UK investment house Edinburgh Fund Managers (EFM) is set to acquire Portfolio Fund Management from Liberty International, pending regulatory approval.
The agreement to bag the £430m UK funds-of-funds and unit trust business is based on an initial cash consideration of £12m and a deferred cash consideration of up to £8m.
The acquisition takes EFM’s open-ended funds under management to over £1bn and total assets to £8.3bn.
Portfolio - founded in 1989 - has £170m invested through its funds-of-funds and more than 30,000 accounts. EFM already offers two funds-of-funds worth £136m. The acquisition creates a £320m funds-of-funds operation under the Edinburgh name, directed by Portfolio managing director, Paul Talbot.
EFM - which does not currently hold property assets - also gains an £80m property fund, managed by Liberty International.
This is the firm’s second buy after EFM bought venture capital house Northern Venture Managers in June 2000.
EFM’s chief executive, Iain Watt commented: “It has been our policy both to grow organically and to strengthen the range of our business offering through strategic ‘infill’ acquisitions.”
He added: “In terms of immediate impact, we expect the purchase to be earnings neutral in the first year, and earnings enhancing thereafter.”
The deal is expected to be completed by Q3.
By Madhu Kalia
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