LONDON (ShareCast) - (Sharecast News) - Fund management company JTC announced the acquisition of Luxembourg-based specialist provider of corporate and related fiduciary services Exequtive Partners (EP) on Tuesday.
The London-listed firm said EP was being acquired from Primitivo, De Gorzen, Tika Holdings, Pimpiri and Stichting Administratiekantoor Employee Benefit Jomaroma, which primarily represented the principals of EP, and would join JTC with immediate effect.

EP's 28 employees would join the existing JTC institutional client services team in Luxembourg.

As well as expanding JTC's market presence in Luxembourg, the company said the acquisition would build on its corporate services capabilities, complement its funds offering, and create greater opportunities for future growth in the jurisdiction.

The consideration for the acquisition would comprises an initial consideration of €25m, satisfied by €18.34m in cash and the issue of 1,925,650 new ordinary shares in JTC, of which 173,482 shares - or €0.6m - were being contributed to the JTC employee benefit trust.

It would also comprise an earn-out which, if payable, would be paid 70% in cash and 30% in shares during 2020, based on EP's performance on a sliding scale against revenue and EBITDA targets for the year ended 31 December 2019.

The total consideration payable was subject to an absolute cap of €34m, subject to customary closing adjustments.

In the year ended 31 December 2018, EP made a profit of €61,000, an adjusted EBITDA of €2.5m, and had gross assets of €1.9m.

JTC said it expected the transaction to be "immediately" earnings enhancing, adding that the acquisition formed part of its ongoing growth strategy as outlined at its initial public offering in March last year, and underlined in the trading update issued on 24 January, with the company continuing to see further opportunities for organic and inorganic growth.

"Exequtive Partners is a specialist business in a key strategic location that has demonstrated exceptional performance since its inception," said JTC chief executive officer Nigel Le Quesne.

"As such, this acquisition is reflective of our focus on high quality growth and on strengthening our proposition for institutional clients."

Le Quesne said the management team at Exequtive Partners had built a successful business based on "very similar principles" to JTC, making it an "excellent cultural fit" for the firm while also enabling EP to become part of JTC's established network focussed on client service excellence.

"We extend a warm welcome to our new colleagues, clients and partners."

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