Midas looks to £7.25m wealth management sell-off

FUND manager Midas Capital is preparing to sell another part of its business.

It is has received a £7.25m offer from insurance broker Jardine Lloyd Thompson for its Iimia Wealth Management arm.

In September Midas, which owns Liverpool-based Midas Capital Partners, sold its Intelli broking business to the Canadian firm Canaccord Adams.

The disposals follow a half year operating loss of £4.3m after a turbulent period which saw it forced to restructure its debt with its bank.

In the six months to June 30 Exeter-based Iimia Wealth Management, which trades as Iimia, Iimia Financial Planning and JK Miln & Co, contributed £460,000 to Midas’ consolidated profit before management charges, amortisation, exceptional items and tax of £2.9m.

If the deal completes in January Midas plans to use a large part of the cash to “further retire the group’s preference share 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 it 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%.

Midas chairman Colin Rutherford said: “We are extremely grateful to our wealth management team for their contribution over the years. The combination with JLT presents their business with an exciting growth opportunity. With its expected completion in January 2010 we can focus, as planned, on fund management activities through our Midas and Miton brands.”