Somers bids for Australian financial services company
A Bermuda financial services investment firm has submitted a binding proposal to take over an Australian diversified financial services company that provides funding solutions for small to medium businesses.
The Bermuda company, Somers Ltd, already holds about 49 per cent of Thorn Group Ltd, a company listed on the Australian Securities Exchange, the primary stock exchange in Australia.
Thorn provides working capital and business asset lending solutions, working in partnership with Australian brokers and accountants.
Somers is seeking to acquire the remaining shares, so as to own 100 per cent of the Thorn Group.
Thorn made it clear in an ASX announcement on Friday that discussions are preliminary and incomplete, and no agreement has yet been reached.
In a filing with the Bermuda Stock Exchange, Somers said the proposal would be conducted by way of a scheme of arrangement under Australia’s 2001 Corporations Act but subject to a number of conditions at Thorn's annual general meeting on Thursday.
The conditions include shareholder agreement for the proposed sale of a majority of Thorn’s asset finance portfolio to Resimac Group Limited.
Somers owns a controlling interest in the Resimac Group.
The Proposal also permits, at Thorn’s discretion, to undertake a $10 million or higher capital reduction payable to Thorn shareholders, subject to the adjustment to the consideration and shareholder approval.
Thorn shareholders would receive total cash consideration of $1.62 per share, less any dividend or capital return paid to shareholders, including the proposed dividend and capital return in connection with the sale of a majority of Thorn's asset finance portfolio to Resimac.
This June, Thorn announced that it had entered into an agreement with Resimac for the sale of the asset finance portfolio, conditional on, among other things, shareholder approval.
Somers says Thorn would distribute the cash proceeds of the proposed transaction to its shareholders as soon after completion as practical.
If the Resimac deal goes through, Thorn will commence a staged transition of its business with a focus on active investments in the fintech sector that align with Thorn's core business strategy as a diversified small business focused financial services organisation.
Thorn would also agree to provide Somers with an unsecured loan of $29 million, less the total amount of dividend or capital return paid to scheme shareholders (including the capital return to scheme shareholders in connection with the transaction with Resimac) repayable in 10 years to fund Somers’ payment of the scheme consideration.
Somers’ major assets include a 54.4 per cent holding in Resimac Group Limited, which had A$16.0 billion assets under management at 31 December 2022.
Somers also has a 61.8 per cent holding in Waverton Investment Management Group Limited, a UK wealth manager with £13.3 billion funds under management and administration.
Somers has shareholders’ funds of approximately £281.7 million.
Publicly listed Somers’ shares are traded on the Mezzanine Market of the Bermuda Stock Exchange.
Thorn Group Ltd (ASX: TGA) was up Friday by 17 cents (12.41 per cent) at $1.54 per share.