Gilbert’s AssetCo buys Saracen Fund Managers

Martin Gilbert

Martin Gilbert’s investment vehicle AssetCo plc announced it agreed to acquire Edinburgh-based Saracen Fund Managers Limited for £2.75 million in shares and cash.

“The acquisition is conditional on, inter alia, approval by the FCA to the change of controller and the admission of the consideration shares to trading on AIM, which is expected to occur by the end of September 2021,” said AssetCo.

Saracen’s CEO is another fund management industry veteran, Graham Campbell.

In April, AssetCo shareholders approved its plans to appoint Gilbert as chairman and change its business strategy to the development “of an asset and wealth management business.”

AssetCo shareholders last month also approved the appointment of Peter McKellar as chief executive and deputy chairman.

Gilbert is former co-CEO of Standard Life Aberdeen (SLA) and McKellar is former global head of private markets at SLA.

On March 26, AssetCo said it planned to raise cash “to execute the new strategy of making strategic acquisitions.”

AssetCo said on Friday: “Saracen has three funds, operating on the T Bailey Fund Services Limited platform, called Global Income and Growth Fund (approximately £103 million of Assets under Management (AuM)), UK Alpha Fund (approximately £14 million of AuM), and UK Income Fund (approximately £2 million of AuM).”

Saracen will continue to operate from Rutland Square in Edinburgh under the Saracen brand.

Gilbert and McKellar will join the Saracen board on completion.

“The board of the company believes that there exist significant opportunities to enhance the distribution and appeal of Saracen’s existing funds and to widen the funds offered by Saracen to include immediate adjacencies,” said AssetCo.

“Finally, Saracen offers the company the opportunity to acquire a FCA regulated entity and the associated authorisations, subject to FCA change in controller approval.”

McKellar said: “Saracen is a small fund management firm with great potential.

“Its business model, people and product offering are its key assets and are an ideal fit for AssetCo.

“I’m looking forward to working with Graham and the team.

“Our focus will be on building on Saracen’s strong foundations, particularly the experience and expertise of its management team and their investment approach.

“We aim to grow the business through marketing its existing funds and over time broadening its product range to continue to meet the needs of customers.

“The proposed acquisition is part of AssetCo’s overall strategy of acquiring and investing in asset and wealth management businesses.

“The industry is contending with multiple structural shifts, including demographics, fee compression and a greater focus on ESG.

“These are presenting challenges and opportunities for incumbent firms and we believe we can capitalise on this to help unlock value and to deliver for clients and investors.”

Saracen CEO Graham Campbell said: “We’ve known Martin and Peter for some time and are excited about working with them to help grow Saracen’s three existing funds and to develop the overall business.

“Importantly the investment philosophy and team will remain the same.

“We believe our focus on active management and fundamental research with a long-term mindset is well placed to help investors achieve their financial goals.

“Our clients are supportive of this approach and we are now focused on introducing our funds to a wider range of prospective investors.”

Saracen is an independent, FCA regulated, fund management business based in Edinburgh that was founded in the late 1990s.

AssetCo said the acquisition will be satisfied by the issue of 166,904 new ordinary shares and £664,774 in cash, in each case to be paid on completion.