Gresham House will become the latest UK-listed firm to be taken private after agreeing a £470m deal with US-based private equity company Searchlight Capital.
Shareholders in the AIM-listed fund manager, which invests in assets such as forestry and solar farms, will receive 1,105p per share, a premium of 63 per cent to its closing price on Friday.
The Gresham House board of directors unanimously recommended the offer to shareholders.
The board said that its ability to raise funds and access new capital was challenging as a listed company but could be “accelerated” through the deal.
The existing management team has the support of Searchlight, providing continuity for Gresham House’s clients and stakeholders.
Anthony Townsend, chair of Gresham House, said the deal represents a “compelling opportunity” in the challenging economic environment.
“The acquisition by Searchlight starts a new and exciting chapter for Gresham House. We are confident that Searchlight will accelerate our international and domestic growth strategy and their long-term capital and global expertise will support and enhance our investment teams’ ability to deliver returns to clients,” he continued.
In its most recent results, Gresham House posted a 35 per cent surge in earnings despite the economic downturn sparked by the war in Ukraine and surging inflation.
Searchlight said it was attracted by Gresham House’s position in sustainable alternative asset classes and believed there was a “robust platform” for future growth.
It saw “significant potential…to make further bolt-on and potentially transformational transactions across asset classes and internationally”.
Over the last few years Gresham House has been expanding its forestry holdings internationally, managing £3.4bn worth of forests in the UK, Europe and Australasia.
The acquisition will require the approval of at least 75 per cent of Gresham House’s shareholders with the deal expected to become effective later this year or early next year. 33 per cent have already backed the deal.
A slew of UK-listed firms have been taken private in recent months as foreign buyers have been attracted by the relatively cheap valuations on offer.
A number of firms were also picked off last year amid a downturn in the market, with Ted Baker and transport firm GoAhead among the names to be taken private.