The company raised a total of £17.5 million through the issue of 7m new ordinary shares at 250p per share. The company said it increased the size of the placing from £15 million to £17.5 million to “satisfy excess demand received from new and existing investors.”
The money will be used to help the company complete its acquisition pipeline and for “working capital” purposes. The company says it has a strong pipeline of potential acquisitions under negotiation.
AFH chief executive Alan Hudson welcomed the “resounding vote of confidence” in the group.
He said: “All our current institutional investors have increased their stakes in the group, and we picked up a number of major new institutional investors with this issue.”
“Following on the success of our last issue, we see this as demonstrating continuing confidence in the company and an endorsement of its strategy.”
AFH says the money will give AFH a £20m+ war chest to continue its twin-track expansion strategy of merging with other companies and continuing to grow its client base through its team of 165 financial advisers, who cover the whole of the UK.
“Our core business is growing strongly, organically,” Mr Hudson added. In the last financial year AFH notched up 20% organic growth and now serves around 10,000 clients, with £2.7bn under management.
During the last 12 months, AFH has acquired 13 IFA businesses together with the protection business Eunisure. As at 31 October, the company had cash balances of £8 million which provides it with sufficient funding to meet the cost of the acquisitions as they fall due, it says.
The board plans to continue its strategy of making “selective acquisitions and increasing AFH's national footprint.” The firm believes it is well positioned to take advantage of consolidation opportunities in the IFA market.
• Editor's Note: Story updated 12.45 pm to add comments from Alan Hudson, CEO.