logo-loader
viewShare PLC

Share Centre owner agrees £62mln merger with Interactive Investor

Investors in Share PLC will receive 41p in a combination of cash and stock for each share they hold

Share plc - Share agrees £62mln merger with Interactive Investor

Share plc (LON:SHRE), the owner of The Share Centre, has agreed to a £61.9mln takeover offer from rival platform, Interactive Investor.

Under the deal terms, Share investors will receive 41p in a combination of cash and stock for each share they hold - a 41% premium to the firm’s closing price of 29p last Friday.

READ: Share swings to profit in first half but stays cautious as Brexit looms large over investor sentiment

In a statement, Share said there was a “strong strategic rationale” for the combination, as consumer share trading platforms required “scale to sustain the level of profitability necessary for significant and ongoing technology investment in customer experience and services”.

The company also said its board will be recommending the offer to shareholders unanimously at a general meeting to approve the takeover.

Share has already received backing from investors representing 70.2% of its share capital, with the merger now expected to complete in the third quarter of 2020.

"I am delighted to welcome this combination of our businesses, designed to transform the prospects for individual share ownership and personal investment across the United Kingdom”, said Share’s executive chairman Gavin Oldham.

Meanwhile, Interactive Investor chief executive Richard Wilson said the combination “brings further scale and the opportunity to deliver enhanced value, service and customer experience to an enlarged customer base”.

Share plc stock was 13.8% higher at 33p in afternoon trading, albeit 24% below Interactive’s offer price.

Consistent with ii's growth strategy

Andrew Boyle, CEO of corporate finance firm LGB & Co said: “Interactive Investor’s decision to purchase The Share Centre is consistent with the company’s growth strategy, which was illustrated by its acquisition of Alliance Trust Savings in 2019, creating a platform with assets under administration of £36 billion and a customer base of 400,000.”

He added: “In this sector, scale is necessary to offset increasing costs of technology, marketing and regulation. The acquisition of The Share Centre will add a further £5bn in assets and around 275,000 customer accounts to the ii portfolio, as well as bring 250 employees who have developed the company’s reputation for reliable customer service.”

Boyle continued: “The deal values Share plc at a 41% premium to the last closing price of 29p. However, as 90% of the consideration comes in shares of an unquoted vehicle, the share price is up by just 14% to 33p today.

“We may be seeing investors requiring liquidity exiting at this point.  However, JC Flowers, who are the majority owner of ii, have a longstanding reputation for expertise in financial sector private equity investing and so the acquisition may be an attractive proposition for investors able to take a longer-term view.”

 -- Adds comment, updates share price --

Quick facts: Share PLC

Price: 29 GBX

AIM:SHRE
Market: AIM
Market Cap: £41.66 m
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Enthusiasm of Belvoir Group franchisees during crisis has been incredible...

Dorian Gonsalves, chief executive of Belvoir Group PLC, says the company’s franchisees will be ready to go straight out and start letting again as soon as the lockdown is lifted. Belvoir is actively transacting business on all sides except estate agency, where transactions have all but...

13 hours, 32 minutes ago

3 min read