TIDMALGW
RNS Number : 8064F
Alpha Growth PLC
24 March 2022
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulation (EU) No. 596/2014 (as in force in the United
Kingdom pursuant to the European Union (Withdrawal) Act 2018). Upon
the publication of this announcement, this inside information is
now considered to be in the public domain
Alpha Growth Plc
("Alpha", or the "Company")
Acquisition and Insurance Business Update
Alpha Growth Plc (LSE: ALGW and OTCQB: ALPGF), a leading
financial services specialist in the growing longevity asset class,
is very pleased to announce that its Bermuda subsidiary has signed
a share purchase agreement to acquire a Guernsey based life
insurance company. This transaction advances Alpha's acquisition
strategy of consolidating life insurance companies and represents a
significant step towards achieving Alpha Growth's goal of managing
over $2bn of assets by 2025.
Acquisition
The Guernsey based insurance company is a Category 1,
international life insurer, with approximately 3,785 long-term life
insurance contracts in force as of 31 December 2021.
The acquisition has a transaction value of $3.3m and includes
all operations of the company, including its assets under
management of approximately $370m as valued at 31 December 2021.
The business is being acquired from a major international insurance
group.
This acquisition more than doubles Alpha's assets under
management and provides an excellent platform for Alpha to offer
both life insurance-based wealth management products and life
insurance linked funds, either originated by Alpha or through other
partners.
Additionally, the life insurance company provides a good
European based platform for further acquisitions. All activities
are subject to regulatory approval and oversight.
The Directors of the Company's subsidiary Providence Life
Assurance Company (Bermuda) Ltd (Gobind Sahney, Jason Sutherland,
and Dan Gray) will be joining the acquired company's board.
The acquisition is subject to the approval of the relevant
regulatory authorities and is expected to complete sometime
mid-year. Further updates and information will be provided in due
course.
The Company is funding the acquisition from operations, and it
will not require an equity raise.
Delivering on The 2B Plan
This acquisition is a key building block in delivering upon the
Company's previously announced 2B Plan. The 2B plan is Alpha's
strategy to be managing over $2bn of assets by 2025.
Once the acquisition is completed, the Company's aggregated
assets under management will be over $700m. This provides the
Company with a substantial source of predictable, sticky and
recurring revenue and represents a 70 fold increase in AUM from the
$10m that the Company reported in January 2020.
With this acquisition, and taking into consideration the
excellent prospects of both Alpha's Fund and its Insurance
segments, the Directors have decided to concentrate the Company's
focus on these two key segments. By focusing on these two key
segments, it allows the Company to direct its resources and human
capital efficiently to ensure that maximum growth and shareholder
returns are achieved.
As a result, the Company will be ceasing discussions with
counterparties in regards to separate managed accounts, revolving
credit facilities, and other esoteric AUM building activities.
Whilst these activities would have increased AUM, the Company has
other prospects which provide better returns and which require less
overhead.
This refocusing of activities creates a strong and simpler
proposition with substantial value creation opportunities - the
focus for 2022 will be to continue to aggressively expand both the
fund and insurance segments.
The BlackOak Alpha Growth Fund has grown from $10m to over $50m
since 2020 and once the acquisition is completed the insurance
segment will have grown from zero to over $650m.
Additionally, the Company's subsidiary Providence Life Assurance
Company, as part of the insurance segment, also issued its first
policy since it became part of the Group for a $5m committed
premium this month and continues to expand its plan of distribution
for its policies through registered investment advisors and other
professionals that advise ultra-high net worth individuals and
family offices on PPLI.
The Company continues to have a very strong pipeline of
opportunities across both segments and we are very confident that
these opportunities will drive significant increases in AUM and the
associated fees. We expect to make further announcements in due
course.
Gobind Sahney, Executive Chairman, commented "This acquisition
is another key building block in our plan to be managing over $2bn
of assets by 2025 and I'm very pleased to announce that we are
currently tracking ahead of schedule to achieve that aim."
Gobind continued, "This acquisition not only increases our AUM
substantially, it also provides us with the ability to offer very
tax efficient insurance based wealth management products and will
also serve as a European vehicle for further value accretive
acquisitions."
Alpha Growth will be responding to shareholder questions by the
end of this month and shall be announcing its end of year accounts
by the end of April.
For more information, please visit www.algwplc.com or contact
the following:
Alpha Growth Plc +44 (0) 20 3959 8600
Gobind Sahney, Executive Chairman info@algwplc.com
Arden Partners plc +44 (0) 20 7614 5900
Ruari McGirr / Alexandra Campbell-Harris
(Corporate Finance)
UK Investor Relations - Mark Treharne ir@algwplc.com
About Alpha Growth plc
Specialist in Longevity Assets
Alpha Growth plc is a financial advisory business providing
specialist consultancy, advisory, and supplementary services to
institutional and qualified investors globally in the multi-billion
dollar market of longevity assets. Building on its well-established
network, the Alpha Growth Group has a unique position in the
longevity asset services and investment business, as a listed
entity with global reach. The Group's strategy is to expand its
advisory and business services via acquisitions and joint ventures
in the UK and the US to attain commercial scale and provide
holistic solutions to alternative institutional investors who are
in need of specialised skills and unique access to deploy their
financial resource in longevity assets.
Longevity Assets and Non-correlation
As a longevity asset, it is non-correlated to the real estate,
equity capital and commodity markets. Its value is a function of
time because as time passes the value gets closer to the face value
of the policy. Hence creating a steady increase in the net asset
value of the investment. This makes it highly attractive to
investors wishing to counteract volatility within an investment
portfolio and add yield.
Note: The Company only advises on and manages Longevity Assets
that originate in the USA where the structured and life settlement
market is highly regulated.
Forward Looking Statements Disclaimer
Certain statements, beliefs and opinions in this document are
forward-looking, which reflect the Company's or, as appropriate,
the Company's directors' current expectations and projections about
future events. By their nature, forward-looking statements involve
a number of risks, uncertainties and assumptions that could cause
actual results or events to differ materially from those expressed
or implied by the forward-looking statements. These risks,
uncertainties and assumptions could adversely affect the outcome
and financial effects of the plans and events described herein.
Forward-looking statements contained in this document regarding
past trends or activities should not be taken as a representation
that such trends or activities will continue in the future. The
Company does not undertake any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. You should not place undue reliance on
forward- looking statements, which speak only as of the date of
this document. Readers should not treat the contents of this
document as advice relating to legal, taxation or investment
matters, and are to make their own assessments concerning these and
other consequences, including the merits of information and the
risks. Readers of this announcement are advised to conduct their
own due diligence and agree to be bound by the limitations of this
disclaimer.
Important Notice
The content of this announcement has not been approved by an
authorised person within the meaning of the Financial Services and
Markets Act 2000 (FSMA). This announcement has been issued by and
is the sole responsibility of the Company. The information in this
announcement is subject to change.
ENDS
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