Jarvis Securities Completes Sale of Retail Brokerage Business
Why we think this is good
The sale of Jarvis Securities' retail execution-only brokerage business for up to £11 million is a positive outcome for the company, as it allows them to focus on their remaining Model B Arrangements business. The transaction value is significant compared to the company's market capitalization, and the company may return any distributable reserves to shareholders following the cancellation of its AIM listing, which could be seen as a positive for shareholders. However, the deferred consideration of £2 million introduces some uncertainty, and the company is now committed to delivering an effective and efficient wind-down of its operations over the coming months.
Key Points
- Jarvis Securities has completed the sale of its retail execution-only brokerage business for up to £11 million
- The Group will now focus on terminating the Model B Arrangements and winding down its other operations over the next 15 months
- The company may seek to return any distributable reserves to shareholders following the cancellation of its AIM listing
Summary
Jarvis Securities plc has completed the sale of its retail execution-only brokerage business for a total consideration of up to £11 million. The £9 million initial consideration is due to be paid shortly, with the remaining £2 million deferred for up to 18 months and subject to potential adjustment. Following the transaction, the Group will now mainly comprise the Model 'B' clearing and settlement service business and has begun the process of terminating these arrangements and closing down its other operations, a process expected to take around 15 months. The company may seek to return any distributable reserves to shareholders following the cancellation of its AIM listing.