F&C surges 23% as activist buys £15m stake

AIM-listed activist investor Sherborne Investors has bought a 5.2% stake in F&C Asset Management.

The Guernsey-based firm, which raised £105 million from its AIM-listing in March, has bought around 26.5 million shares in the asset manager worth around £15.6 million.

Shares in F&C, which is headed by Alain Grisay (pictured), jumped by 12p, or 23%, to 64p on the back of the news, 18p below its 12-month high.

Sherborne's investment policy is to target one company at a time, meaning the group does not seek to reduce risk through diversification. It typically seeks to join the board of directors or engage with the company in a bid to profit from turnaround opportunities. This will inevitably lead to speculation that it will ultimately seek to build its stake above 10%.

If, after acquiring a shareholding, the share price of the selected target company rises to a level at which further investment and the effort of a turnaround is deemed to be no longer justified Sherborne will sell up and distribute the proceeds to the company or distribute the proceeds to its partners.  

Sherborne Investors said it may continue to buy shares in F&C as long as it can do so at an acceptable price. It also said the holding would not reach a level where it would be forced make a bid for F&C.

The purchase comes shortly after F&C acquired investment boutique Thames River Capital.