ARBUTHNOT BANKING GROUP PLC

M&A Activity • Dec 20, 2016

National Storage Mechanism | Additional information

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RNS Number : 4108S

Arbuthnot Banking Group PLC

20 December 2016

20 December 2016

Arbuthnot Banking Group PLC

Asset Backed Finance Acquisition

Arbuthnot Banking Group PLC ("Arbuthnot" or "the Group") today announces that its wholly owned subsidiary Arbuthnot Latham ("AL") has reached an agreement to acquire 100% of Renaissance Asset Finance Limited ("RAF") from its founders.

The acquisition remains subject to regulatory approval and completion is therefore expected to take place early in the second quarter of 2017.

RAF is a provider of finance for a range of specialist assets which includes vintage and expensive cars and SME business assets. On 30 November 2016 customer assets were £68m and RAF's net assets were £1.6m.

Consideration will be paid in four staged amounts, all of which will be in cash. The first amount will be paid at completion and will equal the net assets of RAF at that time. The remaining amounts will be made annually based on the profitability of the business in each of the following three years. The maximum amount payable for the performance based payments is limited to no more than £6.5m

Both consideration and the refinancing of RAF's funding liabilities (approximately £66m) will be satisfied from the Group's current cash resources.

The unaudited accounts of RAF for the twelve months ended 30 June 2016 show a profit before tax of £2.4m (which included a one off income amount of £1.75m) with the average gross customer yield being 8.9%, which is after allowing for 3% of broker's commissions.

Commenting on the transaction Ian Henderson the Chief Executive of Arbuthnot Latham said:

"Following the transformational deals completed by ABG earlier this year, I am delighted that Arbuthnot Latham, with the support of ABG can further develop its expansion and diversification plans. The acquisition of RAF will fit well alongside our growing Private and Commercial banking units and I welcome the team from RAF into the Group. I look forward to working with them in the future."

Enquiries:

Arbuthnot Banking Group                                                                                            0207 012 2400

Sir Henry Angest, Chairman and Chief Executive

Andrew Salmon, Group Chief Operating Officer

James Cobb, Group Finance Director

Ian Henderson, Group Director and Chief Executive Arbuthnot Latham

Stifel Nicolaus Europe Ltd trading as KBW (Nomad and Joint Broker)              0207 710 7600

Robin Mann

Gareth Hunt

Stewart Wallace

Numis Securities Ltd (Joint Broker)                                                                          0207 260 1000

Chris Wilkinson

Andrew Holloway

Bell Pottinger (Financial PR)                                                                                         0203 772 2563

Ben Woodford

This information is provided by RNS

The company news service from the London Stock Exchange

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