28th Jul 2015 08:58
LONDON (Alliance News) - Porta Communications PLC on Tuesday said it has acquired a 29.5% stake in a newly formed company that has acquired Broker Profile Ltd, an investor relations consultant to London-listed companies.
"We believe the combination of investor access together with investor relations and financial public relations will be valuable services to offer to clients and will broaden Porta Group's service offering to its existing clients," Porta Chief Executive David Wright said in a statement.
According to Broker Profile, it has been acquired by Capital Access Group Ltd, a company founded by former Seymour Price stockbrokers Richard Feigen and Kevin Lapwood. Jonathan Gillen, the founder of Broker Profile, will take on a consultancy role and assist with the handover to Feigen and Lapwood, who will lead the business with current Managing Director Simon Courtenay.
Porta will provide Capital Access with some office services for the next three and a half years. It also will guarantee up to GBP2 million of debt, comprised of GBP1 million of the debt raised by Capital Access and GBP1 million of seller loan notes issued to fund the acquisition of Broker Profile.
Porta said it has made agreements to protect itself as a minority shareholder. It will be granted a call option to buy the remaining shares in Capital Access in the future. The call option can be exercised in four tranches following the end of 2017. Porta said it would use shares to make any additional payment under the call option.
"Porta has no obligation to purchase the remaining equity of Capital Access or to fund Capital Access or Broker Profile in the future," the company said.
Feigen, the new chief executive of Broker Profile, said he had admired the company for a long time.
"We intend to build upon what Broker Profile has achieved already and increase the scale of the company and the quality of the advice that it gives to its clients," Feigen said in a statement.
Broker Profile is moving to the Sky Light City Tower on Basinghall Street in London.
It made a pretax profit of about GBP800,000 in 2013 on revenue of GBP2.7 million.
Capital Access paid GBP4 million for Broker Profile, plus surplus cash relating to working capital.
Shares in Porta were down 0.8% at 9.18 pence on Tuesday morning in London.
By Samuel Agini; [email protected]; @samuelagini
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