Electra snaps up Premier

Shares in Premier Asset Management jumped by 58p, or 26.2%, to 279p as the London fund manager unveiled a £51.9m management buyout backed by Electra Investors.

The offer values Premier at 285p a share. Irrevocable undertakings have already been received from shareholders speaking for 47.5% of the capital. However, if all share options were exercised, 52% of the fully diluted capital would be in favour.

The price is 28.7% above the closing price before the offer was unveiled. The management team will put in £8.9m in equity to fund the deal, with the rest in cash.

At the end of June, Premier had £1.8bn funds under management.

Chief executive Mike O’Shea said: “This buyout gives the senior management team the freedom to ensure we can operate a dynamic strategy for the future and realise our ambitious plans for growth.”

Tim Syder of Electra Partners said: “We believe that private ownership will create the right environment for Premier to expand its assets under management and develop its business.”

He said that in an unlisted environment, Premier would also be better able “to attract and retain highly talented personnel using equity incentives” and “cope with the cyclicality of equity markets”.

Altium advised Premier and Numis fulfilled the same role for Electra.