Funds milestone

Nucleus chalks up record ahead of takeover

David Ferguson

David Ferguson: ‘incredibly strong figures’ (pic: Terry Murden)

Nucleus Financial, the Edinburgh wrap platform, secured its best ever month for cash inflows ahead of its expected takeover.

In March customers transferred £637 million funds, the highest monthly figure on record.

The company grew assets under administration (AUA) to £18bn as of 31 March 2021, up 28.4% year-on-year and 3.1% on the previous quarter.

By comparison, the FTSE All-Share Index increased 23.3% year-on-year and by 4.3% on the last quarter.

The latest figures were released yesterday as James Hay published the documents relating to the £145 million takeover offer for the company.

James Hay initially proposed to acquire Nucleus by way of a scheme of arrangement. This would have required the support of a majority of the holders of Nucleus shares.

After facing opposition from some shareholders, it was agreed to pursue the deal through a takeover offer. This will require the support of holders of 75% of the shares in Nucleus, rather than a majority of shareholders.

James Hay has obtained irrevocable undertakings to support its offer from the holders of 55.88% of Nucleus shares, including Mr Ferguson.

James Hay set 1pm on 4 May as the first closing date for acceptances.

A number of Nucleus’ employees will transfer to FNZ, which will provide platform technology for the enlarged group.

David Ferguson, Nucleus’ founder and CEO, commented: “The first quarter has been incredibly strong for new business activity, reflecting the continued achievements of our people and validating our decision to maintain our investment programme through 2020.

“Q1 net inflows were substantially up on Q4 (and on the prior year) and, at over £300m for the first time in a single month, March was by far our best-ever month for inflows, a trend we’d hope to see continue as lockdown eases.

“User satisfaction continues to improve following the successful acquisition and integration of our new colleagues from OpenWealth. We are pleased with our Q1 performance.

“Profit for the year to date is ahead of the board’s expectations as a result of higher AUA and lower costs and we believe the business is well-positioned to accelerate inflow momentum and to expand our operating margin through the rest of this year and beyond.”

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