Fund platform AJ Bell is reportedly close to brokering a £25 million injection into its planned £500 million flotation later this year in return for a 5% stake in the company’s market cap.
The business, which in the last 12 months has positioned itself as a discretionary management provider in addition to its dealing services, is reportedly negotiating the deal with Michael Spencer, founder of broker-dealer giant ICAP and a former Conservative party treasurer.
The deal took shape following a meeting between Spencer and AJ Bell founder and chief executive Andy Bell (pictured), according to a Sky report.
The expected listing is likely to launch Bell, who still holds a 28% stake in the business, into the upper echelon of City entrepreneurs. It will also be a windfall to its biggest backer Invesco Perpetual, which holds a 37% interest. Neil Woodford exited a significant stake earlier this year.
AJ Bell administers client assets of £42 billion.
The company hired veteran asset allocator Kevin Doran late last year to oversee growth in its discretionary division, which currently holds £200 million in client funds and is taking between £3 million and £4 million in inflows a week.
Spencer remains chief executive of Nex, the broker dealer business he held onto following the sale of the ICAP's voice-brokerage business to Tullett Prebon in 2016, alongside the ICAP name.
Nex today announced it has reached agreement to sell to US exchange CME Group for £3.9 billion, valuing Spencer’s holding in the business at £668 million.