Blackrock and Legg Mason will each take a stake of just under 10% with Merian Chrysalis expected to take just under 20%. However the companies will not take seats on the board.
This week the Embark Group announced it had moved into profit. The parent company of Embark Platform, Vested, Rowanmoor, EBS, Hornbuckle and other businesses, made a profit of £100,000 in 2018 - reversing previous losses - on the back of a 22% increase in client numbers to 140,000. The company, which lost £1.6m the previous year, saw a 29% rise in assets under administration to £14.7bn, according to annual results for 2018.
Embark says the new investment will help it meet rising demand for its digital retirement and platform services and help it continue to be a “disruptor” in the UK investment savings sector.
The bulk of the new money is from new institutional investors BlackRock, Inc. and Legg Mason, Inc. with further investment by Merian Chrysalis Investment Company Limited.
In a statement the company said: “In addition to early stage investor New Star Investment Trust plc, the group now has a portfolio of high quality ‘cornerstone’ long-term investors.”
Embark say that existing shareholders will also support the capital raising.
Phil Smith, Embark Group chief executive, said: “The capital raising represents a significant step in our ambition, capacity and capability to be a major force in digitally led retirement and savings sector.
“Capital is central for continued steady growth but partnering with major global players who have a fully aligned vision of the future requirements across the financial advisory, direct and workplace channels, is of huge benefit.”
Sarah Melvin, BlackRock head of UK, said: “The UK retail distribution landscape is evolving rapidly, with more individuals taking greater responsibility for their financial future and retirement needs.
“This trend requires our clients to have access to high quality, technology-enabled investment solutions. Our partnership with Embark Group allows us to meet these evolving needs of our clients and their customers in this critically important UK market.”