UK equity hedge fund manager David Crawford (pictured) has opened a near-10% position in recently-launched financial adviser and asset manager Tavistock Investment as it raises money to fund an acquisition.
Crawford took 25 million shares in the company, or 9.10% of the enlarged equity worth £500,000, at a price of 2p, down 61% since a consolidation of shares and financial services relaunch in May 2014.
The shares are held in Crawford’s City Financial Absolute Equity fund, among the top-ten long-short equity funds in the UK over both the last 12 months and five years.
Formerly a software developer, Tavistock sold its legacy business last year and purchased financial adviser County Life & Pensions and asset manager Blacksquare Capital, to create a combined company.
More recently the group last month agreed to reverse takeover of IFA Standard Financial Group, to be funded via £2.7 million raised in new equity issuance.
‘Whilst it is not possible to definitively state the level of assets that are currently advised upon by members of the Financial network, the directors believe the amount to be in excess of £2.6 billion,’ the company said in a statement.
‘Following completion, Financial's advisers will be able to offer the services of Tavistock Wealth to those of their clients for whom it is appropriate.
‘As only a limited number of additional staff would be required by Tavistock Wealth in order to manage a much higher level of clients' assets in its portfolios, it is believed that any meaningful penetration of Financial's present client base will result in a substantial increase in the group's profitability.’
While a shareholder register held by Reuters has yet to update to reflect the enlarged share capital, it currently remains heavily dominaated by management.
Wealth management businesses have been significantly re-rated upwards in recent years as being among the perceived beneficiaries of regulatory changes, and more recently pension liberalisation.