Electra reduces stake in asset management business

The London-listed trust will retain a 48.8% stake in the company

Electra Private Equity, has agreed to sell a 25.1 percent in Premier Asset Management, an asset managing business to Elcot Capital Management.

Electra will sell its stake for £10 million (€12.6 million, $17.6 million), according to a statement.

It is understood Electra will hold a 48.8 percent stake in Premier following the sale. The transaction is subject to regulatory approval and is likely to result in an increase in Electra’s diluted NAV per share of 14p from the valuation of Premier at 31 March 2014, the trust said. 

Elcot has an option to buy up to a further 25.1 percent from Electra for up to a further £10 million for a limited period of time.

Electra declined to comment beyond the statement.

Premier is an independent asset manager focused on multi-asset, UK equity, global equity and fixed interest strategies. The business has more than £3 billion in assets under management. Electra first acquired a stake in Premier in 2007 and made a further investment in 2009.

Electra will support the company in the next stage of growth, Alex Fortescue, chief investment partner at Electra Partners, the investment manager of Electra Private Equity, said in the statement. “The business has been transformed in recent years and now has the opportunity to accelerate this growth, not only by virtue of the industry’s attractive long-term fundamentals, but also because the Premier team has invested through the recession in building a really strong platform.”

The partial exit comes after a relatively active period for Electra Private Equity – both on the exit and investment front. Between 1 April and 30 June, the trust’s realisations totalled £47 million, including £17 million received from the sale of Electra’s remaining interest in London Metric Property and a further £7 million as a result of distributions from the EP1 Secondary Portfolio, Electra said in an interim statement earlier this month.

Electra invested £124 million (€155 million, $207 million) in the period; including £81 million in Ogier Fiduciary Services, £33 million in Innovia Group and £5 million to support the acquisition of Happy Child Nurseries by Electra’s existing portfolio company Treetops Nurseries.