As part of the sale, Mattioli will acquire 49% of the issued share capital of Amati Global Investors with an option to acquire the remaining 51% of Amati in two years for cash and Mattioli Woods' ordinary shares. If Mattioli Woods does not exercise the option Amati Global Partners has an option to buy Mattioli Woods' shareholding back for the original sum paid.
Amati was founded in 2010 by Paul Jourdan and Douglas Lawson following the management buyout of Noble Fund Managers Limited. It focuses on small and midsized companies, ranging from listed constituents of the FTSE Mid 250 and FTSE Small Cap indices, to stocks quoted on AIM. It currently manages £120m of funds, including the TB Amati UK Smaller Companies Fund; two AIM Venture Capital Trusts Amati VCT and Amati VCT 2; and an AIM IHT portfolio service.
Amati's fund management team will remain with the business following the acquisition, which is expected to be earnings enhancing in the first full year of ownership.
In the year ended 31 December 2016, Amati generated a pre-tax profit of £0.49 million (before dividends paid to the Seller of £0.12 million) on revenues of
£1.76 million. At 31 December 2016 Amati's net assets were £1.03 million.
The deal comprises a cash consideration of £1.59 million (subject to adjustment for the value of Amati's net assets at completion), plus 224,427 new ordinary shares of 1 pence each in Mattioli Woods, which are valued at £1.74 million based on the closing price of a Mattioli Woods share on 6 February 2017, the day of completion.
Ian Mattioli, chief executive of Mattioli Woods, said: "Amati is a great fit culturally and strategically. There are few specialist UK fund managers with such a long and stable heritage, utilising the combined experience of an investment team with over 50 years' knowledge of UK smaller companies.
“The team's performance has been recognised in a number of awards and ratings. I believe this investment will significantly enhance the group's fund management expertise."
Dr Paul Jourdan, Amati's chief executive officer, added: "As AIM investors we have known and admired Mattioli Woods for many years. We are very much looking forwards to working closely with them, and believe that as a result we will be able to take our specialist investment products to a much wider audience."
- Mattioli also released interim results today and reported profit before tax was up 28.6% to £3.6m