Ince Group has agreed to sell small-cap broking business Arden Partners (AIM:ARDN) barely more than six months after it was acquired.
The legal firm blamed the dire state of London’s small-cap market currently, with deals delayed and continued pressure on Arden’s revenues and operating margins.
Ince bought Arden for £10mln through an all-share deal that was finally completed at the end of last April but said today that the broker’s revenues had "declined significantly" from the £9.3mln recorded in the year to October 2021 and it is loss-making currently.
Zeus Group, another small-cap broker, has agreed to buy Arden for effectively nothing, with the £1mln consideration based on there being that amount of free cash in the business. There is an earn-out of up to £2mln based on future revenues.
Arden added the disposal forms part of a strategy to re-focus on its core legal services business following recent management changes.
Donnie Brown, Ince’s chief executive, added: "In challenging market and economic conditions, the disposal of Arden will allow Ince to focus its resources on its core legal business where there are increasing opportunities.”