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Axiom European Financial Debt Fund to raise funds
Posted on Tuesday, 14 November 2017 09:47
Axiom European Financial Debt Fund (AEFD) has agreed to issue up to 500.00 million new shares through a stock placement.

The transaction comes as its portfolio manager Axiom Alternative Investments is seeking to double down on Europe’s recovering banking sector.

While the offer price has not been disclosed, the deal can be valued at around GBP 490.00 million based on the target’s close of GBP 0.98 on 7th November 2017, the last trading day prior to the announcement.

The new shares account for 89.1 per cent of AEFD’s enlarged capital and are expected to commence trading on 15th December 2017.

AEFD invests in financial assets, such as regulatory capital instruments, senior debt, collateralised debt obligations and derivatives, of European financial institutions.

As of 30th June 2017, it had net assets of GBP 60.25 million and was largely exposed to institutions based in the UK, France and Germany.

The entity posted total income of GBP 1.62 million in H1 2017, down 22.3 per cent on the GBP 2.09 million recorded during the same timeframe in the previous year.

Profit for the period totalled GBP 4.39 million, compared to a loss of GBP 2.17 million in the six months ended 30th June 2016.

With the proceeds, the fund will invest in the subordinated debt market to “benefit from the positive credit actions by rating agencies, which should therefore support further spread compression”.

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 352 deals targeting funds, trusts and other financial vehicles in the UK announced since the beginning of this year.

The largest of these was Kennedy-Wilson Holdings’s GBP 2.07 billion acquisition of the remaining 76.4 per cent stake in its London Stock Exchange-listed real estate fund.

© Zephus Ltd