Market report

AssetCo closes Ocean deal | house prices weak

Martin Gilbert

AssetCo, the wealth manager chaired by Martin Gilbert, has completed the £4.1m acquisition of Ocean Dial Asset Management (ODAM) from Avendus Capital Asset Management (UK).

It follows confirmation of relevant clearances from Indian regulators following approval of the deal last month by the UK’s Financial Conduct Authority.

The initial consideration will see the issue of 1,464,129 ordinary shares and £2.46m in cash. Up to a further 1,464,129 ordinary shares may be issued on a deferred basis until after the calendar year-end in accordance with the provisions of the sale and purchase agreement.

ODAM will be merged with River and Mercantile and will include the combination with AssetCo’s other equity management businesses, said AssetCo in a regulatory filing.

Ocean Dial AM’s investment trust, India Capital Growth fund (ICGF), will be able to “strengthen the breadth and depth of resources available” by tapping into River and Mercantile’s distribution and investment support capabilities, with a focus on ESG.

India Capital growth invests in long-term opportunities in the mid- and small-cap space in India. Since 2011, it has generated an average annual NAV return of 16.4%. For the time being, the running of the trust will be “business as usual” for the investment team, it said. 

Mr Gilbert said: “We are delighted to have completed the acquisition of Ocean Dial on the timetable originally envisaged and to welcome India Capital Growth Fund as an important and valued client of our group.

“We are excited about the long-term potential that India offers and see opportunities to add value by bringing Ocean Dial including Gaurav and his team together with the other active equity asset management businesses we are combining under the River and Mercantile brand.”

Housing remains weak


The UK housing market activity “remains weak”, according to mortgage lender Nationwide as buyers are still being put off by high borrowing costs.

House prices declined 5.3% on-year last month, following a fall of the same pace in August, according to the building society’s house price index.

On a monthly basis, prices were flat in September, following a 0.8% decline in August from July.

Despite the fall in prices, housebuilders rose on interest rate prospects with Barratt Developments up 0.5%, Bellway up 0.5% and Taylor Wimpey up 0.4%.

The EY ITEM Club said the Nationwide’s figures “surprised to the upside” and thinks the outlook for the housing market has improved “a little.”

The economic thinktank explained interest rates look to have peaked “much lower than many had expected only a few months ago.”

“This has led investors to rein back rate expectations and a drifting down in quoted mortgage rates in recent weeks.”

Market close

Defence firm BAE Systems jumped to the top of the FTSE 100 index after winning a £4 billion contract to build attack submarines as part of the AUKUS programme with Australia and the United States. Investors were buoyed by the avoidance of a US government shutdown.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “With a US government shutdown averted for now, it has brought a measure of relief, helping the FTSE 100 step into October with a nudge of positivity in early trade.”

NatWest Group fell 8p, or 3.4%, to 227¾p after Morgan Stanley downgraded the lender to “equal-weight” from “overweight” with a 310p price target.

Also lower was was pubs chain Mitchells & Butlers which, after a strong year, gave up some gains, falling 12.5p, or 5.6% to 213½p. 

The FTSE 100 fell 97.36 points, or 1.3% to 7,510.72 on the first trading day of the last quarter of the year as China, which is largely closed for the Golden Week holiday, weighed on sentiment.

More talk of yet another interest rate increase by the US Federal Reserve hit utility stocks and weighed on indices, with the Dow Jones Industrial Average closing down 0.2%.

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