Midas sells off broking business

FUND manager Midas Capital has reached an agreement to sell its Intelli Corporate Finance business.

Intelli, a corporate advisory and broking firm with offices in London and Edinburgh, has been sold to Canada-based Canaccord Adams.

Midas, which operates Midas Capital Partners in Liverpool, bought the business in 2005. It said it would use the cash from the deal to, “partially retire the group’s preference capital”.

In March Midas struck a deal with its bank, the Bank of Scotland, to convert debts worth £36.5m into a combination of preference shares and a new loan facility.

Under the terms of the deal Midas must buy back the shares within seven years. If £2.5m of the nominal value is not repaid by September 30, 2011 the bank can subscribe for a further 10% of the company’s ordinary shares – giving it an aggregate holding of 29.9%.

Intelli had combined revenues for the year to December 31, 2008 of £3.7m and profit before tax and management charges of £503,000. At December 31 the net book value of the Intelli business was £3.3m.
 
Midas said it would receive a cash payment equivalent to net assets as at September 30, 2009 plus goodwill of £1m.

Chairman Colin Rutherford said: “The sale of Intelli to Canaccord will realise cash resources which will be used to partially retire the group’s preference capital. I would like to pay tribute to the Intelli team for their significant contribution to the group over the past four years and wish them continued success for the future.”