Amendment to Investment Management Agreement

RNS Number : 9393G

Mattioli Woods PLC

02 June 2017

 

2 June 2017

Mattioli Woods plc

("Mattioli Woods", "the Company" or "the Group")

Amendment to Custodian Capital Limited Investment Management Agreement

Mattioli Woods plc (AIM: MTW.L), the specialist wealth management and employee benefits business, announces that the terms of the Investment Management Agreement ("IMA") between its subsidiary, Custodian Capital Limited ("CCL"), and Custodian REIT plc ("Custodian REIT") have been amended following expiry of the IMA's initial three year term.

In light of the positive performance of Custodian REIT since its admission to trading on the London Stock Exchange in 2014 ("Admission"), the Company has agreed a further three year term with 12 months' notice to CCL's ongoing engagement as external discretionary fund manager from 1 June 2017.  Fees payable to CCL under the IMA have been amended to include:

·     A step down in the property management fee from 0.75% to 0.65% of net asset value ("NAV") applied to NAV in excess of £500 million; and

·     A step down in the administrative fee from 0.125% to 0.08% of NAV applied to NAV between £200 million and £500 million and a further step down to 0.05% of NAV applied to NAV in excess of £500 million.

All other key terms of the IMA remain unchanged.

The Board considers these amendments to the IMA to be in the best interests of the Company's shareholders because:

·     Another three year term provides CCL with security of tenure and allows further investment in the dedicated systems and people providing its services under the IMA; and

·     Fee changes will be beneficial to clients of the Company who are investors in Custodian REIT, particularly where NAV exceeds £500 million, by reducing Custodian REIT's ongoing charges ratio and increasing its dividend capacity.

Ian Mattioli, Chief Executive of the Company and Non-Executive Director of Custodian REIT, commented:

"The Board of Custodian REIT has been delighted with the performance of CCL as Investment Manager since Admission, particularly CCL's ability to deploy new monies on a timely basis on high quality assets, securing the earnings required to fully cover Custodian REIT's target dividends.  The revised IMA terms secure both an immediate cost reduction for our clients who are invested in Custodian REIT and an important long-term revenue stream for the Group."

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For further information please contact:

Mattioli Woods plc
Ian Mattioli MBE, Chief Executive
Nathan Imlach, Chief Financial Officer	Tel: [phone]
	www.mattioliwoods.com
Canaccord Genuity Limited
Sunil Duggal, Investment Banking	Tel: [phone]
Andrew Buchanan, Corporate Broking
	www.canaccordgenuity.com

Media enquiries:

Camarco
Ed Gascoigne-Pees	Tel: [phone]
	www.camarco.com

 

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