Premier Asset Management chief executive Mike O’Shea says one of the key reasons for the company to delist is to head off any takeover bids if stockmarkets fall.
The company’s management, backed by private equity firm Electra Partners, is set to take the fund firm off the Alternative Investment Market after having its £51.9m buyout bid accepted by the board.
The company’s management will be majority shareholders in the business.
O’Shea says concerns about the market cycle and the level of merger and acquisition business going on in the financial services sector was concerning management.
He says: “The asset management industry is cyclical so there is a certain dependency on the performance of the equity market and, to an extent, we are at the behest of them, especially if markets struggle and we became subject to a takeover.”
He says going private will also enable it to attract and retain talent.
“Being a private company will give us the freedom to build our assets under management in the shorter term. We can also offer flexible remuneration offerings for future and existing managers at the firm.”
The deal is being carried out through bidding vehicle Harvard Bidco.
O’Shea says: “We are the majority shareholders in the deal and in Electra Partners we have an undated evergreen structure that should give us all the tools we need to build the business going forwards and although no plans are yet announced we will be looking at develops in the near future.”