Wednesday, June 22, 2022
HomeFinancial PlanningAssetCo acquires fund manager SVM for £10.7m

AssetCo acquires fund manager SVM for £10.7m

Martin Gilbert’s AssetCo is to acquire Edinburgh-based fund manager SVM Asset Management for a total of £10.7m.

The deal is subject to approval by the FCA.

AssetCo said it expects the acquisition to complete by the end of September.

SVM is a fund management business with around £586m in assets under management including five open-end funds: UK Growth, UK Opportunities, Continental Europe, All Europe SRI and World Equity.

SVM also manages SVM UK Emerging Fund plc, a £6.8m investment trust listed on the London Stock Exchange.

It generated turnover of £4.3m and profit before tax of £2m for the year ended 31 December and had net assets of £14m.

SVM was founded by Colin McLean and Margaret Lawson in 1990. Both, together with a family trust, are the significant majority owners of the fund manager.

Mr McLean, who is managing director and CIO of SVM, will become a director of AssetCo’s Scottish arm on completion of the acquisition.

Ms Lawson, UK investment director at SVM, will continue in her current role managing UK equity portfolios, as will Neil Veitch, global and UK investment director, and Hugh Cuthbert, European investment manager.

Mr Gilbert, founder of Aberdeen Asset Management and chairman of AssetCo, will join the board of SVM on completion of the acquisition.

SVM’s existing 21 employees will continue to be employed by SVM.

Mr Gilbert said: “We are immensely proud to be building an asset management hub in Edinburgh that, over time, will broaden its client base across the UK and beyond. SVM is a well-regarded fund management firm, with a recognised investment style and a very strong investment track record. Its business model, people and product offering are its key assets, and it is core to AssetCo’s ambitions.

“I have known Colin and Margaret for over 30 years, and I am delighted that both have agreed to remain with SVM. Both have built phenomenal reputations as investment managers over many decades in the industry. The experience and expertise they will bring to AssetCo will be invaluable.

“I am also heartened that fund managers of the calibre of Hugh and Neil have committed to the business, as they have important roles to play. We are looking forward to working with the four of them, and the rest of the SVM team, as we develop a business to meet the evolving long-term financial needs of investors.”

AssetCo will pay a total consideration of around £10.7m. The payment will be split into an issue of up to £9m 1% fixed rate unsecured convertible loan notes in AssetCo plus around £1.7m in cash. The figures are subject to balance sheet adjustments and to be paid on completion of the acquisition.

Holders of the loan notes can convert them into fully paid ordinary shares of 10p each in AssetCo at an effective issue price of £14.50. Any unconverted loan notes will be repaid on 31 December 2023.

AssetCo said it believes that there are significant opportunities to enhance the distribution and marketing of SVM’s existing funds.

The acquisitive asset and wealth management firm added that the SVM funds will also complement the existing listed equity fund strategies offered by AssetCo’s various businesses, most notably those offered by other recent acquisition River and Mercantile Asset Management.

Following completion AssetCo will have approximately £3.5bn of AuM in listed equity fund strategies across its various businesses.



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