Regal to buy $2.9b manager Merricks Capital
Make us a preferred source
Make us a preferred source on Google
The news: Regal Partners has entered into an agreement to fully acquire Merricks Capital via its parent JRJJ.
The numbers: Merricks is a $2.9 billion manager in private credit and alternative investments, specialising in hard assets across agriculture, infrastructure, commercial and industrial property.
Regal will pay $235 million, the equivalent of 6.5 normalised EBITDA, for the fund manager. Of that, $40 million will be in cash with the remainder to be made up by the issue of almost 64 million Regal shares at a price of $3.05 per share.
It will also issue almost 11 million options to current Merricks employees. The exercise of the options will be subject to specific net profit before tax targets.
The context: It will increase Regal's AUM by 24% to $15.1 billion and marks the latest acquisition by Regal as the fund manager run by Phil King looks to grow and diversify.
In November, Regal acquired long/short manager PM Capital. It has also taken a 50% position in Taurus Funds Management, a mining finance provider.
It failed to acquire Pacific Current Group last year after competition from GQG Partners but has publicly stated it continues to "monitor a range of opportunities to add additional scale or expertise to the business".
The source: ASX announcement
