The UK-based Indian steel billionaire Lakshmi Mittal has acquired a significant stake in London-based listed hedge fund manager RAB Capital plc.
Mittal has acquired 18 million shares representing 4.48% of RAB Capital's issued share capital through Karrick Trust, the beneficiaries of which are the Mittal family.
Sofina, a Belgian investment company "with a market capitalisation of approximately USD 2.5 billion", has also acquired an interest of 22 million shares, representing 5.48 per cent of RAB Capital's issued share capital.
These share acquisitions by the Mittal family and Sofina form the major portion of the sale last week of a total of 57,150,000 ordinary shares of 0.1 pence each in RAB Capital at 50p per share. These shares, which represent 14.23 per cent of the issued share capital have been placed with various institutional and high net-worth investors.
Details of the shares sold by directors and employees last week are as follows: Michael Alen-Buckley (Co-founder, 25 million shares sold), Philip Richards (Co-founder, 25 million shares sold), Christopher de Mattos (600,000 shares sold), Schehrezade Sadeque (700,000 shares sold).
An application has also been made for 12,740,000 Shares in RAB Capital to be admitted to trading on AIM pursuant to the exercise of share options. It is expected that dealings in these new shares, which will rank pari passu in all respects with the existing shares, will commence on 28 June 2005.
Commenting on the share sale, Philip Richards, RAB Chief Executive, said: "This transaction should be seen as part of the process of making RAB Capital into a more established and broad-based company. The recent announcement of the acquisition of Cross Asset Management (see Background Note, below) broadens the investment platform at RAB Capital."
Richards added: "This transaction introduces a number of important long term strategic shareholders, of which the largest, Sofina and Karrick Trust, have declared significant shareholdings."
Background Note: RAB Capital was founded in 1999, and floated on London's Alternative Investment Market (AIM )in March 2004. As at 31st December 2004 it had USD 1.75 billion of assets under management.
RAB Capital currently manages eleven single strategy hedge funds: Europe, Special Situations, High Yield, UK, North American, Japan, Energy; Emerging Europe, European Loan, Energy/Commodity and Octane.
In addition, RAB Capital has an internal fund-of-funds, RAB Fairseat, and an external fund-of-funds, RAB Strancally. RAB Capital also manages an AIM-listed closed-end investment company, the RAB Special Situations Company, and provides advisory and distribution services within the hedge fund industry.
RAB Capital has 71 employees, 32 of whom are investment professionals.
On 20 June RAB announced the acquisition, subject to FSA approval, of Cross Asset Management, which has two single strategy hedge funds - Cross Europe and Cross Credit - with a combined total of approximately USD 250 million of assets under management. The acquisition will bring a further 5 employees to RAB.
RAB Capital plc is authorised and regulated by the Financial Services Authority and is a constituent of the FTSE AIM UK 50 Index.