The Financial Services Opportunities Investment Fund Limited (FSOIF) is one of three specialist closed-ended funds for which Ravenscroft acts as investment manager. The Fund was established to acquire stakes in well-managed financial services and related companies which are in the main based in offshore financial centres, with an overall objective of attaining long term capital growth and an income stream.
Since launching on 7 October 2016, the FSOIF has had a busy first year, listing on The International Stock Exchange and completing five investments. Its Net Asset Value has increased by 12.38% since launching and we believe that the initial investments provide a solid platform from which to deliver long-term capital growth and income streams to shareholders.
FSOIF’s first investment was a 25% stake in Enhance Group Limited. Established in 2005, Enhance is a Jersey-based investment consultancy, investment reporting and wealth consultancy firm with Fintech at its core and an excellent reputation for delivering services through innovative proprietary technology. FSOIF has subsequently taken the opportunity to increase its holding in Enhance to 38.4%.
Following the investment in Enhance, FSOIF acquired 5% of CORVID Holdings Limited, a supplier of secure payment solutions and cyber security services. CORVID was developed by Ultra Electronics, a FTSE 250 company with almost 100 years of experience, providing a commercial offering building on Ultra Electronics’ history of delivering military, aerospace and critical infrastructure technologies.
In December 2016, FSOIF completed its largest investment into PraxisIFM Group Limited, a multijurisdictional administration company headquartered in Guernsey, acquiring a 9.98% shareholding. PraxisIFM was originally established in 1972 and has assets under administration exceeding $42bn. PraxisIFM listed on the TISE in April 2017, at which time FSOIF increased its shareholding to 21.4% (FSOIF has since sold a 0.7% stake, realising a portion of its profits). After listing at £1.00, the shares have performed strongly and were trading at £1.425 (mid-price) at the time of writing.
FSOIF completed its next investment in February 2017, acquiring 100% of Consortia Partnership Limited, a well-known, mid-sized independent trust company operating in Jersey providing tailored fiduciary, fund and corporate services to a global client base. This acquisition provides the cornerstone investment of the fund’s strategy to develop an independent, multi-jurisdictional, mid-tier fiduciary company.
FSOIF recently made its first step into the insurance sector with the incorporation of Next Generation Holdings Limited, a Guernsey holding company established to acquire stakes in insurance companies. The investment is a joint venture alongside Toby Esser, the former CEO of a multinational insurance company, whose input will be invaluable in future acquisitions. In September 2017, Next Generation acquired a 58% stake in AFL Insurance Brokers Limited, a Lloyd’s broker based in London and Manchester.
FSOIF has had a successful first year, delivering a strong performance for its shareholders and completing investments into five high quality, diversified companies which we are confident will deliver growth for years to come. There are also a number of exciting opportunities currently being explored, reflecting the quality and breadth of the offshore financial services industry. We are confident that, if successfully concluded, these opportunities will add value to, and diversify further, the existing portfolio.
Ross Mallett Corporate Finance Manager