Acquisition

RNS Number : 7766Q

Caledonia Investments PLC

22 June 2015

 



 

CALEDONIA INVESTMENTS AGREES TO ACQUIRE SEVEN INVESTMENT MANAGEMENT

Caledonia Investments plc ("Caledonia") is pleased to announce that it has agreed to acquire a majority stake in Seven Investment Management ("7IM"), the provider of discretionary fund management, retail investment funds and platform services to UK investors, in a transaction which values the business at £100m.

7IM was established in 2002 by its co-founders, Chief Executive Officer, Tom Sheridan, and Head of Corporate Development, Justin Urquhart Stewart, along with their Chief Finance Officer, Charles Sparrow, and has grown from its seven founder members to a team of more than 190 people. At 30 April 2015, it had assets under management and administration of approximately £9.5bn.

Dependent on the date of completion, which is subject to the Financial Conduct Authority's approval, Caledonia will invest up to £77m in cash to acquire approximately 94% of 7IM Holdings Ltd ("7IM Holdings"), the controlling member of Seven Investment Management LLP which operates the 7IM business, from its current owners, Allied Zurich Holdings Ltd and Aegon UK plc. 7IM's management team will subscribe £5.0m for the remaining equity, with the balance of the purchase costs to be provided by £25m of bank debt, which Caledonia has agreed to underwrite in the event that this is not in place by completion.

For its financial year to 31 December 2014, 7IM Holdings reported profit before tax of £8.6m and gross assets of £42.9m.

Commenting on the acquisition, Duncan Johnson, Caledonia's Head of Unquoted Investments, said:

"Caledonia has a long history of investing in successful fund management businesses. We look forward to supporting Tom Sheridan and his team in building on 7IM's impressive growth record and strong investment performance to service an expanding UK wealth management market where there is a growing demand for multi-asset and multi-manager funds."

Tom Sheridan, 7IM's Chief Executive, commented:

"We are delighted to be partnering with Caledonia in the next phase of 7IM's development. Their investment philosophy and culture, as well as their attitude to longer term investment, are perfectly aligned with our own. This will enable us to continue our focus on, and development of, "doing the right thing" in our business, for not just our partners and staff, but of course most importantly our clients.

My colleagues are also pleased to have the opportunity to be providing further investment into the business alongside Caledonia. We have many exciting developments and ideas for our clients, 7IM and our industry, and having Caledonia as a partner will greatly help us in achieving some very exciting goals."

22 June 2015

For further information contact:

Caledonia Investments plc	[phone]
Will Wyatt, Chief Executive Stephen King, Finance Director
Duncan Johnson, Head of Unquoted Investments
Media contact:
Tulchan Communications	[phone]
Peter Hewer

END

Notes for editors:

Caledonia Investments plc

Caledonia is a self-managed investment trust company listed on the London Stock Exchange with net assets of approximately £1.6bn. The company maintains a concentrated portfolio of international quoted, unquoted and fund investments and has paid an increasing annual dividend for 48 years.

In the unquoted arena, Caledonia seeks to invest £25m to £100m in private companies, either on a majority or minority basis, providing a meaningful presence and growth capital supporting double-digit operating margins. Its current unquoted portfolio includes Park Holidays (a UK caravan parks operator), Cobehold (a European unquoted investment house), TGE Marine (a marine gas-engineering business based in Germany), The Sloane Club (a London residential club) and Choice Care Group (a UK learning disability care homes provider).

For additional information on Caledonia, please visit www.caledonia.com.

7IM

7IM was founded in 2002 by its current management team and specialises in multi-asset risk-rated investment, which it offers through discretionary fund management, asset management and self-invest services. At 30 April 2015, 7IM had assets under management and administration of approximately £9.5bn.

For additional information on 7IM, please visit www.7im.co.uk. 

Transaction

Caledonia's investment in 7IM was led by Charlie Edwards, Duncan Johnson, Tim Lewis and Tarquin Wethered.

Macfarlanes (Stephen Drewitt) and N M Rothschild & Sons (Ed Griffin) respectively acted as legal and financial advisers to Caledonia. PricewaterhouseCoopers (Fredrik Johansson) provided commercial due diligence advice and Deloitte (Tim Haden) provided tax advice. KPMG (James Woolf) provided financial due diligence services.

Evercore (Ollie Clayton) and Clifford Chance (Alex Erasmus) respectively provided corporate finance and legal advice to Allied Zurich Holdings Ltd and Aegon UK plc.

Squire Patton Boggs (Nick Allen) provided legal advice to 7IM's management team.

Neither the contents of Caledonia's nor 7IM's websites, nor the contents of any website accessible from hyperlinks on these websites (or any other website) is incorporated into, or forms part of, this announcement.

 

END

 

 

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