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Birmingham Post
Birmingham Post
Business
Jon Robinson

Frenkel Topping Group to raise £10m to help fund three new deals

Plans to raise £10m to help fund three new acquisitions have been announced by a specialist independent financial adviser and wealth manager.

Manchester-headquartered Frenkel Topping Group has launched an accelerated bookbuild by way of a placing of up to 14,285,715 new ordinary shares of 0.5p each in the capital of the company at a price of 70p per new ordinary share.

The business added that it has entered into a placing agreement with finnCap Ltd to act as the sole bookrunner.

READ MORE: Losses slashed at Bolton Wanderers owner in promotion year despite turnover hit

In a statement, the AIM-listed company said the net proceeds will be used to:

  • Accelerate the company's vision of becoming the market leader in providing a full service offering to clients and claimants, particularly in personal injury and clinical negligence.
  • Consolidate the heavily fragmented pre-settlement professional services market by targeting acquisitions that have clear synergies in the PI and Clin Neg sectors in order to scale routes into growing assets under management mandates from successful claims.
  • Fund three potential acquisitions which have been identified and are in the course of due diligence.
  • Further invest in the integration of existing acquisitions to capture additional margin and allow for faster integration of future acquisitions.

North Atlantic Smaller Companies Investment Trust, the company's majority shareholder, whose chief executive is Christopher Mills, a non-executive director to the firm, intends to participate in the placing.

A Frenkel Topping Group said: "In July 2020 the company set out its refocused M&A strategy to consolidate the professional service firms market in the personal injury and clinical negligence space and raised £13m from new and existing shareholders in order to prosecute a roll-up of professional services firms in this specific niche sector.

"This allowed the company to increase its touch points with claimants, through the timespan of a claim, which the directors believe greatly enhances the company's chances of winning the AUM mandate of any successful claim, whilst generating meaningful revenues in the process.

"Since then, the company has deployed the net proceeds of the July 2020 fundraising acquiring five businesses spanning forensic accountants, cost consultants and the transformational acquisition of Cardinal Management Limited which has close partnerships with NHS Major Trauma Centres.

"The combination of these strategic acquisitions has significantly expanded the group's reach and created further touchpoints in the PI and CN space which has generated strong momentum and engagement with other legal and professional services providers in the sector, greatly increasing the group's service to its clients.

"The group has also delivered £4.6m of EBITDA, an increase of 84% to the previous financial year.

"The group remains focused on its stated M&A strategy of consolidating ownership of the full supply chain in the PI and CN space and accordingly will primarily utilise the net proceeds of the placing to continue consolidating the marketplace.

"The board has already entered discussions with various acquisition opportunities and in particular is looking to expand the group's footprint in care & case management and are in varying stages of discussions with three targets.

"Having successfully deployed the £13m raised in July 2020 it now requires the additional funding to complete the buy and build strategy and to make some careful investment in technology in order to accelerate the integration of the businesses and capitalize on the synergistic benefits."

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