Tavistock rockets higher on sale of fund management arm

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Tavistock Investments PLC (LON:TAVI) shot higher as it agreed to sell its fund management arm (TWL) for up to GBP40mln to Titan Wealth.


The fund group will receive additional payments over a ten-year period equivalent in value to 50% of future net income on any increased funds under its ACUMEN brand.


As part of the deal, Tavistock will also become Titan’s strategic partner and distribute its products.


John Leiper, Tavistock’s Chief Investment Officer, and his investment team will continue to work closely with Tavistock and its advisers.


In its audited accounts for the year ended 31 March 2020, TWL reported a pre-tax profit of GBP2.3 million from gross revenues of GBP5.6 million and gross assets of GBP5.2 million.


Simultaneously, Titan is also negotiating to buy Global Prime Partners, an institutional platform services with GBP2bn in assets under administration.


Tavistock recently saw off an all-share bid approach from AIM-listed TEAM that valued the group at 2.43p per share.


In its statement today, Tavistock said the sales of TWL to Titan was worth an equivalent 6.58p per share.


Brian Raven, Tavistock’s Chief Executive, said: “This is a great opportunity for both companies. Whilst Tavistock Wealth is becoming part of Titan, we will still be working closely with our highly successful investment team. The partnership with Titan endorses our corporate strategy and will enable us to accelerate the growth of our business and deliver maximum value to our shareholders.”


Tavistock has received irrevocable undertakings to vote in favour of the TWL sale from 50.56% of shareholders.

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