Circ re European Equity Fund Management Team
Not for release, publication, transmission or distribution directly or
indirectly in or into the United States, Canada, Australia, Japan, New Zealand,
the Republic of South Africa or the Republic of Ireland.
16 June 2006
Stock Exchange Announcement
LIONTRUST ASSET MANAGEMENT PLC
European Equity Fund Management Team
On 1 February 2006, Liontrust Asset Management PLC ("Liontrust") announced that
two experienced European equity fund managers, Gary West and James
Inglis-Jones, would be joining Liontrust, which they did on 1 March 2006. Since
that date, they have been jointly developing a European equity investment
process which, together with the arrangements described below, will enable
Liontrust to launch a number of collective investment vehicles including long/
short investment funds and long-only unit trusts and offshore funds based on
the new European equity documented process. It will also be offered to the
institutional market via segregated accounts and pooled pension funds.
Consistent with its ambitions for the strategic development of the business,
Liontrust is focused on seeking to provide an appropriate level of equity
incentivisation for its employees. Accordingly, Liontrust has today entered
into a conditional agreement to implement the proposals described in the
announcement made on 1 February 2006 relating to a proposed investment in a new
group company, Liontrust European Investment Services Limited ("LEIS"). LEIS is
to provide European equity fund management services to support the new
investment process.
The principal terms of the proposals provide for the acquisition by Liontrust
of a 51 per cent. equity interest in LEIS, with the balance to be acquired by
Gary West, James Inglis-Jones, Jeremy Lang and William Pattisson. The
investments by Jeremy Lang and William Pattisson reflect the roles that they
will have in developing the European equity business. Liontrust will also
provide further funding to LEIS, both for regulatory and working capital
purposes, (resulting in its total investment in LEIS totalling £1.35 million (£
0.15m for ordinary shares in LEIS and £1.2m for cumulative redeemable
preference shares in LEIS)). Liontrust will be granted an option to buy out the
minority shareholders in LEIS after five years (or in certain circumstances
sooner) on a valuation that is at a 25 per cent. discount to Liontrust's
revenue multiple at the time of the buy-out. The minority shareholders will
also be granted an option to require Liontrust to buy out their shares in LEIS
after five years (or in certain circumstances sooner) based on the same
valuation formula.
The consideration payable under the option (and certain of the leaver
provisions comprised in the proposals) is to be satisfied through the issue of
new Liontrust shares, or a mixture of new Liontrust shares and cash, or cash
only. The maximum consideration payable under the option (and certain of the
leaver provisions) granted to Liontrust has been capped such that any payment
would not exceed 25 per cent. of the share price of Liontrust at the relevant
date multiplied by the issued share capital of Liontrust at the time of grant
less the amount Liontrust paid for its investment in LEIS. Any Liontrust shares
issued as consideration will be subject to appropriate lock-up arrangements.
For further information please contact:
Liontrust Asset Management PLC:
Nigel Legge or Vinay Abrol Tel: 020-7412 1700
JPMorgan Cazenove Limited:
Richard Locke Tel: 020-7155 4706
Notes
Gary West and James Inglis-Jones previously held senior positions at JPMorgan
Fleming in the European investment division of which Gary was co-head until his
departure. More recently, Gary and James worked at Polar Capital where they
established a European Market Neutral product. Gary West has been managing
funds since 1988. In 1999, after four years at Fleming Investment Management
(where he worked alongside Liontrust's Joint Investment Director, William
Pattisson), he was promoted to joint head of the European equity department.
James Inglis-Jones was a senior portfolio manager within JPMorgan Fleming
European equity group with responsibility for a wide range of institutional and
retail portfolios. Gary West and James Inglis-Jones joined Liontrust on 1 March
2006.
LEIS is a new group company, which will provide European equity fund management
services in relation to the investment process developed by Gary West and James
Inglis-Jones. As at the date of this announcement, LEIS has not traded and its
gross assets and profits were nil. The first accounts of LEIS will be for the
period to 31 March 2007.
Further information is contained in a circular sent to shareholders today.
Copies of the circular have been submitted to the UK Listing Authority and are
available for inspection at the Document Viewing Facility, which is situated
at:
The Financial Services Authority
25 The North Colonnade
Canary Wharf
London
E14 5HS
Tel : 020 7676 1000
JPMorgan Cazenove Limited, which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting as financial adviser to
Liontrust in relation to matters described in this announcement and is not
acting for any other person and will not be responsible to any other person for
providing the protections afforded to customers of JPMorgan Cazenove Limited
nor for advising them on the contents of this announcement.
The release, publication, transmission or distribution of this announcement in
jurisdictions other than the United Kingdom may be restricted by law and
therefore persons in such jurisdictions into which this announcement is
released, published, transmitted or distributed should inform themselves about
and observe such restrictions. Any failure to comply with the restrictions may
constitute a violation of the securities laws of any such jurisdiction.
ENDS
1
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