TIDMSTM
RNS Number : 6855T
STM Group PLC
26 July 2022
STM Group Plc
("STM" or "the Company" or "the Group")
Acquisition of UK SIPP and SSAS portfolio
'Doubling the size of UK Options personal pension solution
business'
STM Group Plc (AIM: STM), the cross border financial services
provider, is pleased to announce that it has entered into an
agreement to acquire the portfolio, net assets and trustee
companies of the SIPP and SSAS businesses, from Mercer Ltd, for a
fixed consideration of GBP3.34 million (the "Acquisition").
Completion is planned for 31 August 2022.
The Acquisition will be funded from existing financial resources
and the remaining available debt facility previously arranged with
the Group's bank.
The Acquisition is not subject to regulatory approval as STM is
not acquiring the regulated entities themselves, however both
parties have kept the FCA informed of progress throughout the
transaction process.
Highlights of the Acquisition:
-- The Acquisition of the portfolio is complementary to STM's
existing product offerings in the UK SIPP and SSAS market and will
add some 2,100 SIPPs and 700 SSASs to the UK portfolio, which will
double the revenue generated from that UK personal pensions
business and provide a solid platform for scalability, particularly
for our SSAS operations, and efficiencies going forward.
-- STM will retain the office premises in Cardiff, as well as
the existing staff members, who are well regarded and experienced,
giving a further depth of resources and knowledge to STM's UK
business.
-- The portfolio generated some GBP0.87 million EBIT for the
last financial year ended December 2021 and is expected to continue
contributing GBP0.87 million EBIT to STM's current UK business,
Options, on an annualised basis, after a twelve month phased
integration process. As a result of transaction costs of GBP0.3
million, and specific integration costs of GBP0.3 million, it is
anticipated for the four months to 31 December 2022 that the
Acquisition will be a negative contribution of GBP0.3 million to
the Group's result.
-- STM will work with Mercer's team to ensure a seamless
transition for clients, staff colleagues, and other stakeholders,
and have entered a transition agreement with Mercer for a period of
up to six months as commitment to such a process.
-- The Acquisition of the portfolio will also give Options
access to an expanded network of intermediaries who have introduced
clients to Mercer. Working with the established team in Cardiff,
Options will build further on the existing strong
relationships.
-- The Acquisition consideration includes the purchase of the
net assets of the business which amount to circa GBP 1.0 million,
which primarily relates to fees yet to be collected from clients.
In addition, Options, will make a one-off adjustment to account for
deferred revenue under its accounting policy.
Commenting on the Acquisition, Alan Kentish, Chief Executive
Officer of STM, said:
"We are delighted that Mercer has chosen STM as the new home for
its SIPP and SSAS business, previously acquired as part of its own
acquisition of JLT. Both ourselves and Mercer are committed to
ensuring a seamless transition for clients, intermediaries, staff
and other stakeholders.
"The revenue generated by this portfolio will mean that our
Options personal pension solution business in the UK will
effectively double in size and will give us a new centre of
excellence for our SSAS business.
"The business is well run by the team in Cardiff. This allows us
to implement an integration plan that can dovetail with our overall
plans in relation to changing our operating model to improve our
margins, post significant investment in our IT infrastructure. I am
delighted to welcome the team to the STM family.
"The SIPP marketplace continues to see change and out of this
comes opportunity to differentiate our proposition. Unlike most
SIPP providers, STM also has a UK workplace pension solution and
this in itself allows us to offer a full suite of retirement
savings options to anyone, no matter where they are within their
career path.
"I look forward to updating the market as to our progress on
this exciting next stage of the STM journey."
For further information, please contact:
STM Group Plc
Alan Kentish, Chief Executive Officer Via Walbrook PR
Nicole Coll, Chief Financial Officer www.stmgroupplc.com
finnCap www.finncap.com
Matt Goode / Abigail Kelly - Corporate Finance Tel: +44 (0) 20 7220
Tim Redfern / Richard Chambers - ECM 0500
Walbrook www.walbrookpr.com
Tom Cooper / Joseph Walker Tel: +44 (0) 20 7933
8780
Mob: +44 (0) 797 122
1972
STM@walbrookpr.com
Notes to editors:
STM is a multi-jurisdictional financial services group traded on
AIM, a market operated by the London Stock Exchange. The Group
specialises in the administration of client assets in relation to
retirement, estate and succession planning and wealth
structuring.
Today, the Group has operations in the UK, Gibraltar, Malta,
Australia and Spain. STM has developed a range of pension products
for UK nationals and internationally domiciled clients and has two
Gibraltar life assurance companies which provide life insurance
bonds - wrappers in which a variety of investments, including
investment funds, can be held.
STM's growth strategy is focussed on both organic initiatives
and strategic acquisitions.
Further information on STM Group can be found at
www.stmgroupplc.com
.
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