Deals



Acquisition of European Wealth Management Group Limited


Posted: 17th April 2014 08:39

The Company is pleased to announce the conditional acquisition of all of the issued shares in European Wealth Management Group Limited ("EWMG").
 
Key Highlights
 
 - Based on the Theoretical Post Consolidation Price, the Acquisition values EWMG at approximately £13.45 million with the value of the Total Consideration being approximately £7.1 million.
 
 - The Total Consideration is to be satisfied through the issue of 2,611,084 New Ordinary Shares (amounting to approximately £1.88 million at the Theoretical Post Consolidation Price) and the issue of £5,218,420 nominal of convertible loan stock ("CLS")
 
 - Since the original EWG investment in April 2012, the EWMG Group has grown its aggregated funds under management and influence from approximately £0.15 billion to over £0.71 billion today, this represents an increase of nearly five fold over the period.
 
 - The EWMG Group's client base currently ranges from individuals with up to £7 million of assets to invest to institutions investing up to £68 million.
 
 - EWMG has identified a number of potential acquisition targets and intends to pursue further growth opportunities through strategic acquisitions funded by a mixture of equity and debt, although no specific proposals have extended beyond preliminary discussions.
 
Commenting on the Acquisition, Paul Everitt, executive director of EW Group, commented:

"EWMG has grown significantly since we first invested in it in April 2012, with funds under management and influence increasing approximately six fold to approximately £0.7 billion.  We believe that significant opportunities for growth, both organic and acquisitive, exist within the wealth management industry however the current arrangement, with EWMG being 48.8% owned by EWG and with EWMG Shareholders holding a further 39% of EWG, does not provide an efficient structure through which to raise growth capital.  The Directors' opinion is that for EWMG to fully exploit the opportunities for growth, both organically and by acquisition, within the wealth management industry then the ownership of EWG and EWMG need to be consolidated in order to provide clarity to current and future investors. We look forward to the business continuing to deliver value back to our shareholders."
 
John Morton, Executive Chairman of European Wealth Management Group, said

"This is an important moment in European Wealth's development. Not only will it allow us to continue growing the range services we deliver to our clients - it will allow us to pursue those opportunities that continue to flow from RDR as well as those now being generated as a result of the Chancellor's recently proposed changes to the pension industry."

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