The company that has made a £145m takeover bid for Nucleus Financial has changed tack after facing opposition from some shareholders.
James Hay had proposed to acquire Edinburgh-based Nucleus by way of a scheme of arrangement. This would have required the support of a majority of holders of shares in Nucleus.
James Hay has decided to make a takeover offer for Nucleus instead. This will require the support of holders of 75 per cent of the shares in Nucleus but not a majority of shareholders.
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News of the change comes after employees of Nucleus said the deal should be opposed amid “significant anxiety” about the impact on jobs at the firm, which supplies online platforms that clients can use to manage their investments on.
Led by founding chief executive David Ferguson, Nucleus employs around 400 people. These include 130 based in Glasgow.
James Hay has said there may be a moderate reduction in headcount at the enlarged group following the takeover. A material number of Nucleus’ employees will transfer over the medium term to FNZ, which will provide platform technology for the enlarged group.
James Hay is based in Salisbury. It is owned by the Epiris private equity business.
Nucleus said yesterday: “James Hay Holdings considers that the Takeover Offer offers greater certainty of execution for Nucleus Shareholders as it removes uncertainty in relation to the satisfaction of the requirement for a majority in number of registered members of Nucleus to approve the Scheme.”
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Shareholders were due to vote on the proposed scheme of arrangement at meetings scheduled for yesterday morning. The deadline for the submission of votes prior to the meeting was 6.30pm on Sunday March 28.
Nucleus noted that by that time 44 registered members had submitted votes, of which 27, or 61 per cent, were in favour and 17, or 39%, were against.
It noted that 94.93% of the total number of votes that had been submitted in respect of the proposed scheme of arrangement were in favour of it.
Nucleus said yesterday: “As the Acquisition is to be implemented by way of a Takeover Offer, the Nucleus Court Meeting and the Nucleus General Meeting which were due to take place … in connection with the Scheme were adjourned and will not be rescheduled.”
Directors of Nucleus recommended last month that shareholders accept James Hay’s 188p per share.
They have provided their consent to the switch to a Takeover Offer. The Takeover Panel has also approved the change.
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A spokeswoman for James Hay said the change to a takeover offer provided greater certainty of execution for Nucleus’ shareholders.
She added: “The combination of the James Hay and Nucleus businesses represents a compelling opportunity to establish a leading independent adviser platform, with c£45 billion of AUA [assets under administration], with the scale to invest and deliver real value for advisers. We admire much about the Nucleus business and look forward to working with the team to better serve the growing needs of advisers.”
The takeover offer will require the support of the holders of a minimum of 75% of the company’s shares in total. James Hay has obtained irrevocable acceptances from the holders of 55.88% of shares including Mr Ferguson.
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