafund in accordance with
section 39 of FSMA and the Appointed Representative Regulations.
The Company will therefore be entitled (notwithstanding the fact
that it is not itself regulated) to carry on specified regulated
activities (as regulated by the FCA) as the appointed
representative of Toscafund. Toscafund, as principal, accepts
responsibility for the Company's conduct of such activities but
only to the extent required by FSMA, the Appointed Representative
Regulations and the rules of the FCA. Over time, it is the
intention of the Board to apply for, or to acquire an entity that
has (subject to the FCA rules on change of control), the necessary
regulatory authorisations.
Trading update
With the exception of the settlement of litigation with Grant
Thornton and the Tender Offer, as announced on 2 October 2020 and 2
December 2020 respectively, and the acquisitions of shares in River
and Mercantile Group PLC, as described above, there has been no
significant change in the financial position or financial
performance of the Company since 30 September 2020, being the date
to which the latest audited financial results of the Company were
prepared.
During the period since 30 September 2020, the Company has
continued to incur ongoing running costs broadly in line with the
second half of the prior financial year. Following Readmission, the
Company's cost base is expected to increase as the necessary
elements to create an asset and wealth management platform are put
in place.
Annual bonus and long term incentive plan
The Board wish to put in place the LTIP, which is designed to
reward, incentivise and retain the Company's executive Directors
and senior management to deliver sustainable growth for
Shareholders. Under the LTIP, the Company will create a pool each
year, equivalent to 20 per cent. of the growth in total shareholder
value (including dividends), that is allocated to the executive
Directors and senior management by the Remuneration Committee. The
participants will receive one third of their allocation in cash at
the end of the performance period, with the rest received in
Ordinary Shares deferred over a five year period. The Board also
believes that the LTIP will allow the Company to attract senior
executive talent and that the key metric of total shareholder
return is aligned with, and will support the growth in returns for,
Shareholders.
Further details of the key terms of the LTIP are available in
the Readmission Document. A Resolution is being put forward at the
General Meeting for Shareholders to approve the terms of the LTIP
and to authorise the Board to formalise the plan.
Related Party Transaction
The LTIP constitutes a related party transaction pursuant to
Rule 13 of the AIM Rules for Companies. The independent Directors,
being all Directors save for Martin Gilbert and Peter McKellar,
consider, having consulted with the Company's Nominated Adviser,
Arden, that the key terms of the LTIP are fair and reasonable
insofar as the Company's Shareholders are concerned.
New articles of association
At the General Meeting, the Company is proposing to adopt the
Articles, a summary of which is set out in the Readmission
Document.
Disapplication of pre-emption rights
At the General Meeting, the Board are proposing a special
resolution to disapply statutory pre-emption rights in respect of
an amount equal to 100% of the Existing Share Capital. The Board
believes that the proposed disapplication will enable them to raise
cash to execute the New Strategy of making strategic acquisitions
and developing the business, while widening and strengthening the
Company's shareholder base.
Notice of General Meeting and Readmission
A notice convening the General Meeting is set out in the
Readmission Document. The General Meeting is to be held at 11.15
a.m. on 15 April 2021. In view of the COVID-19 pandemic and the
measures that the UK Government has put in place restricting public
gatherings, as well as for the safety of Directors, Shareholders
and advisers, this Meeting will be a closed meeting. Application
will be made to the London Stock Exchange for the Existing Ordinary
Shares to be readmitted to trading on AIM. It is expected that
Readmission will become effective and that dealings in the Existing
Ordinary Shares will recommence on AIM at 8.00 a.m. on 16 April
2021.
Action to be taken
Given that the General Meeting will be a closed meeting,
Shareholders are asked to complete, sign and return the Form of
Proxy to the Registrar, Computershare Investor Services plc, The
Pavilions, Bridgwater Road, Bristol, BS13 8AE as soon as possible
and in any event not later than 11.15 a.m. on 13 April 2021.
Recommendation
The Board consider that the Resolutions are fair and reasonable
and in the best interests of all Shareholders and the Company as a
whole. Accordingly, the Directors unanimously recommend
Shareholders to vote in favour of the Resolutions to be proposed on
a poll at the General Meeting, as the Directors, together with
other Shareholders including Harwood Capital LLP, Harwood Capital
Management (Gibraltar) Limited, funds managed by Toscafund and
Cadoc Limited intend to do in respect of their beneficial holdings
which amount, in aggregate, to 3,847,500 Existing Ordinary Shares,
representing approximately 58.9 per cent. of the Existing Ordinary
Shares.
IMPORTANT INFORMATION
This announcement does not constitute, or form part of, any
offer or invitation to sell, allot or issue, or any solicitation of
any offer to purchase or subscribe for, any securities in the
Company in any jurisdiction nor shall it, or any part of it, or the
fact of its distribution, form the basis of, or be relied on in
connection with or act as an inducement to enter into, any contract
or commitment therefor.
Recipients of this announcement who are considering subscribing
for or acquiring Ordinary Shares at a future point in time are
reminded that any such acquisition or subscription must be made
only on the basis of the information publicly disclosed. To the
fullest extent permitted by applicable law or regulation, no
undertaking, representation or warranty, express or implied, is
given by or on behalf of the Company, Arden Partners Plc ("Arden")
or their respective parent or subsidiary undertakings or the
subsidiary undertakings of any such parent undertakings or any of
their respective directors, officers, partners, employees, agents,
affiliates, representatives or advisers or any other person as to
the accuracy, sufficiency, completeness or fairness of the
information, opinions or beliefs contained in this announcement
and, save in the case of fraud, no responsibility or liability is
accepted by any of them for any errors, omissions or inaccuracies
in such information or opinions or for any loss, cost or damage
suffered or incurred, howsoever arising, from any use, as a result
of the reliance on, or otherwise in connection with this
announcement. Arden does not accept any liability, whatsoever, for
the accuracy of any information or opinions contained in this
announcement or for the omission of any information from this
announcement for which the Company and the directors are solely
responsible.
Arden, which is authorised and regulated by the Financial
Conduct Authority, is acting only for the Company in connection
with the proposed Readmission and is not acting for or advising any
other person, or treating any other person as its client, in
relation thereto and will not be responsible for providing the
regulatory protection afforded to clients of Arden or advice to any
other person in relation to the matters contained herein. Such
persons should seek their own independent legal, investment and tax
advice as they see fit. Arden's responsibilities as the Company's
nominated adviser under the AIM Rules for Nominated Advisers and
AIM Rules for Companies will be owed solely to the London Stock
Exchange and not to the Company, to any of its directors or to any
other person in respect of a decision to subscribe for or otherwise
acquire Ordinary Shares in reliance on publicly available
information. Arden has not authorised or approved the contents of,
or any part of, this announcement and no representation or
warranty, express or implied, is made by Arden or its affiliates as
to any of its contents.
Neither this announcement nor any copy of it may be (i) taken or
transmitted into, distributed, published, reproduced or otherwise
made available, directly or indirectly, in the United States
(within the meaning of Regulation S under the US Securities Act of
1933, as amended (the "US Securities Act")), (ii) taken or
transmitted into, distributed, published, reproduced or otherwise
made available or disclosed in Australia, Canada, New Zealand or
the Republic of South Africa or to any resident thereof, except in
compliance with applicable securities laws, or (iii) taken or
transmitted into or distributed in Japan or to any resident thereof
for the purpose of solicitation or subscription or offer for sale
of any securities or in the context where the distribution thereof
may be construed as such a solicitation or offer. Any failure to
comply with these restrictions may constitute a violation of the
securities laws or the other laws of any such jurisdiction. The
distribution of this announcement in other jurisdictions may be
restricted by law and the persons into whose possession this
announcement comes should inform themselves about, and observe, any
such restrictions.
The Ordinary Shares have not been and will not be registered
under the US Securities Act, and may not be offered or sold in the
United States, except pursuant to an applicable exemption from, or
in a transaction not subject to, the registration requirements of
the US Securities Act. No public offering of securities is being
made in the United States. Neither the US Securities and Exchange
Commission nor any state securities commission or other regulatory
authority in the United States has approved or disapproved of the
Ordinary Shares or passed upon or endorsed the merits of the
offering of the Ordinary Shares or the adequacy or accuracy of this
announcement. Any representation to the contrary is a criminal
offence in the United States.
No securities commission or similar authority in Canada has in
any way passed on the merits of the securities offered hereunder
and any representation to the contrary is an offence. No document
in relation to the proposed placing of the Ordinary Shares has
been, or will be, lodged with, or registered by, the Australian
Securities and Investments Commission, and no registration
statement has been, or will be, filed with the Japanese Ministry of
Finance. Accordingly, subject to certain exceptions, the Ordinary
Shares may not be, directly or indirectly, offered, sold, taken up,
delivered or transferred in or into or from any jurisdiction in
which the same would be unlawful or offered or sold to a person
within such a jurisdiction.
This announcement contains certain statements that are, or may
be, forward looking statements with respect to the financial
condition, results of operations, business achievements and/or
investment strategy of the Company. Such forward looking statements
are based on the Board's expectations of external conditions and
events, current business strategy, plans and the other objectives
of management for future operations, and estimates and projections
of the Company's financial performance. Though the Board believes
these expectations to be reasonable at the date of this
announcement, they may prove to be erroneous. Forward looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, achievements or
performance of the Group, or the industry in which the Group
operates, to be materially different from any future results,
achievements or performance expressed or implied by such forward
looking statements.
Certain figures in this announcement, including financial
information, have been subject to rounding adjustments.
Accordingly, in certain instances, the sum or percentage change of
the numbers contained in this announcement may not conform exactly
to the total figure given.
Information to Distributors
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "MiFID
II Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the Ordinary Shares have been subject to a product approval
process, which has determined that the Ordinary Shares are: (i)
compatible with an end target market of retail investors and
investors who meet the criteria of professional clients and
eligible counterparties, each as defined in MiFID II; and (ii)
eligible for distribution through all distribution channels as are
permitted by MiFID II (the "Target Market Assessment").
Notwithstanding the Target Market Assessment, distributors should
note that: the price of the Ordinary Shares may decline and
investors could lose all or part of their investment; the Ordinary
Shares offer no guaranteed income and no capital protection; and an
investment in the Ordinary Shares is compatible only with investors
who do not need a guaranteed income or capital protection, who
(either alone or in conjunction with an appropriate financial or
other adviser) are capable of evaluating the merits and risks of
such an investment and who have sufficient resources to be able to
bear any losses that may result therefrom. The Target Market
Assessment is without prejudice to the requirements of any
contractual, legal or regulatory selling restrictions in relation
to the Offer. Furthermore, it is noted that, notwithstanding the
Target Market Assessment, Arden will only procure investors who
meet the criteria of professional clients and eligible
counterparties.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take
any other action whatsoever with respect to the Ordinary
Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Ordinary Shares and determining
appropriate distribution channels.
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END
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