The bidding war for boutique asset manager River & Mercantile has come to end after Premier Miton Group removed itself from contention, leaving City veteran Martin Gilbert’s AssetCo as the remaining suitor for the firm.
Having announced it was considering a bid for R&M in November, Premier Miton ended speculation of a takeover on Thursday as it informed investors it has ‘withdrawn from discussions’.
In a statement, R&M said ‘discussions remain ongoing’ with AssetCo, which doubled its stake in the firm last year, but cautioned ‘there can be no certainty that a firm offer will be made’.
Martin Gilbert’s (pictured) AssetCo is now the only firm in contention to launch a takeover of River & Mercantile
Mike O’Shea, chief executive of Premier Miton, explained that his firm had found ‘insufficient commercial merits for our shareholders to make a formal proposal for the acquisition’ of R&M.
However, he did not rule out future merger and acquisition activity, adding that Premier Miton would be ‘exploring tactical and strategic opportunities that can further strengthen our business and accelerate our growth’.
Mr Gilbert’s takeover vehicle AssetCo will now have until 5pm on 18 January to make a firm offer for R&M after the deadline for the potential deal was extended in late December.
AssetCo secured three acquisitions last year – including the takeover of Edinburgh investment house Saracen Fund Managers – and raised £25million from investors.
Asset managers are bulking-up to fight off rivals running cheaper passive, or index-tracking, funds.
Mr Gilbert, a 66-year-old father of three, is both chairman of Asset Co and deputy chairman of R&M.
He is also chairman of Revolut, Toscafund and Scottish Golf, and senior non-executive director at Glencore.
Mr Gilbert has recused himself from the R&M board for the purposes of talks relating to the potential bid.
The latest swoop comes nearly four decades after Mr Gilbert set up Aberdeen Asset Management.
He built it into a giant with more than £300billion of savings on its books before merging it with Standard Life in 2017.
He stepped down in 2019 and took control of stock market-listed cash shell AssetCo.
AssetCo, which currently holds five million R&M shares, representing approximately 5.85 per cent of its voting rights, has previously said the two companies ‘are highly complementary’ and a combination of the pair ‘would create significant value for the combined group’s clients, portfolio managers, employees and shareholders’.
For its part, R&M’s board said on Thursday it was focused on completing the sale of its solutions business to Schroders, implementing the planned return of £180million to shareholders and ‘developing…into a specialist asset manager’.
It added: ‘The board has committed to providing shareholders with a broad update on its post-sale strategic plan in the Spring.’
