AssetCo acquires Edinburgh-based Saracen Fund Managers Limited in £2.75m deal

Graham Campbell

Asset & wealth management firm Asset Co has announced its conditional acquisition of Edinburgh-based Saracen Fund Managers Limited for an effective total consideration of £2.75 million.

The Consideration will be satisfied by the issue of 166,904 new ordinary shares of 10p each in the company, fully paid and £664,774 in cash, in each case to be paid on completion.

Saracen is an independent, FCA regulated, fund management business based in Edinburgh that was founded in the late 1990s. Saracen has three funds, operating on the T Bailey Fund Services Limited platform, called Global Income and Growth Fund (approximately £103m of Assets under Management (AuM)), UK Alpha Fund (approximately £14m of AuM), and UK Income Fund (approximately £2m of AuM).

Saracen operates from an office in Rutland Square, Edinburgh, and has five full time employees, all of whom will enter new employment contracts on completion.

Saracen generated turnover of £985,364 and a loss after taxation of £15,146 for the financial year ended 31 March 2020 and had net assets of £400,661, as at 31 March 2020.

Following completion of the Acquisition, Saracen will continue to operate from Edinburgh under the Saracen brand. Martin Gilbert and Peter McKellar, directors of AssetCo, will join the board of Saracen on completion.

Peter McKellar, deputy chairman and CEO of AssetCo, commented: “Saracen is a small fund management firm with great potential. Its business model, people and product offering are its key assets and are an ideal fit for AssetCo. I’m looking forward to working with Graham and the team. Our focus will be on building on Saracen’s strong foundations, particularly the experience and expertise of its management team and their investment approach. We aim to grow the business through marketing its existing funds and over time broadening its product range to continue to meet the needs of customers.

“The proposed acquisition is part of AssetCo’s overall strategy of acquiring and investing in asset and wealth management businesses. The industry is contending with multiple structural shifts, including demographics, fee compression and a greater focus on ESG. These are presenting challenges and opportunities for incumbent firms and we believe we can capitalise on this to help unlock value and to deliver for clients and investors.”

Graham Campbell, CEO of Saracen, said: “We’ve known Martin and Peter for some time and are excited about working with them to help grow Saracen’s three existing funds and to develop the overall business. Importantly the investment philosophy and team will remain the same.

“We believe our focus on active management and fundamental research with a long-term mindset is well placed to help investors achieve their financial goals. Our clients are supportive of this approach and we are now focused on introducing our funds to a wider range of prospective investors.”

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