Randall & Quilter Investment has conditionally raised gross proceeds of about £100m via an oversubscribedplacing of new ordinary shares to investors and is proposing to raise gross proceeds of up to a further £7m.
Randall & Quilter is proposing to raise the additional amount through an open offer of new ordinary shares to qualifying shareholders.
This open offer placement is conditional upon passing certain resolutions, the company said. A total of 65,359,477 new ordinary shares were placed by Numis Securities and Shore Capital Stockbrokers, at a price of 153 pence per placing share, raising total gross proceeds to about £100m.
The placing shares represent about 52% of the issued ordinary share capital of the company before the placing.
Additionally, Randall & Quilter is also making an open offer to all the qualifying shareholders for up to 4,499,438 new ordinary shares on the basis of 1 new open offer share for every 28 existing ordinary shares. Total gross proceeds from this open offer will be about £7m.
Randall & Quilter Investment group chairman and CEO Ken Randall said: “We are very pleased to have raised these additional funds and are encouraged by the support received from new investors and existing shareholders. The proceeds from this Placing and also the Open Offer will be used to support the development of our program management business and assist in maintaining the AM Best credit and financial strength ratings of the Accredited companies.
“The proceeds will also replenish liquidity used or allocated to previously announced legacy acquisitions and will help to rebalance our equity: debt funding mix. R&Q is reaping the benefits of our transformation last year into a more focused business operating in two fast growing markets: program underwriting and legacy M&A.
“This transformation continues as are expanding our resources, hiring talent and restructuring to ensure we are best placed to serve our customers. With the support of shareholders and our recent debt issuance we will have greater capital firepower to support our strategy.”
The company stated that it is focused on its legacy acquisition activities and program management business, which is centered around fee generation through its licensed and rated platforms across the US and Europe, where the company acts as a conduit for capital providers, reinsurers and niche underwriting businesses, predominantly MGAs.
As per Randall & Quilter, though new business opportunities in both legacy and program management are good, yet, the exact timing of completion of new legacy deals can often be uncertain, particularly in cases where regulatory approvals are needed. This can result in unpredictability in the profit timings from such acquisitions.
The company said that the net proceeds from the open offer will be used to support the development of its program management business, along with the pursuit of several identified legacy opportunities, replenish liquidity used in previous acquisitions and to rebalance the company’s funding mix.