AIM listed financial planning and investment management firm AFH Financial Group has raised £750,000 via a Placing to fund its continuing acquisition strategy and for general working capital purposes.
AFH admits to currently undertaking due diligence on several acquisitions which it expects to conclude in the coming months.
The company placed 535,716 new ordinary shares of ten pence each at 140 pence per share. The price of the placing represents a discount of approximately 3.4% to the closing mid-market price on AIM of AFH’s shares of 145p on 27 May 2015.
The placing comes after AFH’s recent purchase of Stroud based Independent Financial Services (U.K.) Limited. This is a national firm of IFAs and brings an additional 35 advisers to the AFH group, as well as numerous national affinity group relationships. It is AFH’s largest acquisition so far and brings the Company’s total funds under management to approximately £1.7 billion.
Current year revenue is expected to be in line with the AFH board’s expectations and the company remains cash generative at the operating level. It will have £4.75 million of cash following the Placing.
Chief Executive of AFH Alan Hudson said: “We are delighted to be able to place these shares and to also satisfy demand from certain existing shareholders who wish to increase their investment in AFH. These funds will assist us in executing our growth strategy. Our cost base has increased in the current financial year as a result of the IFS acquisition but our shareholders will see the rewards of our investment in acquisitions in the following financial years.”