Sanlam to acquire Merchant Securities for £12.2m

Sanlam UK is set to acquire wealth management firm Merchant Securities for £12.247m as it looks to further expand its UK footprint.

A Sanlam subsidiary, Bidco, has made a cash offer to acquire the entire issued share capital of Merchant.

Under the deal, which Sanlam said has been undertaken to facilitate its entry into the UK stockbroking market, Sanlam UK will own 75% of the Bidco-owned shares and Merchant Securities Management the remaining 25%.

The conditional offer has been made at a price of 22p for each offer share and represents a premium of approximately 91.3% to the closing Price of 11.5p on 30 August 2011.

The deal comes on the back of Sanlam putting in a preliminary offer for Merchant in August after acquiring a 9.7% stake in the firm.

"This potential transaction would facilitate our entry into the UK stockbroking market and supports our strategy to expand our UK activities," said Sanlam Private Investments chief executive offer Daniel Kriel.

"The successful completion of this transaction will expand our existing product and service offering to both our South African and UK high net worth client base and would also enable us to provide clients with a global execution service from within our group."