Premier Miton Group has approached River & Mercantile (R&M) about a merger that could create a business with more than £18bn in assets, while AssetCo has confirmed it has made an offer to the firm.Premier Miton suggested the merger after R&M confirmed it was selling one of its two divisions to shareholders for £230m.Since the London Stock Exchange opened this morning, the firm's share price has risen by 12.9%, while Premier Miton's share price has dipped by 0.7%.
The third party involved in a potential deal, AssetCo, has released a statement confirming it has submitted a "non-binding securities exchange proposal" for the firm. It said any deal would be conditional on R&M completing the sale of its solutions business.
The AssetCo statement said: "The AssetCo directors believe that RMG Asset Management and AssetCo are highly complementary and that a combination of AssetCo and RMG Asset Management would create significant value for the combined group's clients, portfolio managers, employees and shareholders. The AssetCo directors also believe that there is material value in leveraging other elements of the AssetCo business and strategy to increase the value of RMG Asset Management and widen investor appeal.
The AssetCo directors believe that RMG Asset Management and AssetCo are highly complementary and that a combination of AssetCo and RMG Asset Management would create significant value for the combined group's clients, portfolio managers, employees and shareholders."
"Whilst negotiations between RMG and AssetCo regarding the structure of a potential deal are continuing, the indicative non-binding proposal to the Board of RMG may lead to a requirement for a reverse takeover pursuant to Rule 14 of the AIM Rules.
"There can be no certainty that the Possible Offer or any offer will ultimately be made, nor as to the terms of any such offer."
In its latest results to the end of September 2021, Premier Miton's AUM had jumped 31% to reach £13.9bn, with net inflows hitting £830m for the financial year.
This was a significant turnaround with the firm having suffered £619m in net outflows in the previous financial year. The firm is made up of a merger itself after Premier and Miton recently joined forces.
