US asset manager Waterfall has confirmed that it will buy UK-based Alternative Credit Investments – formerly known as Pollen Street Secured Lending – for £639m in cash.
Last month, Waterfall Asset Management was appointed manager of the Pollen Street Secured Lending (PSSL) investment trust. Soon after, PSSL rebranded to become Alternative Credit Investments (ACI).
According to a notice placed on the London Stock Exchange this morning, Waterfall EIT UK – a newly-formed company managed by Waterfall Asset Management – has agreed to pay £639.2m for ACI.
Under the terms of the acquisition, all ACI shareholders will receive 870p per share, as well as an interim dividend of up to 12p per share for the third quarter of the year.
The acquisition price represents a premium of approximately 5.1 per cent on the closing price of 828p per ACI share, as at 24 February 2020. This was the last business day prior to the start of a proposed 12-month offer period, during which time PSSL also received an offer from Honeycomb Investment Management.
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“The board welcomes and unanimously recommends the offer from Waterfall, which we believe is the best outcome for shareholders, providing liquidity and certainty,” said Simon King, chairperson of ACI.
“The offer already has the support of holders of 40.8 per cent of the company’s shares and we urge undecided shareholders to consider the advantages of this firm cash offer against the alternatives in highly uncertain markets.”
“We are very pleased to announce this acquisition with the unanimous recommendation of the board of ACI,” said Patrick Lo, partner of Waterfall.
“As an experienced asset manager in the structured credit market, we believe that the acquisition represents an attractive opportunity to secure a portfolio of assets that fits with our existing investment strategy, while seeking to provide ACI shareholders with certain and timely liquidity at an attractive price.”
The acquisition is expected to complete during the first quarter of 2021.