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Impax Asset Management (LON:IPX)

  • Share price: 107.5p (pre-open)
  • No. of shares: 128 million
  • Market cap: £137 million

Acquisition of Pax World

This environmental asset manager announces it's buying a US (New Hampshire)-based asset manager ("Pax World"), operating in the same field of sustainable investing.

The two companies already have a partnership together, running a $511 million environmental fund, so they should know each other well.

Impax's run-rate Revenue and EBITDA are given as £36 million and £11 million, respectively (July 2017) based on managing £7.2 billion of AUM.

This deal will create an entity with combined AuM of over £10 billion, using August figures. It's a >40% increase in AUM in one shot! And it will now be a trans-Atlantic operation with a much wider range of research capabilities, and wider product ranges.

The deal is valued at $52.5 million plus up to $37.5 million in contingent payments out to 2021. It's mostly being paid in cash, with a $26 million bank facility being involved.

My opinion

Looks very exciting! Asset managers thrive on scale: the costs of infrastructure weigh them down initially, but then they are scalable to infinity.

Reaching over £10 billion in AuM puts this in a new size category and gives a fresh reason to invest. The overall risk has certainly increased with the addition of a large debt facility, but successfully integrating this company should set Impax up nicely for many years ahead.




Finsbury Food (LON:FIF)

  • Share price: 101.25p (+2%)
  • No. of shares: 130.4 million
  • Market cap: £132 million

Preliminary Results

Paul has been rather underwhelmed about this bakery for a while. It's not hard to see why, as like-for-like sales and earnings growth have been underwhelming for a while. Profit forecasts have been gradually sinking too:

59bf730fe9723FIF_20170918.PNG


Today's final results confirm adjusted EPS of 9.6p, putting this share firmly in "cheap" territory (though not necessarily value!)

Full-year like-for-like sales are flat at £314 million, adjusted operating profit is up 4% to £17 million, and PBT comes in at £13 million, vs £11.8 million last year. The CEO describes it as "solid delivery against expectations".

Given the conditions in the sector, it seems like a reasonable set of results.…

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