Braveheart Investment Closes Sale of Viking Fund Managers.
22 April 2019 - UK-based fund management and strategic investor group Braveheart Investment Group plc (AIM: BRH) has closed the sale of the entire issued ordinary share capital of its subsidiary company, Viking Fund Managers Ltd., the group said.
The consideration paid consists of a payment of GBP 110,000 in cash, and an additional payment, estimated to be approximately GBP 170,500, due to be paid in cash once the performance fee of an existing fund management contract has been agreed with the client in early 2020.
Furthermore, cash held by Viking at the date of completion, which totalled GBP72,000, was not included in the sale and has now been transferred to Braveheart and the intercompany loans payable by Braveheart, Strathtay Ventures Ltd. (another subsidiary of Braveheart) and Ridings Early Growth Investment company Ltd. (another subsidiary of Braveheart) to Viking, amounting to approximately GBP 650,000, were forgiven immediately prior to completion of the sale.
Not included within the sale are Ridings Holdings Ltd. and it's wholly owned subsidiary REGIC. The entire issued share capital of RHL was transferred to Braveheart before the date of completion.
In the year ended 31 March 2018, Viking achieved a profit before tax of GBP 404,388 on revenues of GBP 715,523.
However, due to the declining fees that are being generated from existing contracts, the unaudited revenue of Viking for the year ended 31 March 2019 is estimated to be approximately GBP 478,000 and the unaudited profit for the same period is estimated to be approximately GBP 75,000.
If no new contracts were entered into by Viking, the revenues for the year ending 31 March 2020 are expected to be significantly lower as the management contract for the Finance Yorkshire Equity Fund expires on 31 December 2019, as has been previously disclosed.
As at 31 March 2018, Viking had audited net assets of GBP 794,474, including intercompany loan balances of GBP457,171 due from Braveheart, Strathtay and REGIC, investments in RHL and REGIC of GBP 45,000, an accrual for the Performance Fee of GBP 174,939 and cash of GBP 42,541.
None of these assets are included as part of the sale of Viking.
It is proposed to use the sale proceeds from the sale of Viking for working capital purposes generally.
Despite the disposal of Viking, the directors confirm that they intend to actively continue to run the fund management business and will continue to tender for opportunities as and when they arise.
The purchasers of Viking are Jonathan Freeman, Ian Brown and James Bromhead. Jonathan Freeman is a Non-Executive director of Braveheart and a director of Viking and, therefore, the transaction is treated as a related party transaction under the AIM Rules. Ian Brown is currently a consultant to Viking.
Sector: Banking/Financial Services
Target: Viking Fund Managers
Vendor: Braveheart Investment
Deal size in USD: .364m
Buyer advisor: , ,
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|Publication:||M & A Navigator|
|Date:||Apr 22, 2019|
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