20th Dec 2016 17:40
LONDON (Alliance News) - Arbuthnot Banking Group PLC said Tuesday it has agreed to acquire Renaissance Asset Finance Ltd.
Arbuthnot said its wholly-owned subsidiary Arbuthnot Latham will acquire Renaissance, which provides finance for specialist assets including vintage cars, for an initial consideration equal to its net assets at the time of completion, plus performance-based payments of up to GBP6.5 million.
Brentwood-based Renaissance's net assets at November 30 stood at GBP1.6 million, while its total customer assets stood at GBP68.0 million. The deal is expected to complete early in the second quarter of 2017.
Arbuthnot said the performance based payments will be made annually, based on the profitability of Renaissance's business in each of the three years following completion.
Both the consideration and refinancing of Renaissance's approximately GBP66.0 million funding liabilities will be satisfied from Arbuthnot's current cash resources.
For its financial year ended June 30, Renaissance made a pretax profit of GBP2.4 million, including one-off income of GBP1.8 million, said Arbuthnot.
"Following the transformational deals completed by ABG earlier this year, I am delighted that Arbuthnot Latham, with the support of ABG can further develop its expansion and diversification plans. The acquisition of RAF will fit well alongside our growing Private and Commercial banking units and I welcome the team from RAF into the group," said Ian Henderson, chief executive of Arbuthnot Latham.
Shares in Arbuthnot Banking Group closed down 1.5% at 1,410.00 pence Tuesday.
By Adam Clark; [email protected]
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