Premier Miton’s £3.75mn takeover of Tellworth Investments is part of an ongoing acquisition strategy, also enabling the firm to gain a presence in less liquid markets, according to chief executive Mike O’Shea.
O'Shea's comments are contained within Premier Miton’s full year results, which cover the year to September 30, and revealed a 60 per cent drop in profits and outflows of around £60mn a week.
O’Shea said the current volatile markets, where most firms are experiencing outflows, means the firm is seeing more potential acquisition opportunities.
He said: "This is a feature of the market that we expect will continue for some time.
"With our strong operational and distribution platform and robust balance sheet, we are keen to take advantage of opportunities that can add talented investment teams to our portfolio or which allow us to access new markets or product capabilities.”
On the balance sheet point, the company has cash deposits of £37.9mn.
The acquisition of Tellworth occurred after the end of the accounting period covered by the results.
Tellworth was created by former Schroders UK fund managers Paul Marriage and John Warren, and had assets under management of £559mn when the takeover was announced on November 2.
The deal remains subject to change of control provisions at the FCA, and will grow Premier Miton’s assets under management by around 6 per cent.
But O’Shea said there is a reason beyond asset gathering for the purchase of the fund house, which has a large exposure to UK equities.
He said: “The acquisition broadens our offering into liquid alternatives with the addition of long/short strategies and further strengthens our existing UK equity franchise. Tellworth's institutional client base also enhances our developing presence in that market.
"The core investment team of Tellworth, including co-founders Paul Marriage and John Warren will be joining us after completion, bringing with them long track records of working in UK equities with established industry reputations and strong networks of contacts.”
Tellworth runs two long/short equity funds, both of which invest in UK small and mid caps shares.
Premier Miton's share price dropped a little over 1 per cent in the immediate aftermath of the results announcement, and is 40 per cent lower since the start of 2023.
david.thorpe@ft.com
