| CATEGORY: NEWS AND ANNOUNCEMENTS SECTOR: FINANCIAL SERVICES |
Rensburg unveils £188m Carr merger |
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Wed 23 Mar 2005
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LONDON (SHARECAST) - Rensburg has agreed terms for a £188m merger with Investec subsidiary Carr Sheppards, again snubbing a bid approach from rival fund manager Rathbones.
The new group, Rensburg Sheppard, will became the seventh largest private client fund manager with £10.3bn funds under management.
Rensburg will pay for the deal by giving Investec a £60m subordinated loan and by issuing 25.5m new shares. Investec will transfer 2.8m of its consideration shares to an employee benefit trust, for key Carr Sheppards Crosthwaite employees.
The move is effectively a reverse takeover with Investec owning 47.7% of the new group, current Rensburg shareholders will have 46.4% and Carr Sheppards employees will own the remaining 5.9%.
"This combination is a unique opportunity to create one of the leading private client wealth management groups extending our franchise throughout the UK," said Rensburg chief executive Michael Burns.
As part of the acquisition terms, Rensburg shareholders will be entitled to a special dividend of 54p per existing ordinary share.
Rensburg rejected a takeover bid from Rathbone Brothers in February but Rathbones are still interested in a takeover bid.
"Rathbones continues to believe that compelling strategic, operational and commercial reasons for a combination of Rathbones and Rensburg exist," said Rathbone.
"The board of Rathbones continues to review its options in respect of Rensburg and encourages Rensburg shareholders to take no action in respect of the proposed Carr Sheppards Crosthwaite transaction."
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