Acquisition of Essential Fund Services, LLC

16 December 2021

JTC PLC

(the "Company" and together with its subsidiaries "JTC" or the "Group")

Acquisition of Essential Fund Services, LLC ("EFS")

A bolt-on US fund services business with long established commercial links to the recently acquired SALI Fund Services business that adds further scale in a key growth market

JTC, the global professional services business, is pleased to announce the acquisition of Essential Fund Services ("EFS"), headquartered in New York, USA. EFS offers a broad range of services in the alternative assets space, including accounting, reporting and administrative services to investment partnerships and their investment managers. The consideration will be settled via cash and JTC equity.

Background to EFS

EFS was co-founded in 2009 by the present Managing Member and sole owner, Gerard M. Federici, who is a highly respected financial services professional with over 25 years' industry experience.

EFS differentiates itself from competitors by providing a high level of service to its investment manager clients, allowing them to focus more closely on the investment process, knowing that critical administrative functions are in the hands of skilled and experienced professionals.

Gerard Federici will continue to lead the business and all current EFS employees will join JTC, becoming part of the Group's Institutional Client Services (ICS) Division. The transaction is not subject to any regulatory approvals and completes with immediate effect.

Strategic rationale

The acquisition of EFS is extremely complementary to JTC's recent acquisition of SALI Fund Services. EFS is one of the leading independent providers of fund accounting services to the Insurance Dedicated Fund ("IDF") market, where SALI is the established market leader. Significant strategic benefits are anticipated for both businesses as they become part of the same Group, with the transaction enabling greater collaboration between the firms and a more integrated offering for IDF clients more generally.

More broadly, EFS will enhance JTC's fund services presence in the US, providing additional scale and growth opportunities that complement the Company's expanding US footprint. EFS currently provides services to 45 clients across 110 investment partnerships and has approximately $5.5bn of Assets under Administration ("AuA"). The wider client book, which is primarily located in the Greater New York Region, provides further diversity to JTC's ICS client base in the US and over time, these clients will have the opportunity to benefit from the Group's global capabilities and offering.

The US is an important growth market for fund services, including alternative asset classes. The prevalence of outsourcing for fund services is lower than levels seen in Europe, offering opportunities for strong growth. EFS, with its reputation for exceptional levels of client service, is well positioned to capture new business with the backing of JTC's global platform and capabilities.

Financial Benefits 

In the financial year ending 31 December 2020, EFS delivered revenue of c. $1.7m with an EBITDA margin in line with JTC's medium term guidance of 33% - 38%. The business has grown consistently over time and there are tangible opportunities to accelerate the growth trajectory by capturing a greater share of the IDF fund accounting market and through leveraging JTC's network and capabilities, both in the US and internationally.

Nigel Le Quesne, CEO of JTC, said:

"The acquisition of EFS is another high quality addition to our strategically important and fast-growing US business. Gerard and his team have a demonstrable track record of delivering the highest levels of client service and the existing relationship with SALI Fund Services will help to enable further growth for both businesses as part of the Group. We are excited about the future for EFS and extend a warm to welcome Gerard, his team and all of the business' clients and partners."

Gerard M. Federici, Managing Member of EFS, said:

"I am delighted that EFS has the opportunity to become part of the JTC Group and play a role in its ambitious plans for the US fund services market. We share the same belief in the importance of exceptional client service and through our established relationship with SALI Fund Services, we will very much hit the ground running and look forward to accelerating our growth story."

Issue of Equity and Voting Rights

Applications have been made to the Financial Conduct Authority ("FCA") and London Stock Exchange plc (the "London Stock Exchange"), respectively, for 84,619 new ordinary shares of £0.01 each in the capital of the Company (the "Shares"), being the share consideration due under the terms of the Securities Purchase Agreement dated 15 December 2021 pursuant to which the Company has acquired EFS, to be admitted to the premium listing segment of the Official List of the FCA and to trading on the main market of the London Stock Exchange ("Admission"). It is expected that Admission will become effective and dealings in the Shares will commence at 8.00am on 21 December 2021.

Following admission of the New Shares the Company will have 147,585,261 Ordinary Shares of £0.01 each in issue. There are no shares held in treasury. Therefore, following admission of the New Shares the total number of voting rights in the Company will be 147,585,261 (the "Voting Rights Figure"), and this Voting Rights Figure may be used by Shareholders as the denominator for the calculations by which they will determine if they are required to notify their voting rights interest, or a change to that interest, in the Company under the FCA's Disclosure Guidance and Transparency Rules.

Ends.

Enquiries:

JTC PLC                                                                       +44 (0) 1534 700 000

Nigel Le Quesne, Chief Executive Officer             

Martin Fotheringham, Chief Financial Officer

David Vieira, Chief Communications Officer

Camarco                                                                      +44 (0) 20 3757 4985

Geoffrey Pelham-Lane                                                   

Monique Perks

Emily Shea-Simonds

About JTC

JTC is a publicly listed, global professional services business with deep expertise in fund, corporate and private client services. Every JTC person is an owner of the business and this fundamental part of our culture aligns us with the best interests of all of our stakeholders. Our purpose is to maximise potential and our success is built on service excellence, long-term relationships and technology capabilities that drive efficiency and add value. 

www.jtcgroup.com

Important Notices

The person arranging release of this announcement on behalf of JTC is David Vieira (Chief Communications Officer).

The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any other jurisdiction should inform themselves about, and observe, any applicable requirements. This announcement has been prepared for the purposes of complying with the Listing Rules and MAR and the information disclosed may not be the same as that which would have been prepared in accordance with the laws and regulation of any jurisdiction outside of England.

This announcement contains forward looking statements. No forward-looking statement is a guarantee of future performance and actual results or performance or other financial condition could differ materially from those contained in the forward-looking statements. These forward-looking statements can be identified by the fact they do not relate only to historical or current facts. They may contain words such as "may", "will", "seek", "continue", "aim", "anticipate", "target", "projected", "expect", "estimate", "intend", "plan", "goal", "believe", "achieve" or other words with similar meaning. By their nature forward looking statements involve risk and uncertainty because they relate to future events and circumstances. A number of these influences and factors are outside of the Company's control. As a result, actual results may differ materially from the plans, goals and expectations contained in this announcement. Any forward-looking statements made in this announcement speak only as of the date they are made. Except as required by the FCA or any applicable law or regulation, the Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this announcement.