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US private equity firm increases bid for AFH to £231.6m

A day after the UK wealth manager postponed its shareholder vote on the original offer

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Private equity firm Flexpoint Ford has upped its bid for UK financial planning group AFH to £231.6m ($327.5m, €272.6m).

This comes a day after AFH postponed the shareholder vote on the first offer of £225m, which was reportedly rejected by shareholders.

The latest offer from Cortina Bidco, a newly incorporated company indirectly controlled by US-based Flexpoint Ford, values each share at £0.48.

AFH said in a London Stock Exchange statement on 2 March that independent directors “consider the terms of the increased offer to be fair and reasonable”.

The increased offer “will be funded by a combination of equity financing drawn down from the Flexpoint Funds pursuant to an equity commitment letter entered into by the Flexpoint Funds and debt financing drawn down under an interim facilities agreement arranged by Ares Management”, AFH added.

Shareholders

For the M&A deal to go ahead, the firm will need 75% of shareholders to approve the proposal.

On 22 February, International Adviser reported that Slater Investments, which owns almost 13% of the company, turned down the original offer of £225m.

This backlash caused AFH to postpone its general meeting on 1 March and also suspend trading in its shares.

It is believed that the general meeting was scheduled to approve the offer.

AFH said on 2 March: “It is intended that the court meeting and the general meeting be reconvened in due course in connection with the increased offer” and AFH shareholders “will be notified of the revised times” as soon as “reasonably practicable”.

The UK wealth manager also said that trading in AFH shares resumed with effect from 7.30am on 2 March 2021.

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